2022-04-14 sec-litreleases litigation_release 65 KB 2,336 chars

SEC v. Benja Inc.; and Andrew Chapin, No. LR-25365, Northern District of California (Apr. 14, 2022) — Press Release

raw: Benja Inc. and Andrew Chapin

Benja Inc. and Andrew Chapin, No. LR-25365 (Apr. 14, 2022)

Caption
SEC v. Benja Inc, et al.
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summary

The SEC obtained a final judgment against Andrew J

paragraph

The SEC obtained a final judgment against Andrew J. Chapin, the former CEO of Benja Inc., for defrauding investors by falsely claiming the e-commerce startup had lucrative contracts with major retailers and by using impersonation and forged documents to secure funding. Chapin agreed to pay $2,819,692, comprising $2,635,000 in disgorgement and $1 million in prejudgment interest, to settle charges of violating Sections 17(a) of the Securities Act and 10(b) of the Exchange Act. As part of the resolution, Chapin was permanently enjoined from future securities violations and barred from serving as an officer or director of a public company. These financial penalties were deemed satisfied by his guilty plea in a related criminal case, which resulted in a 36-month prison sentence and an order to pay $8,069,900 in restitution to victims.

narrative

The SEC obtained a final judgment against Andrew J. Chapin, the former CEO of Benja Inc., for defrauding investors by falsely claiming the e-commerce startup had lucrative contracts with major retailers and by using impersonation and forged documents to secure funding. Chapin agreed to pay $2,819,692, comprising $2,635,000 in disgorgement and $1 million in prejudgment interest, to settle charges of violating Sections 17(a) of the Securities Act and 10(b) of the Exchange Act. As part of the resolution, Chapin was permanently enjoined from future securities violations and barred from serving as an officer or director of a public company. These financial penalties were deemed satisfied by his guilty plea in a related criminal case, which resulted in a 36-month prison sentence and an order to pay $8,069,900 in restitution to victims. The SEC obtained a final judgment against Andrew J. Chapin, former CEO of Benja Inc., who defrauded investors by falsely representing the company as a successful e-commerce platform generating revenue from major brands, when in fact it never did business with those companies. Chapin agreed to pay $2,819,692 to settle SEC charges, including $2,635,000 in disgorgement and $184,692 in prejudgment interest, which was satisfied through his guilty plea in a related criminal case resulting in a 36-month prison sentence and $8,069,900 in restitution. The SEC alleged that Chapin and associates impersonated customers and investors to secure funding and provided forged documents to investors. The case was handled by the SEC's San Francisco Regional Office.

Enriched metadata

Scheme
corporate-fraud (95%)
Court
Northern District of California
Outcome
settled
Settlement
$2,819,692
Disgorgement
$184,692
Entity
Benja Inc.
Classified corporate-fraud(confidence 95%). EDGAR detection: forms 10-K/10-Q/8-K· recall 56% / precision 8%. detection rule →
Statutes
Section 17(a) of the Securities ActSection 10(b) of the Securities Exchange ActRule 10b-5
Parties
Securities and Exchange CommissionBenja Inc.Andrew Chapin
Keywords
chapinbenjaandrew chapinsecurities exchangeincandrewinvestorssecuritiessec'sdefrauded investorsexchange commissionentry finalinvestors benjaventure capitalmatthew meyerhofer

Exhibits & Attached Documents (1)

