SEC v. FREDERICK L. SHARP; ZHIYING YVONNE GASARCH; COURTNEY KELLN; MIKE K. VELDHUIS; PAUL SEXTON; JACKSON T. FRIESEN, et al., No. 1:21-cv-11276, District of Massachusetts (Aug. 12, 2021) — Complaint

UNITED STATES DISTRICT COURT
DISTRICT OF MASSACHUSETTS

SECURITIES AND EXCHANGE
COMMISSION,
    Plaintiff,
            v.

FREDERICK L. SHARP, ZHIYING
YVONNE GASARCH, COURTNEY
KELLN, MIKE K. VELDHUIS, PAUL
SEXTON, JACKSON T. FRIESEN,
WILLIAM T. KAITZ, AVTAR S.
DHILLON, and GRAHAM R. TAYLOR,

                                                Defendants.

Civil Action No. 21-CV-____
(___)

JURY TRIAL DEMANDED

COMPLAINT
 Plaintiff, Securities and Exchange Commission (the “Commission”), alleges the
following against defendants Frederick L. Sharp (“Sharp”), Zhiying Yvonne Gasarch
(“Gasarch”), Courtney Kelln (“Kelln”), Mike K. Veldhuis (“Veldhuis”), Paul Sexton (“Sexton”),
Jackson T. Friesen (“Friesen”), William T. Kaitz (“Kaitz”), Avtar S. Dhillon (“Dhillon”), and
Graham R. Taylor (“Taylor”) (collectively, the “Defendants”).
SUMMARY
1. This case concerns a sophisticated, multiyear, multi-national attack on the United
States financial markets and retail United States investors by foreign and domestic actors.  These
actors schemed to sell fraudulently hundreds of millions of dollars in stocks in the United States
markets.
2. In exchange for lucrative fees, a group headed by defendant Sharp provided
services to various groups of public company control persons to help those control persons dump

 
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United States-quoted stocks—typically penny stocks—on retail investors.  These services
included providing networks of offshore shell companies to conceal stock ownership, arranging
stock transfers and money transmittals, and providing encrypted accounting and communications
systems.
3. Other defendants named in this Complaint were control persons who dumped
their shares, a complicit public company chairman, and a promoter who touted the stocks to
retail investors.
4. The Defendants’ fraudulent conduct deprived investors of the full and fair
disclosure mandated by the federal securities laws.
Sharp’s, Kelln’s and Gasarch’s Participation in the Fraudulent Scheme
5. Beginning in or before 2010 and continuing through the present, Sharp, Gasarch,
and Kelln (the “Sharp Group”) were in the business of facilitating illegal stock sales in the public
securities markets.  The Sharp Group provided a variety of services to help corporate control
persons conceal their identities when selling the stock of penny stock companies they controlled.
By disguising their identities and their controlling positions, the Sharp Group’s clients
fraudulently concealed the fact that public company control persons were selling large blocks of
stock to investors.
6. The Sharp Group deliberately concealed the identities of its clients through the
array of services it offered, including forming and providing offshore nominee companies that
could hold shares for undisclosed control persons; providing and administering an encrypted
communication network; purchasing, configuring and delivering devices that the Sharp Group
referred to as “xPhones,” which were designed to be used only for communications on the Sharp
Group’s encrypted communications network; and arranging for clients to deposit stock in

 
3
 
offshore trading platforms, including Wintercap SA
1
 and Blacklight SA,
2
 both Swiss-based, to
obfuscate the control persons’ association with their public company stock.  The Sharp Group
also provided various additional services to its clients in furtherance of the fraudulent scheme
such as: administering a proprietary accounting system that tracked clients’ total stock holdings
and sales across various nominee shareholders and trading platforms; paying out the proceeds of
illegal stock sales at clients’ direction to accounts around the world; arranging to route such
payments by circuitous methods designed to conceal the source of funds; and fabricating
documents, such as invoices, to conceal the nature and source of the payments.
Veldhuis’, Sexton’s, and Friesen’s Participation in the Fraudulent Scheme
7. Working together, Veldhuis, Sexton, and Friesen (hereinafter referred to as the
“Veldhuis Control Group”) were one group of control persons (hereinafter referred to as a
“control group”) that teamed with the Sharp Group to run lucrative, fraudulent schemes to sell
stock surreptitiously in the public markets.
8. At various times, the Veldhuis Control Group collaborated with defendants
Dhillon, Taylor, and Kaitz.  In particular, the Veldhuis Control Group sold illegally the stock of
Stevia First Corp. (“Stevia First”), Stevia First’s successor company Vitality Biopharma, Inc.
(“Vitality”), Arch Therapeutics, Inc. (“Arch”), and OncoSec Medical Incorporated (“OncoSec”)
in concert with Dhillon.  The Veldhuis Control Group and Dhillon also sold illegally the stock of
Vitality and Arch in concert with Kaitz and Taylor.
                                                            
1
 The Commission charged Wintercap SA and its principal, Roger Knox, on October 2, 2018, with violating the
antifraud provisions of the Securities Act of 1933 (“Securities Act”) and Securities Exchange Act of 1934
(“Exchange Act”) as a result of engaging in a multiyear scheme that generated more than $165 million from the
illegal sale of stock of at least 50 publicly traded companies.
2
 The Commission charged Blacklight SA and its principals, Anthony Killarney and Kenneth Ciapala, on January 2,
2020 with violating the Securities Act and Exchange Act antifraud provisions as a result of engaging in a multiyear
scheme that generated more than $35 million from the illegal sale of stock of at least 45 publicly traded companies.

 
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Dhillon’s Role in the Scheme
9. Dhillon served as the chairman of the board of directors of Stevia First, Vitality,
Arch, and OncoSec.  Dhillon’s status as a high-level corporate insider enabled him to obtain
and/or direct the issuance of millions of shares of each company’s stock to his undisclosed
associates.  Dhillon knew that, because he was a corporate insider, federal securities laws
prohibited him from selling his stock into the securities markets without complying with various
registration and disclosure rules designed to protect investors.
10. At various times, Dhillon coordinated with the Veldhuis Control Group and
Taylor to sell surreptitiously stock in the companies atop whose boards he sat.  These sales were
conducted through various nominee shareholders and involved sales of stock that Dhillon was
legally prohibited from selling without registering the sales with the Commission.  In certain
instances, the nominee shareholders that effectuated the illegal sales of Dhillon’s shares included
entities administered by the Sharp Group.
11. Dhillon abused his senior corporate role—a position of trust and confidence—in
order to conceal his own and others’ fraudulent conduct from investors, securities market
intermediaries, securities regulators, and law enforcement.
Kaitz’s Role in the Scheme
12. Kaitz owned and operated Full Service Media LLC, a company that promoted the
stock of public companies to retail investors.  Kaitz substantially assisted the Veldhuis Control
Group by touting stocks that the Veldhuis Control Group sought to dump.  Kaitz promoted as
urgent and bullish investment opportunities the stock of various publicly traded companies that
the Veldhuis Control Group simultaneously planned to sell surreptitiously—including Vitality
and Arch stock.  A key component of Kaitz’s touting efforts was concealing the role of the

 
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Veldhuis Control Group, which paid Kaitz for his services.  For example, Kaitz falsely claimed
when touting the stock of public companies like Vitality that third parties (which appeared to be
unaffiliated with the public companies) paid for his services.  This concealment enabled the
Veldhuis Control Group to anonymously sell its stock to the investors whom it simultaneously
encouraged, through Kaitz’s stock promotional efforts, to buy the stock and thus trade in the very
opposite direction.
13. During an SEC investigation into one of the promotional campaigns Kaitz had run
for the Veldhuis Group, Kaitz appeared for testimony.  During that testimony, Kaitz made false
and misleading statements, including claims (i) that he had not received payment for the
promotion in question from any entity other than that identified as the paying party in the
promotion (despite having received such payments, arranged by Veldhuis, from other entities);
and (ii) that he had no communications devices other than the two he identified to Commission
staff (despite having had, and used in connection with the promotions in question, one of the
Sharp Group-supplied “xPhones” that are described below).
Taylor’s Role in the Scheme
14. Taylor, among other things, arranged to merge a public company with one of
Dhillon’s private companies, ultimately resulting in the distribution and fraudulent sale of shares
associated with the resulting public company, Stevia First.  Taylor also controlled nominee
shareholders who held and traded stock surreptitiously in concert with Dhillon and the Veldhuis
Control Group.  In exchange for these services, Taylor received a significant cut of the illegal
stock sale proceeds.

