SEC v. Michael Gastauer; Silverton SA Inc.; Wintercap SA Inc.; WB21 US Inc.; WB21 NA Inc.; C Capital Corp., et al., No. LR-25412, District of Massachusetts (June 8, 2022) — Press Release
raw: Knox et al.;
Knox et al.;, No. 1:18-cv-12058 (June 8, 2022)
summary
The SEC obtained final judgments against Michael Gastauer's six entities and two relief defendants, ordering them to pay over $15 million for facilitating a $165 million microcap fraud scheme.
paragraph
The SEC secured final judgments against six entities controlled by Michael Gastauer and two relief defendants for aiding an international microcap fraud scheme involving over $165 million in illegal sales. The court ordered the six entities to pay $1,035,909 in civil penalties each, along with joint and several disgorgement of $11,264,415 and $1,736,559 in interest. Additionally, relief defendants B21 Ltd. and WB21 DMCC were ordered to pay combined disgorgement and interest totaling approximately $1.58 million.
narrative
The SEC obtained final judgments against six U.S.-based entities controlled by Michael Gastauer and two relief defendants for their role in an international microcap fraud scheme. The scheme, orchestrated by Roger Knox and his Swiss entity Wintercap SA, generated more than $165 million in illegal stock sales across at least 50 microcap companies. Gastauer's entities used U.S. bank accounts to disburse proceeds from these sales, which were designed to evade U.S. securities laws regarding controlling shareholders. The court ordered the six entities to pay $1,035,909 in civil penalties each, plus joint and several disgorgement of $11,26 and interest of $1.73 million. Relief defendants B21 Ltd. and WB21 DMCC were also ordered to pay roughly $1.58 million in combined disgorgement and interest. The entities are permanently enjoined from violating antifraud and registration provisions of the Securities Act and the Exchange Act. Meanwhile, Roger Knox pleaded guilty to related criminal charges of securities fraud and conspiracy.
Classified unregistered-securities(confidence 95%). EDGAR detection: forms Form D/S-1· recall 41% / precision 30%. detection rule →
Statutes
Parties
Securities and Exchange CommissionRoger KnoxWintercap SA Inc.B21 Ltd.Pro Se Party Michael T. GastauerShamal Internaional FZESimone Gastauer FoehrWB21 DMCCWintercap SAWB21 N.A. Inc.C Capital CorpWB21 Us IncB2 Cap Inc.Silverton SA Inc.Raimund GastauerCity Group Alliance Inc.Michael Gastauer
Keywords
securitiesknoxentitiesincfinal judgmentswintercapsecurities exchangedisgorgement amountamount prejudgmentprejudgment interestpayfinaljudgmentsfraudgastauer
Exhibits & Attached Documents (9)
- judgment SEC v. ROGER KNOX
- judgment FINAL JUDGMENT AS TO DEFENDANT B2 CAP INC.
- judgment its claims that relief defendant B21 Ltd. (“Relief Defendant”) is liable in unjust
- judgment FINAL JUDGMENT AS TO DEFENDANT C CAPITAL CORP.
- judgment its claims that relief defendant WB21 DMCC (“Relief Defendant”) is liable in
- judgment FINAL JUDGMENT AS TO DEFENDANT WB21 NA INC.
- judgment FINAL JUDGMENT AS TO DEFENDANT WB21 US INC.
- judgment FINAL JUDGMENT AS TO DEFENDANT WINTERCAP SA INC.
- pdf FINAL JUDGMENT AS TO DEFENDANT SILVERTON SA INC.
