2002-10-22 sec-litreleases litigation_release 66 KB 4,203 chars

SEC v. Daniel W. Jacobs, No. LR-17796, Central District of California (Oct. 22, 2002) — Press Release

raw: Daniel W. Jacobs

Daniel W. Jacobs, No. LR-17796 (Oct. 22, 2002)

Caption: SEC v. Daniel W. Jacobs

summary

Daniel W. Jacobs conspired to obstruct the SEC’s investigation into Reed E. Slatkin’s $593 million Ponzi scheme by fabricating fake European entities, falsifying documents, and shredding evidence, receiving $1 million and gold coins, and pleaded guilty to obstruction of justice while Slatkin was convicted on 15 felony charges and permanently barred from securities activities.

paragraph

Daniel W. Jacobs pleaded guilty to conspiracy to obstruct the SEC’s investigation into Reed E. Slatkin’s $593 million Ponzi scheme, which defrauded approximately 800 investors. Jacobs fabricated false documentation for non-existent entities NAA Financial and Romulus Investment Trust, created fake European phone numbers and letterhead, altered fax machines to display fraudulent headers, and signed documents under the alias Michel Axiall to falsely suggest over $400 million had been wired to Swiss accounts; in return, he received $1 million and gold coins from Slatkin. Slatkin, who orchestrated the fraud, pleaded guilty to 15 felony charges including mail fraud, wire fraud, money laundering, and obstruction, and was permanently enjoined from securities activities and barred from associating with investment advisers.

narrative

Daniel W. Jacobs conspired with Reed E. Slatkin to obstruct the SEC’s investigation into Slatkin’s $593 million Ponzi scheme, which defrauded approximately 800 investors from 1986 until May 2001. Jacobs fabricated elaborate false documentation for the non-existent Swiss brokerage NAA Financial and the Romulus Investment Trust, including forged bank records, brokerage statements, and European-style letterhead, and altered his fax machine to display fake European headers to deceive regulators. He introduced a European co-conspirator to lend credibility to the fraud, provided false explanations for delays in document production, and used the alias Michel Axiall to sign fabricated documents. Jacobs also shredded key files to conceal his involvement and received $1 million and gold coins from Slatkin as payment for his role. The SEC obtained a temporary restraining order against Slatkin on May 11, 2001, and a permanent injunction was entered on June 7, 2001, barring him from future securities violations and association with investment advisers. Slatkin pleaded guilty to 15 felony charges, including mail and wire fraud, money laundering, and conspiracy to obstruct justice, and was scheduled for sentencing in February 2003. Jacobs agreed to plead guilty to obstruction of justice in November 2002, admitting to all key acts of deception designed to mislead the SEC into believing Slatkin’s investors’ funds were held in legitimate offshore accounts.

Enriched metadata

Scheme: obstruction (100%)
Court: Central District of California
Outcome: pleaded · 2003-02-24
Victim loss: $593,000,000
Victims: 800
Entity: Daniel W. Jacobs

Classified obstruction(confidence 100%). No EDGAR filing fingerprint (criminal/DOJ-side scheme). detection rule →

Extracted insights

Dollar amounts 3

$593.00M $593 million $100M–$1B
$400.00M $400 million $100M–$1B
$1.00M $1 million $1M–$10M

Entities 4

person daniel w. jacobs
agency Securities and Exchange Commission
agency the u.s. attorney's office for the central district of california
court the u.s. district court for the central district of california

Triples 24

The U.S. Attorney for the Central District of California and the Securities and Exchange Commission Announced Daniel W. Jacobs was charged with conspiracy to obstruct justice during an SEC enforcement investigation of Reed E. Slatkin
Daniel W. Jacobs Agreed to plead guilty To the charge when he is arraigned in November
Jacobs Admitted That when the SEC began a formal investigation of Slatkin's activities in 1999, Jacobs and others conspired to obstruct the SEC's investigation
Jacobs and others Provided The SEC with false documents concerning NAA Financial, a purported Swiss brokerage firm in which Slatkin purportedly held his investors' funds
Jacobs Received $1 million and a quantity of gold coins from Slatkin
Jacobs Helped Slatkin prepare To testify falsely before the SEC by reviewing the details of the concocted NAA Financial story with Slatkin
Jacobs Introduced and encouraged An unindicted co-conspirator in Europe to assist Slatkin in an attempt to convince the SEC that NAA Financial was a legitimate European brokerage company
Jacobs Set-up False European telephone numbers for NAA Financial
Jacobs Purchased European-style NAA Financial letterhead stationary in Europe and provided it to Slatkin
Jacobs Altered A facsimile machine at his residence so that recipients of documents sent from the machine would see a header which reflected the name NAA Financial and a European facsimile number
Jacobs Caused the SEC to be falsely informed That NAA Financial's delay in providing documentation was due to the conduct of another entity, Romulus Investment Trust, which controlled the accounts
Jacobs Caused the SEC to be falsely informed Using the name Charles Thibodeau, that Romulus Investment Trust was transferring Slatkin's funds to a new NAA Financial account in a Swiss Bank
Jacobs Fabricated NAA Financial and Romulus Investment Trust documentation, including letters and brokerage statements, which was provided to the SEC
Jacobs Signed Fabricated NAA Financial documents as Michel Axiall
Jacobs Fabricated Bank records and correspondence which reflected that over $400 million had been wire-transferred into purported Swiss accounts held for Slatkin's benefit
Jacobs Shredded portions Of Slatkin's NAA Financial files which exposed Jacobs' role in the conspiracy in an effort to conceal those records from the SEC and other law enforcement authorities
The SEC Obtained A temporary restraining order and asset freeze against Slatkin in federal district court in Los Angeles
The Commission Alleged That Slatkin defrauded hundreds of clients through his unregistered investment advisory business located in Santa Barbara, California
The U.S. District Court for the Central District of California Entered A Judgment of Permanent Injunction against Reed E. Slatkin
The judgment Enjoins Slatkin from future violations of the antifraud provisions of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Sections 206(1) and 206(2) of the Investment Advisers Act of 1940 and the investment adviser registration provisions of Section 203(a) of the Advisers Act
Slatkin Consented To the entry of the injunction
The Commission Barred Slatkin from associating with any investment adviser
The U.S. Attorney's Office for the Central District of California Charged Slatkin with 15 felony charges, including mail and wire fraud, money laundering and conspiracy to obstruct justice during an SEC enforcement investigation
Slatkin Pleased guilty And is scheduled