 
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Dhillon’s Additional Illegal Stock Sales through Person A’s Companies
15. At various times between 2011 and 2017, an individual identified herein as
Person A operated at least two nominee companies that he created to hold and trade stock of two
public companies atop whose boards Dhillon sat: Arch and OncoSec.  Person A illegally sold
shares in both Arch and OncoSec on Dhillon’s behalf.
Dhillon’s False Statements During the Commission’s Investigation
16. In October 2018, the Commission charged Wintercap SA—one of the Veldhuis
Control Group’s primary conduits for the illegal sale of stock—with engaging in securities fraud,
and Wintercap SA’s illegal sale of Vitality stock was cited in the Commission’s Complaint in
that action.  Early the following month, the Commission suspended trading in Vitality.  During
the Commission’s investigation leading to the filing of the instant action, the Commission sought
information from Dhillon about his involvement in the Vitality scheme, and Dhillon twice
appeared for testimony (in August 2019 and July 2020).  During that testimony, Dhillon made
false statements that are illustrated below.
The Defendants Violated Various Securities Laws
17. As a result of the conduct alleged herein, Sharp, Kelln, Veldhuis, Sexton, Friesen,
Dhillon, and Taylor violated Sections 17(a)(1) and (3) of the Securities Act of 1933 (“Securities
Act”) and Section 10(b) of the Securities Exchange Act of 1934 (“Exchange Act”) and Rules
10b-5(a) and (c) thereunder; Sharp, Kelln, Veldhuis, Sexton, Friesen, and Dhillon violated
Sections 5(a) and 5(c) of the Securities Act; Veldhuis, Sexton, and Friesen violated Section 13(d)
of the Exchange Act and Rule 13d-1 thereunder; Dhillon violated Sections 13(d) and 16(a) of the
Exchange Act and Rules 13d-2 and 16a-3 thereunder; Taylor violated Section 15(b) of the
Securities Act by aiding and abetting Dhillon’s violations of Sections 5(a) and 5(c) of the

 
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Securities Act; Sharp and Kelln violated Section 15(b) of the Securities Act and Section 20(e) of
the Exchange Act by aiding and abetting others’ violations of Sections 5(a), 5(c), 17(a)(1) and
17(a)(3) of the Securities Act and Section 10(b) of the Exchange Act and Rules 10b-5(a) and
10b-5(c) thereunder; Gasarch violated Section 17(a)(3) of the Securities Act, and also violated
Section 15(b) of the Securities Act and Section 20(e) of the Exchange Act by aiding and abetting
others’ violations of Sections 17(a)(1) and 17(a)(3) of the Securities Act and Section 10(b) of the
Exchange Act and Rules 10b-5(a) and 10b-5(c) thereunder; and Kaitz violated Section 17(a)(3)
of the Securities Act, and also violated Section 15(b) of the Securities Act and Section 20(e) of
the Exchange Act by aiding and abetting others’ violations of Sections 17(a)(1) and 17(a)(3) of
the Securities Act and Section 10(b) of the Exchange Act and Rules 10b-5(a) and 10b-5(c)
thereunder.
18. The Commission seeks a temporary restraining order prohibiting the Defendants
from future violations of Section 17(a) of the Securities Act and Section 10(b) of the Exchange
Act and Rule 10b-5 thereunder; prohibiting Veldhuis, Sexton, and Friesen from future violations
of Section 13(d) and Rule 13d-1 thereunder; prohibiting Dhillon from violations of Section 13(d)
of the Exchange Act and Rule 13d-2 thereunder; prohibiting Dhillon from future violations of
Exchange Act Section 16(a) and Rule 16a-3 thereunder; prohibiting Sharp, Kelln, Veldhuis,
Sexton, Friesen, Dhillon and Taylor from violations of Securities Act Sections 5(a) and 5(c), and
if entered, a preliminary injunction order for the same; and (ii) a repatriation order, and an order
freezing the assets of the Defendants held for their direct or indirect benefit, and/or subject to
their direct or indirect control.
19. The Commission seeks permanent injunctions against the Defendants, enjoining
them from engaging in the transactions, acts, practices, and courses of business alleged in this

 
8
 
Complaint; disgorgement of all ill-gotten gains from the unlawful conduct set forth in this
Complaint, together with prejudgment interest pursuant to Section 21(d) of the Exchange Act;
civil penalties pursuant to Section 20(d) of the Securities Act and Section 21(d)(3) of the
Exchange Act; an order barring the Defendants from participating in any offering of a penny
stock, pursuant to Section 20(g) of the Securities Act and/or Section 21(d) of the Exchange Act;
conduct-based injunctions enjoining the Defendants from directly or indirectly, including, but
not limited to, through an entity owned or controlled by any of them, participating in the
issuance, purchase, offer, or sale of any security; provided, however, that such injunction shall
not prevent defendants from purchasing or selling securities listed on a national securities
exchange for their own personal account; and such other relief as the Court may deem
appropriate.  Further, as to Dhillon, the Commission seeks an officer and director bar pursuant to
Section 20(e) of the Securities Act and Section 21(d) of the Exchange Act.
JURISDICTION AND VENUE
20. This Court has jurisdiction over this action pursuant to Section 22(a) of the
Securities Act [15 U.S.C. §77v(a)] and Sections 21(d), 21(e), and 27 of the Exchange Act [15
U.S.C. §§78u(d), 78u(e), 78aa].
21. Venue lies in this Court pursuant to Section 22(a) of the Securities Act [15 U.S.C.
§77v(a)] and Section 27 of the Exchange Act [15 U.S.C. §78aa].  Certain of the acts, practices,
transactions and courses of business alleged in this Complaint occurred within the District of
Massachusetts, and were affected, directly or indirectly, by making use of means or
instrumentalities of transportation or communication in interstate commerce, or the mails.  For
example, Dhillon sat atop the board of Arch, a Massachusetts-based issuer.

 
9
 
DEFENDANTS
22. Frederick L. Sharp, age 69 and born in Los Angeles, California, resides in West
Vancouver, British Columbia, Canada.
23. Zhiying Yvonne Gasarch a/k/a Zhiying Chen, age 49 and born in China, is a
dual citizen of Canada and China, and resides in Richmond, British Columbia, Canada.
24. Courtney Kelln, age 41, resides in Surrey, British Columbia, Canada.
25. Mike K. Veldhuis, age 41 and born in the Netherlands, resides in Vancouver,
Canada.
26. Paul Sexton, age 53 and born in the United Kingdom, resides in Anmore, British
Columbia, Canada.
27. Jackson T. Friesen, age 33, lives in Delta, British Columbia, Canada.
28. William T. Kaitz, age 40, lives in Arnold, Maryland.
29. Graham R. Taylor, age 51 and born in the United Kingdom, resides in
Vancouver, British Columbia, Canada on information and belief.
30. Avtar Singh Dhillon, MD, age 60 and born in India, is a Canadian citizen
residing in Long Beach, California.  Dhillon is currently the chairman of the board of directors of
Emerald Health Therapeutics, Inc., a Canadian company that publicly trades in the United States
markets.  Further:
a. Between approximately April 2013 and July 2018, Dhillon was the chairman of
the board of directors of Arch.
b. Between approximately March 2009 and January 2019, Dhillon was the chairman
of the board of directors of Inovio Pharmaceuticals, Inc. (“Inovio”).
c. Between approximately January 2012 and April 2019, Dhillon was the chairman

 
10
 
of the board of directors of Vitality, including its predecessor, Stevia First Corp.
d. Between approximately March 2011 and April 2020, Dhillon was the chairman of
the board of directors of OncoSec.
RELATED PARTIES
31. Vitality Biopharma, Inc. (“Vitality”), formerly known as Stevia First Corp.
(“Stevia First”), currently trades on the Over-the-Counter (“OTC”) Markets Group, Inc. (“OTC
Markets”), an interdealer quotation service that provides a platform to buy and sell securities.
Vitality was incorporated in Nevada in 2007 and its principal place of business is in Los
Angeles, California.  Throughout its history, Vitality has undergone several changes to its
business plan and now purports to be in the business of developing cannabinoid drugs for
medical treatment.  At all times relevant to this Complaint, Vitality’s common stock was
registered under Section 12(g) of the Exchange Act, and it files Exchange Act reports with the
Commission pursuant to the reporting requirements of Section 13(a) of the Exchange Act.
32. Arch Therapeutics Inc. (“Arch”) currently trades on OTC Markets.  It was
incorporated in Nevada in September 2009, and its principal place of business is in
Massachusetts.  The company has had different purported business objectives over the years; it
currently purports to be focused on “developing a novel approach to stop bleeding
(“hemostasis”), control leaking (“sealant”) and manage wounds during surgery, trauma and
interventional care.”  Arch’s common stock is, and has been since June 2013, registered with the
Commission pursuant to Section 12 of the Exchange Act.
33. OncoSec Medical Incorporated (“OncoSec”) currently trades on NASDAQ (to
which it was uplisted, from the OTC Markets, in May 2015).  It is a Nevada corporation
headquartered in Pennington, New Jersey and San Diego, California.  The company purports to

 
11
 
be a biotechnology company focused on designing, developing and commercializing innovative
therapies and proprietary medical approaches to stimulate and to guide an anti-tumor immune
response for the treatment of cancer.  OncoSec’s common stock is, and has been since March
2011, registered with the Commission pursuant to Section 12 of the Exchange Act.
34. Garmatex Holdings, Ltd. (“Garmatex”), now known as Evolution Blockchain
Group, Inc., currently trades in the grey market.  It was incorporated in Nevada in 2014 and is
located in Las Vegas, Nevada.  In 2018, the company announced a change in its business plan,
purportedly to pivot from textiles to holding intellectual property related to blockchain
technology, and changed its name to Evolution Blockchain.  The Commission suspended trading
in the securities of Evolution Blockchain on June 25, 2018.  During the time period of the trading
described in this Complaint, the company voluntarily filed periodic reports with the Commission.
BACKGROUND
35. Before selling stock, control persons are required to: (a) register such sales with
the Commission pursuant to Section 5 of the Securities Act [15 U.S.C. §77e]; (b) sell the stock
pursuant to an applicable exemption from registration; or (c) sell the stock pursuant to conditions
set forth in SEC Rule 144 [17 C.F.R. §240.144], including limitations on the amount of stock a
control person can legally sell.  In addition, investors in certain public companies are required
publicly to disclose any ownership interest in excess of 5% of the company’s publicly traded
stock.  Such registration requirements, sale restrictions, and disclosure obligations are safeguards
designed to protect the market for purchases and sales of stock, and to inform investors about the
nature of the stock they are holding or considering buying, and from whom they would be
buying that stock.
36. An “affiliate” of an issuer is a person or entity that, directly or indirectly through