Extracted insights
Dollar amounts 12
- $165.00M $165 million $100M–$1B
- $15.00M $15 Million $10M–$100M
- $15.00M $15 million $10M–$100M
- $11.26M $11,264,415 $10M–$100M
- $1.74M $1,736,559 $1M–$10M
- $1.04M $1,035,909 $1M–$10M
- $944K $943,955 $100K–$1M
- $825K $824,689 $100K–$1M
- $635K $634,645 $100K–$1M
- $554K $554,460 $100K–$1M
- $119K $119,266 $100K–$1M
- $80K $80,185 $10K–$100K
Entities 4
- person michael gastauer
- person Roger Knox
- agency Securities and Exchange Commission
- scheme_term to securities fraud and conspiracy to commit securities fraud
Triples 12
- Securities And Exchange Commission obtained final judgments six entities controlled by Michael Gastauer and two relief defendants for facilitating an international fraud scheme
- Securities And Exchange Commission charged Michael Gastauer and six U.S.-based entities with aiding and abetting a microcap fraud orchestrated by Roger Knox and Wintercap SA
- Roger Knox and Wintercap SA helped sellers of microcap securities evade U.S. securities laws restricting sales by controlling shareholders
- Roger Knox used Wintercap SA to conceal sellers' stock ownership by providing anonymous access to offshore brokerage accounts
- Michael Gastauer used six entities' U.S. bank accounts to disburse proceeds of illegal stock sales
- U.S. Attorney for the District of Massachusetts indicted Roger Knox on one count of securities fraud and one count of conspiracy to commit securities fraud
- Roger Knox pled guilty to securities fraud and conspiracy to commit securities fraud
- The Court granted the Commission's motion for summary judgment against the Entities
- The Court entered final judgments permanently enjoining the Entities from violating antifraud provisions of Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5
- The Court ordered the Entities to pay civil penalties of $1,035,909 each and joint and several disgorgement up to $11,264,415 with prejudgment interest of $1,736,559
- The Court ordered relief defendant B21 Ltd. to pay disgorgement of $824,689 with prejudgment interest of $119,266 for a total of $943,955
- The Court ordered relief defendant WB21 Dmcc to pay disgorgement of $554,460 with prejudgment interest of $80,185 for a total of $634,645
PDF (from attached: judgment)
Text layers
Extracted body text (3,177c)
SEC Obtains Final Judgments Ordering Entities to Pay Over $15 Million for Facilitating International Fraud Scheme Litigation Release No. 25412 / June 8, 2022 Securities and Exchange Commission v. Knox et al.;, ivil Action No. 1:18-cv-12058 (D. Mass. filed October 2, 2018) The Securities and Exchange Commission announced that it obtained final judgments against six entities controlled by Michael Gastauer, of Germany, and two entities as relief defendants, for their role in an international scheme that generated more than $165 million of illegal sales of stock on the U.S. markets in at least 50 microcap companies. The final judgments order the entities to pay over $15 million. On October 2, 2018, the SEC charged Gastauer and six U.S.-based entities that he controlled, Silverton SA Inc., Wintercap SA Inc., WB21 US Inc., WB21 NA Inc., C Capital Corp., and B2 Cap Inc., (together, the "Entities") with aiding and abetting a microcap fraud orchestrated by U.K. citizen Roger Knox and his Swiss entity, Wintercap SA. The SEC's complaint alleges that Knox and Wintercap SA helped sellers of large volumes of microcap securities evade U.S. securities laws that restrict sales by controlling shareholders. According to the complaint, Knox used Wintercap SA to conceal sellers' stock ownership by providing them anonymous access to offshore brokerage accounts, and Gastauer used his six entities' U.S. bank accounts to disburse the proceeds of those illegal stock sales. In a parallel criminal action brought by the U.S. Attorney for the District of Massachusetts, on October 23, 2018, a federal grand jury in Massachusetts indicted Knox on one count of securities fraud and one count of conspiracy to commit securities fraud. Knox pled guilty on January 13, 2020. His sentencing remains pending. On June 3, 2022, the Court granted the Commission's motion for summary judgment as to the Entities and entered final judgments permanently enjoining the Entities from violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 ("Securities Act") and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder and the registration provisions of Section 5 of the Securities Act. The Entities were ordered to pay civil penalties of $1,035,909 each and joint and several disgorgement up to the amount of $11,264,415 with prejudgment interest of $1,736,559. Relief defendant B21 Ltd. was ordered to pay disgorgement in the amount of $824,689 with prejudgment interest of $119,266, for a total of $943,955 and relief defendant WB21 DMCC was ordered to pay disgorgement in the amount of $554,460 with prejudgment interest of $80,185, for a total of $634,645. The SEC's ongoing case against Raimund Gastauer, Knox, Wintercap SA, and Shamal International is being handled by Trevor Donelan, Kathleen Shields, Jonathan Allen, Nita Klunder, and Amy Gwiazda in the Boston Regional Office. Memorandum and Order on Plaintiff's Motion for Summary Judgment Judgment - B2 Cap Inc. Judgment - B21 Ltd. Judgment - C Capital Corp. Judgment = Silverton SA Inc. Judgment - WB21 DMCC Judgment - WB21 NA Inc. Judgment - WB21 US Inc. Judgment - Wintercap SA Inc.OCR text (3,177c · html-text · 99% conf)
SEC Obtains Final Judgments Ordering Entities to Pay Over $15 Million for Facilitating International Fraud Scheme Litigation Release No. 25412 / June 8, 2022 Securities and Exchange Commission v. Knox et al.;, ivil Action No. 1:18-cv-12058 (D. Mass. filed October 2, 2018) The Securities and Exchange Commission announced that it obtained final judgments against six entities controlled by Michael Gastauer, of Germany, and two entities as relief defendants, for their role in an international scheme that generated more than $165 million of illegal sales of stock on the U.S. markets in at least 50 microcap companies. The final judgments order the entities to pay over $15 million. On October 2, 2018, the SEC charged Gastauer and six U.S.-based entities that he controlled, Silverton SA Inc., Wintercap SA Inc., WB21 US Inc., WB21 NA Inc., C Capital Corp., and B2 Cap Inc., (together, the "Entities") with aiding and abetting a microcap fraud orchestrated by U.K. citizen Roger Knox and his Swiss entity, Wintercap SA. The SEC's complaint alleges that Knox and Wintercap SA helped sellers of large volumes of microcap securities evade U.S. securities laws that restrict sales by controlling shareholders. According to the complaint, Knox used Wintercap SA to conceal sellers' stock ownership by providing them anonymous access to offshore brokerage accounts, and Gastauer used his six entities' U.S. bank accounts to disburse the proceeds of those illegal stock sales. In a parallel criminal action brought by the U.S. Attorney for the District of Massachusetts, on October 23, 2018, a federal grand jury in Massachusetts indicted Knox on one count of securities fraud and one count of conspiracy to commit securities fraud. Knox pled guilty on January 13, 2020. His sentencing remains pending. On June 3, 2022, the Court granted the Commission's motion for summary judgment as to the Entities and entered final judgments permanently enjoining the Entities from violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 ("Securities Act") and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder and the registration provisions of Section 5 of the Securities Act. The Entities were ordered to pay civil penalties of $1,035,909 each and joint and several disgorgement up to the amount of $11,264,415 with prejudgment interest of $1,736,559. Relief defendant B21 Ltd. was ordered to pay disgorgement in the amount of $824,689 with prejudgment interest of $119,266, for a total of $943,955 and relief defendant WB21 DMCC was ordered to pay disgorgement in the amount of $554,460 with prejudgment interest of $80,185, for a total of $634,645. The SEC's ongoing case against Raimund Gastauer, Knox, Wintercap SA, and Shamal International is being handled by Trevor Donelan, Kathleen Shields, Jonathan Allen, Nita Klunder, and Amy Gwiazda in the Boston Regional Office. Memorandum and Order on Plaintiff's Motion for Summary Judgment Judgment - B2 Cap Inc. Judgment - B21 Ltd. Judgment - C Capital Corp. Judgment = Silverton SA Inc. Judgment - WB21 DMCC Judgment - WB21 NA Inc. Judgment - WB21 US Inc. Judgment - Wintercap SA Inc.