Extracted insights

Dollar amounts 4
  • $8.07M $8,069,900 $1M–$10M
  • $2.82M $2,819,692 $1M–$10M
  • $2.63M $2,635,000 $1M–$10M
  • $185K $184,692 $100K–$1M
Entities 9
  • person andrew j. chapin
  • company andrew j. chapin from serving as officer or director of a public company
  • company benja inc.
  • company chief executive officer of benja inc.
  • person final judgment
  • company investors in benja inc.
  • agency sec investigation
  • agency sec litigation
  • agency Securities and Exchange Commission
Triples 19
  • Securities And Exchange Commission obtained final judgment
  • Andrew J. Chapin was Chief Executive Officer of Benja Inc.
  • Andrew J. Chapin agreed to pay $2,819,692
  • Andrew J. Chapin defrauded investors in Benja Inc.
  • Benja Inc. declared bankruptcy October 2020
  • Securities And Exchange Commission filed complaint November 11, 2020
  • Andrew J. Chapin told investors that Benja was a successful online advertising platform
  • Benja Inc. never did business with the purported customer companies
  • Andrew J. Chapin enlisted associates to induce investments from venture capital investors
  • Andrew J. Chapin impersonated representatives of Benja's purported customers
  • Andrew J. Chapin provided investor with forged contracts and doctored bank statements
  • Andrew J. Chapin consented to entry of final judgment permanently enjoining him from violating securities laws
  • Final judgment barring Andrew J. Chapin from serving as officer or director of a public company
  • Final judgment ordered Andrew J. Chapin to pay $2,635,000 in disgorgement and $184,692 in prejudgment interest
  • Court sentenced Andrew J. Chapin to 36 months imprisonment
  • Court ordered Andrew J. Chapin to pay $8,069,900 restitution to victims
  • SEC litigation conducted by Susan LaMarca and Matthew Meyerhofer of the San Francisco Regional Office
  • SEC investigation conducted by Matthew Meyerhofer of the San Francisco Regional Office
  • SEC investigation supervised by Tracy L. Davis and Monique C. Winkler of the San Francisco Regional Office
PDF (from attached: judgment)
complaint; and Defendant Andrew J. Chapin having entered a general appearance; consented to the · Source
Text layers
Extracted body text (2,336c) 
SEC Obtains Final Judgment Against CEO of E-Commerce Startup Who Defrauded Investors Litigation Release No. 25365 / April 14, 2022 Securities and Exchange Commission v. Benja Inc. and Andrew Chapin, No. 20-CV-08238 (N.D. Cal. filed November 11, 2020) The Securities and Exchange Commission announced today the entry of a final judgment on April 11, 2022, against Andrew J. Chapin, formerly the Chief Executive Officer of Benja Inc. Chapin agreed to pay $2,819,692 to settle charges that he defrauded investors in Benja, which declared bankruptcy in October 2020. The SEC's complaint, filed on November 11, 2020, alleged that from 2018 to 2020, Chapin, the founder and CEO of Benja, told investors that Benja was a successful online advertising platform that generated millions of dollars in revenue from popular consumer clothing brands and retailers. In reality, the complaint alleged, Benja never did business with the companies. The complaint further alleged that in order to secure investments, Chapin enlisted one or more associates to help induce investments from venture capital investors by impersonating representatives of Benja's purported customers and the supposed founder of a venture capital fund who falsely claimed to have made a large investment in Benja. According to the complaint, Chapin also provided an investor with forged contracts and doctored bank statements. Chapin consented to the entry of a final judgment permanently enjoining him from violating Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, permanently barring him from serving as an officer or director of a public company, and ordering him to pay a total of $2,635,000 in disgorgement and $184,692 in prejudgment interest. Those payments are deemed satisfied by Chapin's guilty plea in a related criminal matter, pursuant to which the court sentenced Chapin to 36 months imprisonment and ordered him to pay $8,069,900 of restitution to the victims of his fraudulent scheme. The SEC's litigation against Chapin was conducted by Susan LaMarca and Matthew Meyerhofer of the SEC's San Francisco Regional Office. The SEC's investigation was conducted by Matthew Meyerhofer and supervised by Tracy L. Davis and Monique C. Winkler of the San Francisco Regional Office. Judgment
OCR text (2,336c · html-text · 99% conf) 
SEC Obtains Final Judgment Against CEO of E-Commerce Startup Who Defrauded Investors Litigation Release No. 25365 / April 14, 2022 Securities and Exchange Commission v. Benja Inc. and Andrew Chapin, No. 20-CV-08238 (N.D. Cal. filed November 11, 2020) The Securities and Exchange Commission announced today the entry of a final judgment on April 11, 2022, against Andrew J. Chapin, formerly the Chief Executive Officer of Benja Inc. Chapin agreed to pay $2,819,692 to settle charges that he defrauded investors in Benja, which declared bankruptcy in October 2020. The SEC's complaint, filed on November 11, 2020, alleged that from 2018 to 2020, Chapin, the founder and CEO of Benja, told investors that Benja was a successful online advertising platform that generated millions of dollars in revenue from popular consumer clothing brands and retailers. In reality, the complaint alleged, Benja never did business with the companies. The complaint further alleged that in order to secure investments, Chapin enlisted one or more associates to help induce investments from venture capital investors by impersonating representatives of Benja's purported customers and the supposed founder of a venture capital fund who falsely claimed to have made a large investment in Benja. According to the complaint, Chapin also provided an investor with forged contracts and doctored bank statements. Chapin consented to the entry of a final judgment permanently enjoining him from violating Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, permanently barring him from serving as an officer or director of a public company, and ordering him to pay a total of $2,635,000 in disgorgement and $184,692 in prejudgment interest. Those payments are deemed satisfied by Chapin's guilty plea in a related criminal matter, pursuant to which the court sentenced Chapin to 36 months imprisonment and ordered him to pay $8,069,900 of restitution to the victims of his fraudulent scheme. The SEC's litigation against Chapin was conducted by Susan LaMarca and Matthew Meyerhofer of the SEC's San Francisco Regional Office. The SEC's investigation was conducted by Matthew Meyerhofer and supervised by Tracy L. Davis and Monique C. Winkler of the San Francisco Regional Office. Judgment

Related documents (1)