 
12
 
one or more intermediaries, controls, is controlled by, or is under common control with, such
issuer (i.e., a control person).  “Control” means the power to direct management and policies of
the company in question.  Affiliates include officers, directors and controlling shareholders, as
well as any person who is under “common control” with or has common control of an issuer.  As
used herein, the term “control group” means a group that collectively is an “affiliate” of an
issuer.
37.  “Restricted stock” includes stock of a publicly traded company (also known as an
“issuer”) that has been acquired from an issuer, or an affiliate of an issuer, in a private
transaction that is not registered with the Commission.  All stock held by an issuer or affiliate of
an issuer is restricted stock.  Absent an exemption under the federal securities laws and rules,
restricted stock cannot legally be offered or sold to the public unless a registration statement has
been filed with the Commission (for an offer) or is in effect (for a sale).  A registration statement
contains important information about an issuer’s business operations, financial condition, results
of operation, risk factors, and management.  It also identifies any person or group who is the
beneficial owner of more than 5% of the company’s securities.
38.  “Unrestricted stock” is stock that may legally be offered and sold in the public
securities marketplace by a non-affiliate, ordinarily after having previously been subject to a
registration statement.  Registration statements are transaction specific, and apply to each
separate offer and sale as detailed in the registration statement.  Registration, therefore, does not
attach to the security itself, and registration at one stage for one party does not necessarily suffice
to register subsequent offers and sales by the same or different parties. Thus, when a control
person buys publicly traded or otherwise unrestricted shares in a company that s/he controls,
those shares automatically become subject to the legal restrictions on sales by an affiliate. Such

 
13
 
legal restrictions include strict limits on the quantity of shares that may be sold in the public
markets absent registration.  Without registration, affiliates are prohibited from selling large
quantities of an issuer’s shares, regardless of how the affiliates obtained those shares.
39. A “transfer agent” is a business that facilitates certain types of securities
transactions.  Among other things, transfer agents issue and cancel certificates of a company’s
stock to reflect changes in ownership.  Many companies that have publicly traded securities use
transfer agents to keep track of the individuals and entities that own their stock.  Transfer agents
routinely keep track of whether particular shares are restricted from resale.
40.  “Penny Stock,” as used herein, generally refers to a security issued by a very
small company that trades at less than $5 per share.
41. “S-1 Registration Statement(s)” refer(s) to SEC Form S-1, which is a registration
statement filed publicly by an issuer in connection with the sale of stock to shareholders. “S-1
Shareholders,” as used herein, means shareholders who acquired stock pursuant to an S-1
Registration Statement.
OVERVIEW OF THE SHARP GROUP’S CONDUCT
Obfuscating Beneficial Ownership and Control
42. From approximately 2010 through at least 2019, the Sharp Group facilitated
illegal sales of stock in hundreds of penny stock companies.
43. As reflected in the table below, the Sharp Group’s stock sales generated over one
billion dollars in gross proceeds:

 
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44. Sharp, who used the code name “Bond” (styling himself after the fictional
character James Bond), was the mastermind and leader of the Sharp Group.  Among other things,
Sharp cultivated relationships with the Sharp Group’s clients—that is, individuals seeking
fraudulently to sell stock in the markets to retail investors—and with various offshore trading
platforms.  Sharp also routinely served as a liaison between dozens of clients (like the Veldhuis
Control Group) and the trading platforms (like Wintercap SA).
45. During the period of the scheme detailed herein, Sharp described in a
communication to a client the following about the Sharp Group’s services: “The service provided
is comprehensive; it is not limited to trading.  It includes pyaments [sic], loans, private
placements and keeping clients out of jail.” (Emphasis added).
46. Sharp oversaw the creation and deployment of various front companies, which
served as nominee shareholders used to disguise his clients’ stock ownership and to sell stock
surreptitiously.
47. One of the services provided by the Sharp Group was making available offshore
corporate nominee shareholders and individuals who would serve as the nominal owners of those
entities.  Sharp installed these various nominal owners to pose as the beneficial owners of the

 
15
 
various entities that served as nominee shareholders.  In actuality, these individuals did not own
or control the stock held by the nominee shareholders and generally had no role other than
offering their names, passports, and signatures, which the Sharp Group used to incorporate and
open accounts for the corporate nominees.  In dealing with banks, brokerages, and other financial
services providers, these individuals were held out as actual beneficial owners.  In this way, the
Sharp Group kept the identities of control groups hidden, while fraudulently appearing to satisfy
the compliance requirements of the banking and securities firms where the Sharp Group opened
these accounts.
48. In 2002, Sharp wrote a fictionalized book about securities fraud and money
laundering in which he described illegal conduct that parallels the Sharp Group’s business
model.  Sharp’s book (Footloose:  Charlie Smith’s Offshore Chronicles) includes the following
passage:
Eventually [the client] took greater positions in the stocks, sharing the
take with fewer partners.  This meant he had to disguise his
shareholdings in order to avoid securities disclosure requirements and
trading restrictions.
Offshore companies were ideal for his purpose.  They came from
around the world with nominee directors, but were still subject to his
control.  The perfect situation for his masterly stock manipulations.
49. Sharp hired and directed various individuals to operate the administrative services
offered by the Sharp Group.  For example, Sharp oversaw the creation of a network of encrypted
communications, including code-names for the users, encrypted electronic chat functions, and
encrypted email functions.
3
  The Sharp Group purchased, configured and delivered devices that
                                                            
3
 Encrypted communications sent and received through the Sharp Group-administered server are hereinafter referred
to as “Encrypted Communication(s).”

 
16
 
the Sharp Group referred to as “xPhones,” which were designed to be used only for the
Encrypted Communications.
50. Sharp also hired and directed individuals who created and administered the Sharp
Group’s accounting system, which Sharp called “Q” (thereby expanding his James Bond
affectations – “Q” being another fictional character in James Bond).  Given the extensive efforts
by the Sharp Group and its clients to conceal and obscure the actual ownership and control of the
stock they were surreptitiously selling, the Q system was essential in keeping track of the
amounts of stock to be sold and the total proceeds being collected for each deal Sharp’s clients
ran.  Accordingly, the Sharp Group accounted for all of the nominee shareholders’ assets in Q by
tracking which of the nominee shareholders held which stocks (and which stocks’ sales
proceeds) for which particular client or client group, like the Veldhuis Control Group.  The
Sharp Group also relied on the Q system to calculate the commissions and fees it collected for
facilitating its clients’ illegal stock sales.
51. Sharp arranged for the Encrypted Communication services and the Q accounting
system to be hosted on a server that was physically located on the island of Curaçao, in the belief
that, there, it would be unreachable by U.S. securities regulators and law enforcement officials.
52. Kelln is one of the individuals who worked for Sharp.  Kelln routinely performed
a variety of complex administrative tasks associated with obtaining, allocating, and distributing
blocks of shares across multiple nominee shareholders in a manner designed to conceal the Sharp
Group’s clients’ common control of all the stock so distributed.
53. In particular, Kelln—at the direction of Sharp and others—routinely split Sharp
Group clients’ shareholdings into blocks of stock, each comprising less than five percent of each
public company’s outstanding shares, to be held in the names of various nominee entities.  Kelln

 
17
 
sent an Encrypted Communication on or about February 8, 2013 to a client describing her work:
The process is: I group certs [stock certificates] together that keep the total under 5%.
Then I sen[d] them in for transfer to the TA [transfer agent].  Once processed the TA
fedex’s them to the broker.  Then we wait for the shares to clear [i.e., become available
for trading].  We only submit 1 transfer a day per broker until we have submitted all the
shares.

54. These acts enabled the Sharp Group’s clients to further conceal their control by
making it seem as if multiple different, unrelated offshore corporate entities each held less than
five percent of the stock of a public company when, in actuality, those offshore corporate entities
were all under common control by the Sharp Group, and their stock in the public company was
all held in coordinated fashion for the benefit of the Sharp Group’s clients. In this manner, the
clients concealed the fact that they routinely held far greater than five percent of such public
companies’ stock through the various Sharp Group-supplied nominee entities.
55. Breaking the shares into blocks of less than five percent avoided scrutiny by
brokerage firms and other market participants.  Brokerage firms routinely consider the 5%
ownership threshold in determining whether particular stock sales may be part of a distribution
that must be registered pursuant to Section 5 of the Securities Act.  Further, the OTC Markets
requires public companies to disclose its five percent (or greater) shareholders to meet certain
listing requirements.
56. Once blocks of shares were broken up and dispersed among multiple nominee
shareholders, the Sharp Group coordinated with offshore trading platforms, such as Wintercap
SA and Blacklight SA, which specialized in depositing and liquidating stock through various
domestic and foreign brokerage firms.  By so doing, the Sharp Group further obscured both the
identities of the true beneficial owners and the fact that they were selling in concert.
57. Gasarch is another one of the individuals who worked for Sharp.  Her duties

 
18
 
included arranging for transfers—typically in the form of wire transfers—of the proceeds of
illegal stock sales, such as the sales referenced in the table appearing at ¶ 43 above.  In this role,
Gasarch routinely arranged to transfer stock sale proceeds to accounts as directed by the Sharp
Group’s clients in a manner designed to conceal the fact that undisclosed control persons were,
in fact, the actual beneficial owners of the stock being sold, and the ultimate recipients of the
sales proceeds.  Because of her role, Gasarch was routinely referred to by others involved in the
scheme by the nickname “Wires.”
58. Gasarch also implemented Sharp’s plan to protect the identities of the Sharp
Group’s clients.  For example, (a) Gasarch helped to disguise the identities of actual shareholders
by personally serving as the purported owner of a nominee shareholder—Peregrine Capital Corp.
f/k/a Peaceful Lion Holdings—that the Sharp Group routinely used to facilitate the illegal stock
sales on behalf of control group clients; and (b) in late 2015, around the time the Sharp Group
distributed to clients a new set of xPhones for their use in Encrypted Communications, Gasarch
drafted a memo with instructions about how to “delete all secure chats when xphone is shut
down (e.g., to cross a border).”
59. Kelln likewise made it a point to remind Wintercap SA principals of these
security protocols, as in a November 2016 Encrypted Communication in which she noted, after
traveling back to Canada from Switzerland, “I had to delete my phone going through customs.”
A Wintercap SA principal responded “[w]e approve of your security.”
The Sharp Group Benefited from Illegal Stock Sales
60. Sharp, Kelln, and Gasarch profited handsomely from their illicit services to the
Sharp Group’s clients.
61. For example, between just August 2017 and July 2018, Wintercap SA transferred

