2022-12-13 sec-litreleases litigation_release 65 KB 1,783 chars

SEC v. J.H. Darbie & Co., Inc., No. LR-25590, Southern District of New York (Dec. 13, 2022) — Press Release

raw: J.H. Darbie & Co., Inc.

J.H. Darbie & Co., Inc., No. 1:22-cv-10482 (S.D.N.Y. Dec. 13, 2022)

Caption
Securities Exchange Commission v. J.H. Darbie & Co., Inc.
Source PDF JSON
summary

The SEC charged J.H. Darbie & Co., Inc. with anti-money laundering violations for failing to report suspicious penny stock transactions, seeking injunctive relief and civil penalties.

paragraph

The SEC charged New York-based brokerage firm J.H. Darbie & Co., Inc. with failing to report suspicious activity involving tens of billions of shares of penny stocks. Between January 2018 and January 2020, the firm allegedly failed to investigate and file required Suspicious Activity Reports despite clear red flags. The agency is seeking permanent injunctive relief and civil monetary penalties for violations of the Securities Exchange Act.

narrative

The Securities and Exchange Commission has charged J.H. Darbie & Co., Inc., a New York City-based brokerage firm, with failing to report suspicious activity related to over-the-counter penny stock transactions. From at least January 2018 to January 2020, the firm failed to investigate and file Suspicious Activity Reports (SARs) for transactions involving tens of billions of shares. These transactions raised red flags explicitly identified in the firm's own anti-money laundering policies and regulatory guidance. The SEC's complaint, filed in Manhattan federal court, alleges violations of Section 17(a) of the Securities Exchange Act of 1934 and Rule 17a-8. To resolve these violations, the SEC is seeking permanent injunctive relief and civil monetary penalties. The investigation was conducted by the SEC's New York Regional Office.

Enriched metadata

Scheme
broker-dealer-fraud (95%)
Court
Southern District of New York
Case No.
1:22-cv-10482
Entity
J.H. Darbie & Co., Inc.
CIK
0001042567
Classified broker-dealer-fraud(confidence 95%). EDGAR detection: forms Form D· recall 29% / precision 9%. detection rule →
Statutes
Section 17(a) of the Securities Exchange ActRule 17a-8
Parties
Securities Exchange CommissionJ.H. Darbie & Co., Inc.
Keywords
darbiesecurities exchangesecuritiesincnewsuspicioustransactionsbrokerage firmanti-money launderingdecember securitiesexchange commissioncommission darbiesuspicious activitysuspicious transactionsinvestigation conducted

Exhibits & Attached Documents (1)

Extracted insights

Entities 8
  • organization Broker-Dealers
  • person christine d. ely
  • organization J.H. Darbie & Co., Inc.
  • person Michael Altschuler
  • agency sec's investigation
  • agency Securities and Exchange Commission
  • organization Securities and Exchange Commission
  • person victor suthammanont
Triples 9
  • Securities And Exchange Commission charged J.H. Darbie & Co., Inc.
  • J.H. Darbie & Co., Inc. failed to report suspicious activity
  • J.H. Darbie & Co., Inc. traded tens of billions of shares of low-priced securities
  • Broker-Dealers are required to file Suspicious Activity Reports (SARs)
  • J.H. Darbie failed to investigate numerous suspicious transactions
  • Securities And Exchange Commission seeks permanent injunctive relief and civil monetary penalties
  • Christine D. Ely conducted SEC's investigation
  • Victor Suthammanont will lead litigation
  • Michael Altschuler conducted SEC's examination
PDF (from attached: complaint)
Defendant J.H. Darbie & Co., Inc. (“J.H. Darbie”) alleges as follows: · Source
Text layers
Extracted body text (1,783c) 
SEC Charges Brokerage Firm with Anti-Money Laundering Violations Litigation Release No. 25590 / December 13, 2022 Securities and Exchange Commission v. J.H. Darbie & Co., Inc., No. 1:22-cv-10482 (S.D.N.Y. filed Dec. 12, 2022) On December 12, 2022, the Securities and Exchange Commission charged J.H. Darbie & Co., Inc., a New York City-based brokerage firm, with failing to report suspicious activity related to transactions in tens of billions of shares of low-priced securities - or "penny stocks" - that were traded in over-the-counter markets. To help detect potential securities law and money-laundering violations, broker-dealers are required to file Suspicious Activity Reports (SARs) describing suspicious transactions taking place through their firms. According to the SEC's complaint, from at least January 2018 to January 2020, J.H. Darbie failed to investigate and file SARs for numerous suspicious transactions, even when the transactions raised red flags recognized in J.H Darbie's written anti-money laundering policies and procedures and in regulatory guidance. The SEC's complaint, filed in federal district court in Manhattan, charges J.H. Darbie with violations of Section 17(a) of the Securities Exchange Act of 1934 and Rule 17a-8 thereunder and seeks permanent injunctive relief and civil monetary penalties. The SEC's investigation was conducted by Christine D. Ely, Suzanne Bettis, and Alison Conn, and was supervised by Thomas P. Smith, Jr. of the New York Regional Office. Victor Suthammanont of the New York Regional Office will lead the litigation with Ms. Bettis. The SEC's examination that led to the investigation was conducted by Michael Altschuler, Stephanie Buonaguro, Linda Lettieri, and Eleni Stalzer of the New York Regional Office. SEC Complaint
OCR text (1,783c · html-text · 99% conf) 
SEC Charges Brokerage Firm with Anti-Money Laundering Violations Litigation Release No. 25590 / December 13, 2022 Securities and Exchange Commission v. J.H. Darbie & Co., Inc., No. 1:22-cv-10482 (S.D.N.Y. filed Dec. 12, 2022) On December 12, 2022, the Securities and Exchange Commission charged J.H. Darbie & Co., Inc., a New York City-based brokerage firm, with failing to report suspicious activity related to transactions in tens of billions of shares of low-priced securities - or "penny stocks" - that were traded in over-the-counter markets. To help detect potential securities law and money-laundering violations, broker-dealers are required to file Suspicious Activity Reports (SARs) describing suspicious transactions taking place through their firms. According to the SEC's complaint, from at least January 2018 to January 2020, J.H. Darbie failed to investigate and file SARs for numerous suspicious transactions, even when the transactions raised red flags recognized in J.H Darbie's written anti-money laundering policies and procedures and in regulatory guidance. The SEC's complaint, filed in federal district court in Manhattan, charges J.H. Darbie with violations of Section 17(a) of the Securities Exchange Act of 1934 and Rule 17a-8 thereunder and seeks permanent injunctive relief and civil monetary penalties. The SEC's investigation was conducted by Christine D. Ely, Suzanne Bettis, and Alison Conn, and was supervised by Thomas P. Smith, Jr. of the New York Regional Office. Victor Suthammanont of the New York Regional Office will lead the litigation with Ms. Bettis. The SEC's examination that led to the investigation was conducted by Michael Altschuler, Stephanie Buonaguro, Linda Lettieri, and Eleni Stalzer of the New York Regional Office. SEC Complaint

Related documents (1)