View original SEC litigation releasesec.gov

Extracted body text (4,203c)

Litigation Release No. 17796 / October 22, 2002 U.S. v. Daniel W. Jacobs, CR 02-1108 (C.D. Cal.) Man Charged with Conspiracy to Obstruct SEC Investigation The U.S. Attorney for the Central District of California and the Securities and Exchange Commission announced that Daniel W. Jacobs was charged with conspiracy to obstruct justice during an SEC enforcement investigation of Reed E. Slatkin. From approximately 1986 until May 2001, Slatkin operated a massive Ponzi scheme in which he solicited more than $593 million from approximately 800 investors. Jacobs has agreed to plead guilty to the charge when he is arraigned in November. In his plea agreement, Jacobs admitted that when the SEC began a formal investigation of Slatkin's activities in 1999, Jacobs and others conspired to obstruct the SEC's investigation. Jacobs and others, among other things, provided the SEC with false documents concerning NAA Financial, a purported Swiss brokerage firm in which Slatkin purportedly held his investors' funds. For his role, Jacobs received $1 million and a quantity of gold coins from Slatkin. Specifically, Jacobs: Helped Slatkin prepare to testify falsely before the SEC by reviewing the details of the concocted NAA Financial story with Slatkin. Introduced and encouraged an unindicted co-conspirator in Europe to assist Slatkin in an attempt to convince the SEC that NAA Financial was a legitimate European brokerage company. Set-up false European telephone numbers for NAA Financial. Purchased European-style NAA Financial letterhead stationary in Europe and provided it to Slatkin. Altered a facsimile machine at his residence so that recipients of documents sent from the machine would see a header which reflected the name NAA Financial and a European facsimile number. Caused the SEC to be falsely informed that NAA Financial's delay in providing documentation was due to the conduct of another entity, Romulus Investment Trust, which controlled the accounts. Caused the SEC to be falsely informed, using the name Charles Thibodeau, that Romulus Investment Trust was transferring Slatkin's funds to a new NAA Financial account in a Swiss Bank. Fabricated NAA Financial and Romulus Investment Trust documentation, including letters and brokerage statements, which was provided to the SEC. Signed fabricated NAA Financial documents as Michel Axiall. Fabricated bank records and correspondence which reflected that over $400 million had been wire-transferred into purported Swiss accounts held for Slatkin's benefit. Shredded portions of Slatkin's NAA Financial files which exposed Jacobs' role in the conspiracy in an effort to conceal those records from the SEC and other law enforcement authorities.On May 11, 2001, the SEC obtained a temporary restraining order and asset freeze against Slatkin in federal district court in Los Angeles. The Commission alleged that Slatkin defrauded hundreds of clients through his unregistered investment advisory business located in Santa Barbara, California. On June 7, 2001, the U.S. District Court for the Central District of California entered a Judgment of Permanent Injunction against Reed E. Slatkin. The judgment enjoins Slatkin from future violations of the antifraud provisions of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Sections 206(1) and 206(2) of the Investment Advisers Act of 1940 and the investment adviser registration provisions of Section 203(a) of the Advisers Act. Slatkin, without admitting or denying the allegations in the complaint, consented to the entry of the injunction. Slatkin has also been barred by the Commission from associating with any investment adviser. The U.S. Attorney's Office for the Central District of California charged Slatkin with 15 felony charges, including mail and wire fraud, money laundering and conspiracy to obstruct justice during an SEC enforcement investigation. Slatkin pleaded guilty and is scheduled to be sentenced on February 24, 2003. Additional information can be found in Litigation Release No. 16988 (May 15, 2001) and No. 17033 (June 12, 2001) and Advisers Act Release No. 2006 (January 2, 2002).

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