 
19
 
approximately $7 million to a Marshall Islands company called Cortona Equity, Inc. (“Cortona”)
for Sharp’s benefit.  Sharp had installed his wife’s tennis coach as the purported beneficial owner
of Cortona.
62. On various dates between 2010 and 2019, Kelln and Gasarch were the
beneficiaries of more than $1 million each of funds derived from the Sharp Group’s conduct.
SHARP GROUP EXAMPLE ONE:
ILLEGAL SALES OF STEVIA FIRST/VITALITY BY DHILLON,
VELDHUIS CONTROL GROUP AND TAYLOR

63. By August 2011, Dhillon had become the Interim Principal Executive and
Financial Officer of Stevia First and, by January 2012, had become its Chairman.  As detailed
below, during and after his securing of these roles, Dhillon coordinated with the Veldhuis
Control Group and Taylor fraudulently to sell Stevia First/Vitality
4
 stock to retail investors at
inflated prices on various occasions over several years.  Further, Sharp, Kelln, Veldhuis, Friesen,
Sexton, Taylor and Dhillon failed to register their sales of Stevia First/Vitality stock described
herein pursuant to Section 5 of the Securities Act.
64. Defendants’ successive campaigns to sell Stevia First/Vitality stock fraudulently
were very successful.  The following table reflects the proceeds that several of the Defendants’
illicit sales of Stevia First/Vitality stock generated during the scheme (the “quantity sold” in the
table below reflects the number of shares sold, and incorporates a 1-for-10 reverse stock split in
2016).
                                                            
4
 Stevia First changed its name to Vitality in 2016, and the company still operates under that name.  Stevia First and
Vitality stock is referred to as “Stevia First/Vitality” in this Complaint.

 
20
 

Background
65. By early 2011, Dhillon controlled a private company called Stevia First.  Around
that time, Dhillon looked for an opportunity to convert that business to a publicly traded
company in a process known as a “reverse merger.”  In a reverse merger transaction, an existing
public company having a ticker symbol cleared for quoting on OTC Markets, but with little, if
any, operations (often referred to as a “shell company”), acquires a private operating company.
After the private operating company is absorbed into the public shell company, the shell
company typically undergoes a name, ticker-symbol, and business-plan change, to align with the
name and purported business of the formerly private operating company.  In such transactions,
shareholders of the formerly private company frequently receive shares in the newly merged
public company.  In many instances, those shares comprise a controlling interest in the post-
merger public company.
66. In or about early 2011, Taylor introduced Dhillon and the then-Chief Executive
Officer (the “CEO”) of Dhillon’s private company to certain of Taylor’s contacts in China and to
an attorney in Vancouver.  Dhillon and the CEO eventually merged the private company with a
public shell company.  On paper, the bulk of the shares in the shell company were held by

 
21
 
various Chinese nationals who were identified in an S-1 registration statement that had
previously been filed by the shell company (hereinafter the “Stevia S-1 Shareholders”).
67. According to public filings, on July 28, 2011, the purported president, chief
executive officer, treasurer and director of the public shell company agreed to sell all of his
4,500,000 shares to Dhillon pursuant to a stock purchase agreement.  The stock purchase
agreement contemplated that, immediately upon closing of the reverse merger, Dhillon would be
appointed as a director, and as the President, Chief Executive Officer, Secretary, and Treasurer,
of the surviving public company.
68. On or about October 10, 2011, the reverse merger went effective and the
surviving public company was re-named Stevia First, thereby assuming the name of Dhillon’s
private company.
69. On or about October 12, 2011, Stevia First effected a 7-for-1 forward stock split,
which caused Dhillon’s 4,500,000 shares (referenced in ¶ 67) to convert to 31,500,000 shares of
Stevia First/Vitality stock.
70. Dhillon was the sole signer of Stevia First’s filing with the Commission, which
reported the 7-for-1 forward stock split.  The stock split had the effect of increasing the number
of shares held by Dhillon considerably.
71. In or about January 2012, Dhillon assumed the role of chairman of Stevia First’s
board of directors.  Stevia First/Vitality’s stock was registered pursuant to Section 12 of the
Exchange Act.
72. Dhillon was an affiliate of Stevia First (and, subsequently, Vitality) because he
had the power to control the company through his role as chairman of its board.  As a public
company affiliate, Dhillon was legally required to register any sales of his Stevia First/Vitality

 
22
 
stock unless Dhillon elected to comply with the safe harbor provisions set forth in Commission
Rule 144.  Dhillon testified, under oath, during the Commission’s investigation leading to the
filing of this action that he understood these legal requirements at all times relevant to this
Complaint.  As described in more detail in this Complaint, Dhillon repeatedly sold shares of
Stevia First/Vitality without registering such sales.
73. As a director of Stevia First (and, eventually, Vitality), Dhillon was required to
file various “Form 4” statements (i.e., a “Statement of Changes of Beneficial Ownership of
Securities”), which is a public form required by the Commission pursuant to Section 16(a) of the
Exchange Act and Rule 16a-3 thereunder.  Dhillon was required to file an updated Form 4 to
reflect any change in his beneficial ownership of Stevia First/Vitality stock, regardless of the
amount of that change.  Dhillon understood these legal requirements at all times relevant to this
Complaint.  Dhillon testified, under oath, during the Commission’s investigation leading to the
filing of this action that “[a]nytime there’s sales by insiders, you have to file appropriate forms to
disclose your purchases or sales.”
74. Dhillon was also legally required to file a public disclosure report—a “Schedule
13D”—with the Commission pursuant to Section 13(d) of the Exchange Act and Rules 13d-1
and 13d-2 thereunder, to the extent he was the beneficial owner of greater than five percent of
Stevia First/Vitality’s common stock.  Dhillon was likewise required to disclose, via a Schedule
13D filing, any agreements he entered into concerning disposition of Stevia First stock, as well
as the combined holdings of all participants in any such agreements.  Dhillon was further
required to file a Schedule 13D Amendment whenever his position materially changed.  Dhillon
understood these legal requirements at all times relevant to this Complaint.  For example, on or
about August 17, 2011, Dhillon filed a Schedule 13D with the Commission disclosing that he

 
23
 
was the beneficial owner of 4,500,000 restricted shares of Stevia First/Vitality stock, which
comprised more than five percent of the company’s outstanding common shares at that time.  As
described in more detail in this Complaint, Dhillon intentionally failed to disclose his beneficial
ownership interest in additional shares of Stevia First/Vitality stock, which were purportedly
unrestricted; and he never made any disclosure concerning his agreements with the Veldhuis
Group concerning Stevia First stock.
Round One: 2012 Stevia First/Vitality Stock Sales
75. Beginning in January 2012, shortly after Dhillon took over Stevia First, Dhillon,
Taylor, and the Veldhuis Control Group arranged to sell surreptitiously Stevia First/Vitality’s
purportedly unrestricted stock and share in the proceeds of those unregistered sales.
76. First, Taylor, working in concert with others, facilitated the transfer of Stevia
First/Vitality’s purportedly unrestricted stock from the Stevia S-1 Shareholders (defined in ¶ 66)
to, initially, fifteen Sharp Group-administered nominee companies that held the stock for the
Veldhuis Control Group.  Shortly thereafter, the Sharp Group consolidated or further transferred
shares held by several of these Sharp Group-administered shareholders into other Sharp Group-
administered shareholders, including Peaceful Lion Holdings, a nominee shareholder for which
Gasarch personally served as purported owner, and thus as purported owner of any shares held
by it.  The flow chart below reflects these transfers:
5

                                                            
5
 The entities color coded in green in this chart and other charts within this Complaint were administered or
otherwise utilized, directly or indirectly, by the Sharp Group.

 
24
 

77. Between January and March 2012, the Sharp Group-administered nominee
shareholders (including Gasarch’s Peaceful Lion Holdings) received 19,600,000 shares of Stevia
First/Vitality stock, representing over 37% of the company’s total outstanding stock and over
97% of its purportedly unrestricted stock.  These particular shares, which were all issued without
restrictive legend, are hereinafter referred to as the “‘Unrestricted’ Stevia First Merger Shares.”
(Shares issued without restrictive legend are commonly treated by securities brokers and transfer
agents as immediately and freely tradeable.  In reality, however, these ‘Unrestricted’ Stevia First
Merger Shares were held by affiliates of the issuer who were acting in league with its Chairman.

 
25
 
As such, these shares were, as a matter of law, restricted, and thus were subject to the federal
securities laws’ limitations and restrictions on unregistered sales of such shares.)
78. In March 2012, Stevia First—with Dhillon serving as the chairman of its board of
directors—began to issue press releases claiming various positive business developments for the
company while, at or about the same time, the Veldhuis Control Group orchestrated a
promotional campaign touting Stevia First’s stock.
79. For example, the Veldhuis Control Group paid for promotional materials touting
Stevia First that were disseminated to investors during approximately March through May 2012.
These Stevia First promotional materials urged investors to buy and buy quickly, saying things
like, “Get in now; this is huge!” (emphasis in original) and “Buy STVF right now!” (emphasis
in original; “STVF” was Stevia First’s ticker symbol).  These promotional materials
misleadingly claimed both that “Conmar Capital Inc.” was the paying party, and that Conmar
Capital “will not trade in the securities of Stevia First.”  In fact (i) it was the Veldhuis Group,
which controlled the overwhelming majority of Stevia First’s free-trading shares, that paid for
the promotions; (ii) the Veldhuis Control Group had paid the Sharp Group to incorporate
Conmar Capital; and (iii) although no Stevia First trading took place (at the time of the
campaign) through Conmar Capital, the Veldhuis Control Group was indeed “trad[ing] in the
securities of Stevia First” by massively unloading them on the very retail investors who were
buying in response to that campaign.
80. The Veldhuis Control Group also engaged Kaitz to promote Stevia First,
including through paying Kaitz’s stock promotion company over $200,000 on or about April 3,
2012.

 
26
 
81. Overall, from approximately March 6, 2012 to May 23, 2012, the Veldhuis
Control Group, with Kaitz’s substantial assistance, unloaded every share of the ‘Unrestricted’
Stevia First Merger Shares into the market, generating illicit proceeds of over $24 million.
82. Both Taylor and Dhillon contemporaneously shared in the illicit proceeds
stemming from the Veldhuis Control Group’s March-May 2012 lucrative unloading of Stevia
First stock, described above.  In particular, between approximately April and June 2012, the
Veldhuis Control Group used the Sharp Group to remit eight wire payments, all funded by Stevia
First stock-sale proceeds, and totaling over $4.2 million, to the Swiss bank account of an
offshore front company that Taylor controlled; and Taylor, in turn, promptly transferred over
60% of that money to Dhillon as follows:
Date Veldhuis Control Group
Transfers to Taylor’s
Company
Taylor Transfers to
Dhillon’s Companies
April 12, 2012 $610,200
April 12, 2012 $498,900
April 13, 2012 $496,800
April 17, 2012  $498,000
May 4, 2012  $400,000*
May 11, 2012  $496,000*
June 8, 2012 $475,000
June 8, 2012 $800,000
June 8, 2012 $900,000
July 16, 2012  $1,300,000*
*Each of these transfers went to the Swiss bank account of a front company incorporated in
Panama called Ortivo Enterprises Corp. (“Ortivo”) that Dhillon controlled.

83. To further conceal the identities of the people sharing in the illicit proceeds from
the unregistered sale of the ‘Unrestricted’ Stevia First Merger Shares, as well as the illicit source
of those proceeds, the Veldhuis Control Group distributed portions of those proceeds in cash
obtained from the Sharp Group on various dates.  These cash withdrawals were recorded in the Q
system and allocated to the Stevia First deal.

 
27
 
Round Two: 2014 Stevia First/Vitality Stock Sales
84. On or about March 30, 2012, May 25, 2012, and February 13, 2014, Stevia First
issued a total of 1,320,511 shares of Stevia First/Vitality stock to a Sharp Group-administered
nominee shareholder.  The Sharp Group, in turn, divided those shares between two additional
Sharp Group-administered nominee shareholders.  The table below reflects these transfers.

85. Thereafter, the Veldhuis Control Group sold these shares through Sharp Group-
administered nominee shareholders for the benefit of Dhillon, the Veldhuis Control Group, and
Taylor.  Specifically, between approximately January 14, 2014 and July 14, 2014, the Veldhuis
Control Group sold all 1,320,511 of these Stevia First/Vitality shares through at least two
offshore brokerage firms, obscuring the shares’ ownership and the disposition of their proceeds
by running the trades through two Sharp Group-administered nominee shareholders.
86. Kelln facilitated the unregistered sale of the 1,320,511 Stevia First/Vitality shares.
For example, on or about October 9, 2013, Kelln provided Stevia First’s transfer agent with the
required paperwork to transfer 625,000 of the 1,320,511 shares of Stevia First/Vitality shares to
Nautilus Growth Fund.  Kelln also provided a check to pay for the transfer.  The documents
provided by Kelln to Stevia First’s transfer agent included an attorney opinion letter that falsely
represented that Nautilus Growth Fund was not an affiliate of Stevia First.  Kelln knew, or

 
28
 
recklessly disregarded, that Nautilus Growth Fund was merely a nominee shareholder holding
stock for the Veldhuis Control Group, which was an affiliate of Stevia First.
87. As the Veldhuis Control Group sold shares, Veldhuis, Sexton, and Friesen
discussed distributing the proceeds from the sale of the 1,320,511 shares of Stevia First/Vitality
stock in a furtive manner that was designed to conceal the funds’ source as well as their ultimate
recipients.
88. For example, on or about February 25, 2014, Sexton and Veldhuis discussed in an
Encrypted Communication their plan to distribute a pool of proceeds from the sale of the
1,320,511 shares of Stevia First/Vitality stock in “cash” and noted that “AV will be fine with
[our so distributing] it.”  “AV” is a reference to Avtar Dhillon.
89. On or about March 6, 2014, Veldhuis sent the following Encrypted
Communication to Friesen: “u r getting 173k today.  A cut from MDDD [the ticker symbol of
another public company stock the Veldhuis Control Group fraudulently sold through the Sharp
Group] and STVF [the ticker symbol of Stevia First in 2014].  Buy a boat [expletive].  Rich
mother [expletive].”  Of the “173k” (i.e. $173,000) referred to by Veldhuis in the Encrypted
Communication to Friesen, $100,000 came from proceeds of selling the 1,320,511 shares of
Stevia First/Vitality stock.
90. On or about March 6, 2014—around the same time that Veldhuis was
coordinating the distribution of Stevia First/Vitality stock sale proceeds to Friesen (and others)—
the Veldhuis Control Group caused the Sharp Group to send $124,000 in Stevia First/Vitality
stock-sale proceeds to the same Taylor Swiss bank account referenced in ¶ 82 above.
91. On various dates later in 2014, the Veldhuis Control Group continued to sell
Stevia First/Vitality stock.  For example:

 
29
 
a. On or about May 28, 2014, Friesen sent an Encrypted Communication,
copying Veldhuis, directing a trader working for Sharp to sell 25,000 shares of
Stevia First/Vitality stock that was held in an account in the name of a Sharp
Group-administered nominee shareholder.
b. On or about July 7, 2014, Friesen sent an Encrypted Communication directing
a trader working for Sharp to sell 25,000 shares of Stevia First/Vitality stock.
92. On or about August 5, 2014, Veldhuis sent an Encrypted Communication asking
Gasarch the following: “How much cash do you have in total.  We might cut the balance of
STVF [Stevia First] that’s left.  So we would need about $110K.  Do you have or be able to get?”
93. On or about August 6, 2014, Veldhuis sent a follow up Encrypted Communication
to Gasarch: “Can I please get $120K cash from STVF?”
94. On or about August 6, 2014, Veldhuis picked up $120,000 in cash from Sharp’s
office.
95. On or about August 6, 2014, Sexton and Veldhuis continued to discuss, via
Encrypted Communications, the planned distribution of proceeds from selling the 1,320,511
shares of Stevia First/Vitality stock.  Veldhuis wrote: “so STVF with the two wires being added
back is 126,693.74 . . . Avtar 50,000 (40%) . . . [there is] enough cash to do it might [sic] be
easier to transfer.”
96. During the same August 6, 2014 Encrypted Communication, Sexton replied:
“You should cut up the 120,000 [in] cash.  Which would allow for . . . Avtar/GT [Dhillon and
Taylor] 42,000[.] So if you want to bring me 96k on Friday I can distribute?  GT [Taylor] will be
up here shortly . . . .”

 
30
 
97. During the same August 6, 2014 Encrypted Communication, Veldhuis asked
Sexton how he should transmit the cash, writing, “U want me to put in the safety deposit box or
bring it to you.”  Sexton replied: “You can do either.  I have a safe here.  I can distribute mind
[sic] and grahams [Taylor] from here.  I can hold . . . av’s [Avtar Dhillon’s] for next meeting.”
98. On or about August 7, 2014, Veldhuis reported to Sexton via an Encrypted
Communication that “I pick up [sic] that cash yesterday.  Its [sic] all 50’s.”
99. Similarly, between approximately November 2013 and January 2015, Taylor
arranged to transfer approximately $1.7 million to third parties for Dhillon’s benefit.
100. Dhillon failed to file any Form 4 disclosing the sales of Stevia First stock directed
by the Veldhuis Control Group, despite having a pecuniary interest in Stevia First stock sales
effected through the Veldhuis Group, and despite knowing of his obligations, as Chairman of
Stevia First, to report any and all of his Stevia First stock sales on Forms 4 filed with the
Commission.
Round Three:  2015 and 2016 Stevia First/Vitality Stock Sales
101. In connection with the 2011 merger of Dhillon’s private company into the public
shell company, Dhillon received 4,500,000 restricted shares of Stevia First/Vitality stock
(hereinafter referred to as the “March 2012 Stevia First/Vitality Stock”).  After Stevia First,
directed by Dhillon, issued a 7-for-1 forward split of Stevia First/Vitality stock, Dhillon held
31,500,000 shares of the March 2012 Stevia First/Vitality Stock, all of which was restricted.
102. The scheme by the Veldhuis Control Group, Taylor and Dhillon to unload this
March 2012 Stevia First/Vitality Stock through another round of illicit stock sales began in
March 2012.

 
31
 
103. The first step in this facet of the scheme was to move Stevia First/Vitality stock
into the hands of the Veldhuis Control Group, while concealing the common ownership and
control of this large block of shares.
104. As with prior illegal sales of Stevia First/Vitality stock, several of the Defendants
used multiple Sharp Group-supplied entities as nominee shareholders, each purporting to hold
less than 5% of the company’s shares, in order to conceal the fact that affiliates of the issuer
were, in concert, controlling, and would be illegally selling, unregistered shares of Stevia
First/Vitality stock.
105. To that end, in or about March 2012 (i) Sharp authorized, through a wire request
he signed, a payment to Dhillon in the amount of $33,800, and (ii) Taylor also directed two
payments totaling $9,450 to Dhillon.  These payments were all made to Dhillon’s personal bank
account.
106. Sharp’s March 2012 $33,800 payment to Dhillon—which was funded by
proceeds from the Veldhuis Control Group’s sale of the ‘Unrestricted’ Stevia First/Vitality
Merger Shares earlier that month—was for the purchase of 15,750,000 shares of Dhillon’s
March 2012 Stevia First/Vitality Stock.  Meanwhile, Taylor’s March 2012 payments (for a total
of $9,450) were for the purported purchase of another 4,227,500 shares of Dhillon’s March 2012
Stevia First/Vitality Stock.
107. To conceal the common control and disposition of the roughly 20 million shares
of March 2012 Stevia First/Vitality Stock shares that Dhillon had transferred based on the
aforementioned Sharp- and Taylor-arranged payments, Dhillon disguised his transfers as a series
of smaller sales to (i) various Sharp Group-administered shareholders—all of which would hold,
and ultimately sell, the Stevia First/Vitality stock for the benefit of the Veldhuis Control Group

 
32
 
and Dhillon—and (ii) two nominee shareholders that were controlled by Taylor, which would
hold, and ultimately sell, the Stevia First/Vitality stock for Taylor’s and Dhillon’s benefit.  The
chart below illustrates Dhillon’s sale of these shares, as well as Dhillon’s division of the
remaining shares that were derived from the March 2012 Stevia First/Vitality Stock.  (In fact,
however, as detailed below, Dhillon did not fully relinquish his interest in the March 2012 Stevia
First/Vitality Stock.):
6

                                                            
6
 Heng Hong is another nominee shareholder controlled by Taylor.

 
33
 
108. The roughly 20 million shares of the March 2012 Stevia First/Vitality Stock that
Dhillon transferred to nominee shareholders administered by the Sharp Group or Taylor
comprised approximately 39 percent of the company’s outstanding shares.  But, by spreading
these shares among various nominee shareholders, each shown as holding under five percent of
the company’s outstanding shares, Dhillon obscured the facts that (i) he had not, in truth,
relinquished his interests in all of these shares; and (ii) these shares were, in truth, held by the
Veldhuis Control Group, himself, and Taylor, all of whom were acting in concert.
109. The Veldhuis Control Group and Taylor did not immediately sell the shares held
by the nominee shareholders referenced in ¶ 107 above, at least partly because the stock was
initially marked as restricted by Stevia First’s transfer agent since it was acquired directly from
Dhillon, an affiliate of the company.  SEC Rule 144 provides a safe harbor from registering the
sale of restricted stock acquired directly from an affiliate if, among other things, the acquirer(s)
hold those shares for at least six months.  In the meantime, the Veldhuis Control Group sold the
other Stevia First/Vitality stock that they had obtained, as described in ¶¶ 76 through 77 (“Round
1”) and ¶¶ 84 through 85 (“Round 2”), above.
110. Beginning in the fall of 2014, the Veldhuis Control Group arranged for the
unregistered sale of the March 2012 Stevia First/Vitality Stock in concert with Taylor and
Dhillon.
111. In an Encrypted Communication on or about October 24, 2014, Veldhuis, Sexton
and Friesen discussed their plans to sell the March 2012 Stevia First/Vitality Stock into the
public markets.  In particular, Sexton summarized the Veldhuis Control Group’s plans to sell the
15,750,000 shares that Dhillon had transferred to the various Sharp Group-administered nominee
shareholders, which included 1,000,000 shares to be sold for Dhillon’s benefit, and raised the

 
34
 
possibility of coordinating those sales with sales of the shares Dhillon had transferred to Taylor’s
nominee shareholders, writing: “There was 31,500,000 in total. We have 15,750,000 minus the
1mm to Avtar [Dhillon].  GTaylor is outside the 15.75.  He would consider blending back if Av
[Dhillon] agrees to the plan.”  (Emphasis added).
112. Taylor, as illustrated in ¶ 106 above, held approximately 4.2 million additional
shares via two nominee shareholders, which is consistent with Sexton’s referring to Taylor’s
position, in the above-quoted Encrypted Communication, as “outside the 15.75” million shares
held by various Sharp Group-administered nominee shareholders.
113. On or about October 28, 2014, Sexton met with Dhillon in California, and
summarized their meeting in an Encrypted Communication between Sexton and Veldhuis the
following day in these words:
a. Dhillon “said that stv [Stevia First] is working 2 big food producers and they
feel that one has a very good chance to come to table.  He would like to be
more aggressive and get the price and volume up. . . . He’s also sharing in part
of grahams [Taylor’s] retained [sic] position.”
b. “Also, av [Dhillon] said that he would prefer if we took the shares in gt
[Taylor’s] names and sold them all together.  Lol.”
114. On various dates thereafter, Taylor, directly or indirectly, transferred the March
2012 Stevia First/Vitality Stock held by his two nominee shareholders to Sharp Group-
administered nominee shareholders that were used by the Veldhuis Control Group.  For its part,
in or about December 2014, the Veldhuis Control Group arranged to sell March 2012 Stevia
First/Vitality Stock through Wintercap SA and Blacklight SA using Sharp Group-administered

 
35
 
nominee shareholders.  The chart below reflects the transfers to various Sharp Group-
administered nominee shareholders:

115. On or about December 2, 2014, Veldhuis sent an Encrypted Communication to
Gasarch, copying Sharp, to determine if the nominee shareholders his team had been using to
hold March 2012 Stevia First/Vitality Stock were administered by the Sharp Group, or some

 
36
 
other offshore nominee shareholder provider.  Veldhuis wrote: “[w]e are in the process of
receiving approximately 20 million shares of [Vitality] that were held in ESCROW.  At the time
of ESCROW agreement we may have put some of the stock in NON BOND [i.e. non-Sharp]
[nominee] entities.  Can you please go through the list below and let me know which entities you
guys administer.”  (Veldhuis’s reference to “approximately 20 million” comports with the sum of
(i) the 15,750,000 shares of March 2012 Stevia First/Vitality Stock that Dhillon transferred to the
various Sharp Group-administered nominee shareholders in 2012, plus (ii) the approximately 4.2
million shares of March 2012 Stevia First/Vitality Stock that Dhillon transferred to two nominee
shareholders controlled by Taylor.)
116. Sharp, copying Kelln, replied to Veldhuis’s December 2, 2014 Encrypted
Communication by writing: “This [message] shld have gone to celtic.”  “Celtic” was Kelln’s
pseudonym.  Kelln promptly replied: “I confirm they [nominee shareholders] are all ours [i.e,
Sharp Group-administered nominee shareholders].”
117.   Kelln subsequently arranged for the Veldhuis Control Group’s stock, which now
included the approximately 4.2 million shares initially held by Taylor’s two nominee
shareholders, to be deposited into accounts controlled by Wintercap SA and Blacklight SA.
118. Thereafter, during the course of 2015 and early 2016, the Veldhuis Control Group
directed the unregistered sales of March 2012 Stevia First/Vitality Stock in coordination with
another stock promotional campaign run by Kaitz.
119. In or about January 2015, via an Encrypted Communication, Veldhuis asked
Kaitz who Kaitz would identify as the “third party” payer on the Stevia First/Vitality stock
promotional alerts.  Kaitz replied, “Conmar Capital,” which was the name of a Sharp Group-
administered entity that the Veldhuis Control Group had paid to incorporate in 2012.  Ultimately,

 
37
 
the January 2015 promotions identified “Full Service Media” (Kaitz’s own company), as well as
an unidentified “third party,” as each having supplied funds to pay for those stock promotions.
Kaitz knew that the Veldhuis Control Group was paying for the stock promotions and concealed
this by listing “Conmar Capital” as the party paying for his promotional campaign.  Kaitz further
knew, or recklessly disregarded, that the Veldhuis Control Group intended to sell stock
surreptitiously and was paying for the promotional campaign in order to facilitate such sales.
120. The members of the Veldhuis Control Group each knew or recklessly disregarded
that stock promoters, like Kaitz, falsely identified third party payers in order to conceal the fact
that control groups and other affiliates were sponsoring promotional campaigns in order to
surreptitiously dump stock in the markets.  Similarly, Dhillon and Taylor knew, or recklessly
disregarded, that the Veldhuis Control Group would retain a stock promoter to tout Stevia
First/Vitality stock and would conceal (i) their role in funding the stock promotional campaign,
(ii) the fact that they were part of a group that controlled the issuer, and (iii) the fact that they
intended to trade, and were trading, in the opposite direction to which the touts urged retail
investors to trade.
121. On or about March 13, 2015, Sexton and Veldhuis exchanged Encrypted
Communications concerning Dhillon and continuing the Stevia First/Vitality stock promotion:
Sexton to Veldhuis: “Avtar said they got additional things going for stvf [the ticker
symbol for Stevia First at the time].  To keep going with [a stock promoter] and they only
have another 1mm to chew thru and it should clean up real nice.

Veldhuis to Sexton: “Nice.”
122. Veldhuis, on behalf of Dhillon, the Veldhuis Control Group, and Taylor,
continued to orchestrate stock promotions concerning Stevia First/Vitality stock later in 2015.
To that end, Veldhuis sought to identify a nominee entity that could be cited as the paying party

 
38
 
for the promotional campaign in order to conceal the fact that the Veldhuis Control Group
actually paid for the stock promotional campaign.
123. For example, on or about March 31, 2015, Veldhuis sent an Encrypted
Communication, subject line “promo,” to Sharp asking if one of eight Sharp Group-administered
nominees “can be used . . . as the payee [sic] for the promotion.  Or should we set up a new
company?”  Sharp responded and instructed Veldhuis to use one of the preexisting nominee
companies.
124. On or about the same day, Veldhuis forwarded Sharp’s Encrypted
Communication to Kelln and asked: “[c]an u please send me on[e] of the 8 companies including
the address?”  Kelln, in turn, copied Gasarch on the Encrypted Communications chain and wrote:
“Wire [Gasarch]: pls provide [Veldhuis] a current 2015 holding co with address.”  Later that day,
Gasarch confirmed that she emailed the requested information to Veldhuis.
125. On or about April 7, 2015, Veldhuis communicated with Kaitz by Encrypted
Communications about issuing promotions concerning Stevia First/Vitality stock.
126. On or about May 6, 2015, Veldhuis and Sexton discussed, via Encrypted
Communications, arrangements for additional stock promotions to tout Stevia First/Vitality
stock.  Veldhuis wrote: “I been [sic] back and forth with [Kaitz] on it today.  He had trouble
getting ads approved on new network.  He has spent 2k this week so far and trying to get other
stuff approved today.  Was supposed to be done by Tuesday afternoon.”
127. On various dates in 2015 and 2016, during the promotional campaign that
Veldhuis coordinated through Kaitz, the Veldhuis Control Group sold, via Sharp Group-
administered nominee shareholders, in total, millions of shares of the March 2012 Stevia
First/Vitality Stock.

 
39
 
128. Dhillon received a cut of these proceeds, just as he had received distributions
from the proceeds of the defendants’ Stevia First/Vitality stock sales in at least 2012 and 2014.
On or about October 28, 2015, for example—consistent with Dhillon’s instruction that his cut of
the proceeds be transferred to third parties on his behalf to obscure the fact that they were
redounding to his benefit—the Veldhuis Control Group arranged for Wintercap SA to pay a third
party approximately $25,000 toward an expense incurred by Dhillon’s family.
129. Similarly, on or about June 21, 2016, Wintercap SA remitted $110,431.86 to a
loan servicing company in Colorado.  This payment, sent from a Sharp Group-administered
nominee entity, Morris Capital, was applied to pay a mortgage loan for Sexton’s benefit on a
property in California.
Round Four: 2016 – 2018 Illegal Vitality Stock Sales
130. On or about July 10, 2016, Stevia First changed its name to Vitality and executed
a 1-for-10 reverse split of its common stock.  The reverse split meant that shareholders were
required to exchange 10 shares for one share, which had the effect of reducing the total number
of outstanding shares of the company by a factor of 10.  This also had the effect of drastically
reducing the holdings of retail investors whom Defendants had prompted to purchase shares in
Stevia First through their previous promotional campaigns.
131. On various dates in 2016, the Veldhuis Control Group sent numerous wire
payments to Vitality, or to third parties on behalf of Vitality, totaling approximately $4.4 million.
In exchange, Vitality—with Dhillon operating as the chairman of its board of directors—issued
millions of shares (the “Vitality Stock”) to nominee entities that the Sharp Group once again
provided for use by the Veldhuis Control Group.

 
40
 
132. The Vitality Stock shares acquired by the Veldhuis Control Group from the
financing described in ¶ 131, above, were initially issued with restricted legends.  In order to
facilitate the liquidation of these shares, Kelln retained an attorney on behalf of each of the
nominee shareholder entities to prepare opinion letters that falsely represented that the nominee
shareholders were not affiliates of Vitality.
133. On various dates ranging between 2016 and 2018, the attorney retained by Kelln
on behalf of the Veldhuis Control Group issued opinion letters to Vitality’s transfer agent,
representing that none of the Sharp Group-administered nominee shareholders were affiliates of
Vitality.  Based on these false representations, Vitality’s transfer agent removed the restricted
legends from the Vitality Stock, thereby enabling the Veldhuis Control Group to sell the Vitality
Stock to the public.  In actuality, the Vitality Stock was controlled by affiliates of the company
and was legally restricted from resale.  Among other points of affiliation, the Veldhuis Control
Group was acting in concert with Dhillon, who was the chairman of Vitality’s board.
134. After Vitality’s transfer agent removed the restricted legend for one of the
nominee shareholders, Kelln advised Wintercap SA of an incoming deposit of 750,000 shares of
Vitality in the name of a Sharp Group-administered nominee shareholder called Hilton Capital.
135. At that time, Kelln noticed from reviewing Q records that Wintercap SA was
already holding Vitality shares (that had been previously deposited) in the name of Hilton
Capital.  The 750,000 additional shares would have brought the total shares held by that nominee
to more than 5% of Vitality’s issued shares.  As Kelln knew or recklessly disregarded, any
shareholder who was the beneficial owner of more than 5% of Vitality’s outstanding stock was
legally required to publicly disclose its holdings.  Such disclosures would have frustrated
Dhillon’s and the Veldhuis Control Group’s efforts to conceal their stock holdings and sales.

 
41
 
136. On or about February 28, 2017, Kelln instructed Wintercap SA to allocate all
Vitality Stock sales Wintercap was making that day to the Hilton account, thereby reducing the
number of Vitality shares that Hilton Capital was shown as holding.  This ruse prevented Hilton
Capital from showing share ownership in excess of 5%.  Specifically, Kelln wrote: “allocate all
VBIO [ticker symbol of Vitality] to the [Hilton Capital] account today.  We need to make room
for pending 750k.  Again 5% rule is biting me in the ass.”
137. The 750,000 shares were subsequently deposited with Wintercap SA.  Thereafter,
Veldhuis provided trading instructions to Wintercap SA to sell the Vitality Stock.
138. In or about December 2016, during the course of another Veldhuis Group-funded,
Kaitz-managed stock promotion touting Vitality’s stock, Wintercap SA’s principal asked
Veldhuis through an encrypted messaging application if the Vitality Control Group could
“switch selling to another outlet to let us [Wintercap SA] breath[e]” and slow the pace of selling.
Veldhuis responded that he could slow the pace “on the next batch, but that’s a week out.  In the
meantime, sell 15k VBIO @ 2.11.”  Wintercap SA’s principal suggested, in response, “[m]aybe
2 days on, 1 day off . . . .”  In response, Veldhuis suggested that he could move the stock held at
Wintercap SA to a competitor, Blacklight SA (“BL”).  This exchange followed:
Veldhuis to Wintercap
I will figure out how to move some elsewhere.  It pains me to give BL
business.
Wintercap to Veldhuis
Ok.  I don’t wish you to do that ;)
Veldhuis to Wintercap
Lol
Wintercap to Veldhuis
We can stay on point

139. In connection with their efforts to sell Vitality Stock in 2016 and later, the
Veldhuis Control Group again retained Kaitz to conduct a promotional campaign.  Between
October 2016 and March 2017, Veldhuis directed Wintercap SA to wire $530,000, which was

 
42
 
derived from financial accounts associated with four Sharp Group-administered nominee
shareholders, to Kaitz’s entity for the purpose of promoting Vitality.
***
140. Overall, the Sharp Group allocated Stevia First/Vitality stock sale proceeds as
follows during the period of time subject to this Complaint:
Defendant Approximate Amount (Millions)
Sexton                                                                   $5.5
Veldhuis                                                               $3.1
Friesen                                                                  $2.3
Taylor $4.3 (of which Taylor, in turn, promptly
forwarded approximately $2.6 million to
Dhillon, as noted in ¶ 82)
Kaitz                                                                     $1.4

141. Dhillon benefited by receiving millions of dollars from the proceeds of these
illegal stock sales, including through payments made by the Veldhuis Control Group and Taylor
to various third parties on Dhillon’s behalf.
The Veldhuis Control Group’s Omissions in Furtherance of the Scheme
142. Veldhuis, Sexton and Friesen acted as a group for purposes of acquiring, holding,
and ultimately disposing of Vitality shares, and consequently became subject to regulation as a
single person pursuant to Exchange Act Section 13(d)(3).  Veldhuis, Sexton and Friesen failed to
file any report on behalf of the group as required under Rule 13d-1(k)(2), even though they
collectively acquired, held, and were responsible for directing the disposition of, far more than
5% of Vitality’s outstanding stock through nominee entities that were under their group’s
control.
143. In failing to make required Schedule 13D/G filings, Veldhuis, Sexton, and Friesen
violated Section 13(d) and Rule 13d-1 thereunder.
  

 
43
 
Dhillon’s Failures to Disclose in Furtherance of the Scheme
144.   On August 17, 2016, Dhillon filed an untimely and inaccurately amended
Schedule 13D (specifically, a Schedule 13D/A) with the Commission.  Dhillon reported that he
was the beneficial owner of 1,530,585 shares (post stock split) consisting of:
a. 515,000 shares issued directly by Vitality in 2012.
b. 50,000 in stock options issued by Vitality in 2012.
c. 40,000 shares of common stock issued by Vitality in 2015.
d. 925,585 shares of common stock issued by Vitality in 2016.
145. In actuality, as of August 17, 2016, Dhillon was also a beneficial owner of a
significant number of shares of the stock held by the Veldhuis Control Group.  Dhillon did not
report, among other things, these shares in his Schedule 13D.
146. Dhillon also failed to file any Forms 4 reflecting the sales of Vitality stock that
had been sold on his behalf, directly or indirectly, by the Veldhuis Control Group.  For example,
on or about January 13, 2017, the Veldhuis Control Group caused Wintercap SA to sell 44,661
shares of Vitality, which sales generated proceeds of $105,551.21.  On or about January 27,
2017, the Veldhuis Control Group caused Wintercap SA to transfer $100,000 to pay an expense
incurred by Dhillon.  Dhillon failed to file a Form 4 reflecting either of these January 2017
Vitality stock sales, or any other sales by the Veldhuis Control Group in 2017 or 2018 from
which he benefitted.
Dhillon’s False and Misleading Testimony in Furtherance of the Scheme
147. On or about August 29, 2019, during the investigation leading to the filing of this
action, Dhillon provided sworn testimony to the Commission staff.  Seeking to conceal his illegal
conduct, Dhillon falsely denied being the beneficiary of any undisclosed Stevia First/Vitality

 
44
 
stock sales, and falsely denied knowing that the Veldhuis Control Group had sold Stevia
First/Vitality stock.
148. For example, during the August 2019 testimony, the Commission asked Dhillon if
he ever received the proceeds of any sales of Stevia First/Vitality stock.  Dhillon falsely replied,
“I have not.”  In actuality, the Veldhuis Control Group and Taylor had distributed Stevia
First/Vitality stock trading proceeds to Dhillon, directly and indirectly, through cash payments
and through payments to third parties on Dhillon’s behalf.
149. Similarly, during the August 2019 testimony, the Commission asked Dhillon if he
knew anyone who sold Stevia First/Vitality stock.  Dhillon falsely replied, “I’m not aware.”  In
actuality, Dhillon knew that the Veldhuis Control Group and Taylor had sold Stevia First/Vitality
stock, and had shared the resulting proceeds with him.
SHARP GROUP EXAMPLE TWO:
ILLEGAL ARCH STOCK SALES INVOLVING DHILLON, THE VELDHUIS
CONTROL GROUP, AND TAYLOR

150. Beginning in or about 2013, the Veldhuis Control Group schemed with Dhillon,
Taylor and Kaitz to sell illegally the stock of Arch.
151. In 2013, Dhillon arranged for a private company he controlled to merge (as a
reverse merger) into a publicly traded shell company controlled by the Veldhuis Control Group.
Following the reverse merger, which closed in or about June 2013, the surviving public company
was called Arch.
152. By April 2013, Dhillon had become an officer or director of Arch; and by June
2013, Dhillon had assumed the role of chairman of Arch’s board of directors.
153. Prior to the 2013 Arch reverse merger, Arch had issued shares to various S-1
Shareholders (hereinafter referred to as the “Arch S-1 Shareholders”) in 2012.  By early 2013,

 
45
 
following a stock split, the Arch S-1 Shareholders collectively held 20 million shares of Arch
stock (which traded under the ticker symbol “ARTH”).
154. Leading up to, and shortly after, the closing of the reverse merger, the Veldhuis
Control Group directed the transfer of 16,920,000 Arch shares, held in the names of several Arch
S-1 Shareholders, to eleven Sharp Group-administered nomine shareholders for the benefit of the
Veldhuis Control Group.
155. Kelln arranged, on behalf of the Veldhuis Control Group, to transfer an additional
2,310,000 shares, held in the names of several additional Arch S-1 Shareholders, to an entity
controlled by Wintercap SA called “Victory Capital” on behalf of the Veldhuis Control Group.
156. Combined, the Veldhuis Control Group held at least 19,230,000 purportedly
unrestricted shares of Arch, representing over 48% of Arch’s total issued and outstanding stock,
which constituted close to 100% of Arch’s unrestricted shares that were available for trading, at
or around the time of the reverse merger.
157. Shortly before the reverse merger closed, the Veldhuis Control Group controlled,
through a Sharp Group-administered nominee, an additional 20,000,000 shares that were marked
as restricted.  In anticipation of the reverse merger, the Veldhuis Control Group transferred these
shares to Dhillon (10,000,000) and a company controlled by the CEO of Arch (10,000,000).
Dhillon, in turn, transferred 2,750,000 shares to a domestic corporate entity (“Company A”), an
entity that was controlled by Dhillon’s associate, Person A.
158. The chart below illustrates the transfers described in ¶¶ 153 through 157.

 
46
 

159. The Veldhuis Control Group provided financing to Arch around the time of the
reverse merger.  Specifically, the Veldhuis Control Group funneled approximately $1.75 million
through an attorney’s escrow account, which was remitted to Arch in the form of equity
subscription agreements.  Dhillon, through his same Swiss-banking Ortivo account referenced in
¶ 82, also contributed $250,000 as part of this financing, but concealed this involvement from
Arch’s principals.
160. Following the reverse merger, the Veldhuis Control Group engaged Kaitz to

 
47
 
promote Arch and paid Kaitz approximately $1.2 million from June 2013 to August 2013 for this
promotion.
161. As Kaitz knew or recklessly disregarded, these payments were derived from
money held by Sharp Group-administered nominee shareholders on behalf of the Veldhuis
Control Group.  For example, on or about July 24, 2013, Kaitz sent the following Encrypted
Communication to Veldhuis: “Are you able to capture anything on arth?”  Kaitz was asking
Veldhuis, in substance, how much money, if any, the Veldhuis Control Group made from the
sale of Arch stock during the course of the stock promotion.
162. Some of the promotions managed by Kaitz falsely identified the promotions’
funding source.  For example, the landing page for an Arch promotion cited “Advantage Media
Corp” as the “paying party” of a $790,000 “total production budget.”  As Kaitz knew or
recklessly disregarded, Advantage Media was a front company used to disguise the identity of
the parties actually paying for the promotion, i.e. the Veldhuis Control Group.
163. On September 27, 2013, Kaitz asked Veldhuis in an Encrypted Communication
what to do if other stock promoters hired by Kaitz to distribute touts about Arch refused to
identify Advantage Media as the supposed paying party.  Kaitz wrote to Veldhuis: “Am trying to
have them put Advantage media, if they won’t then what?”  Later that day, Kaitz explained that
the other stock promoters said that “[t]hey will go if they get the invoice signed and sent back to
them via email from advantage.”  Veldhuis responded and directed Kaitz to send the invoice to
an email address created for the purpose of making it appear as if Advantage Media Corp. was an
actual third party: “send to [email protected].”
164. Sharp substantially assisted the Veldhuis Control Group’s use of Advantage
Media Corp. to disguise the Veldhuis Control Group’s Arch-related conduct.  For example, on or

 
48
 
about January 21, 2014, Sharp asked Veldhuis in an Encrypted Communication whether he
should continue to pay incorporation fees associated with Advantage Media Corp., and, if so,
whether he (Sharp) should use Arch stock sale proceeds to make such payments: “Do we pay the
2014 annual fees for advantage media corp (belize)?  Debit arth?”  Veldhuis responded: “Kill it.”
By that time, Advantage Media Corp. had served its purpose: the Veldhuis Control Group used it
as a front company to fund a stock promotional campaign touting Arch stock.
165. The chart below illustrates the success of the Veldhuis Control Group’s paid
promotion of Arch between June and September 2013:

166. During the period of the promotional campaign, the Veldhuis Control Group
surreptitiously sold millions of Arch shares into the market through nominee shareholders
administered by the Sharp Group.  Specifically, between June 11, 2013 and September 30, 2013,
the Veldhuis Control Group sold approximately 16.6 million shares of Arch stock through Sharp
Group-administered nominee shareholders, generating proceeds of at least $11.5 million.  The
 ‐
 1,000,000
 2,000,000
 3,000,000
 4,000,000
 5,000,000
 6,000,000
 7,000,000
 8,000,000
 9,000,000
 $0.30
 $0.50
 $0.70
 $0.90
 $1.10
 $1.30
 $1.50
Daily
 
Volume
Closing
 
Price
Arch Therapeutics, Inc. ‐Stock Price and Volume (May 2013 ‐Sept 2013)
VolumeClosing Price

 
49
 
Veldhuis Control Group sold another approximately 1.4 million shares generating proceeds of
approximately $574,000 through a nominee shareholder administered by Wintercap SA.
167. Throughout the period of these unregistered sales, the Veldhuis Control group
was an affiliate of Arch, by virtue of its control over a significant percentage of Arch’s stock
and/or because it was acting in concert with Dhillon, the chairman of the company.  Sharp,
Kelln, Veldhuis, Friesen, and Sexton failed to register their sales of Arch stock described herein
pursuant to Section 5 of the Securities Act.  In selling these shares, the Veldhuis Control Group,
through Sharp Group-administered nominee shareholders, surreptitiously sold unregistered
shares of stock, and schemed to defraud investors by concealing the fact that public company
affiliates were dumping stock into the markets.
168. The Veldhuis Control Group coordinated with Dhillon on the stock promotions.
For example, Sexton had one or more discussions with Dhillon where he discussed sharing the
promotional materials with Dhillon before they were published, and Sexton reported to Dhillon
the budget for promotions.  In addition, shortly before the merger closed, Friesen asked Sexton
and Veldhuis whether Dhillon would “have a set of news releases to begin issuing next week?”,
to which Sexton responded, “I asked for that yesterday.  He said he would deliver.”  Dhillon
played this role in order to benefit from the Veldhuis Control Group’s sale of stock, since, as the
Veldhuis Control Group and Dhillon knew, promotional campaigns tend to be more effective
when they coincide with news releases by the issuer whose stock is being promoted.
169. Dhillon directly participated in the Veldhuis Control Group’s sales of Arch, while
failing to register those sales pursuant to Section 5 of the Securities Act.  For example, on or
about August 13, 2013 in an Encrypted Communication, Sexton relayed a conversation he had
with Dhillon to Veldhuis: Sexton reported that he told Dhillon that the Veldhuis Control Group

 
50
 
“would be active in the market” until the first week of September and that they “wouldn’t sell
below $0.40 [per share].”  Sexton also relayed to Dhillon that the Veldhuis Control Group would
first distribute the proceeds of such sales as a repayment for the private placements they had
made (including Dhillon’s anonymous $250,000 investment) into Arch, but that a broader
distribution would take place in September.  Sexton noted Dhillon was “disappointed it wasn't
bigger success as we all are but I explained sometimes things out of control and we were
squeezing this out in short timeframe so it may have hurt us a bit in that we weren't able to stop
once we started.”  Sexton continued, “I said we worked well together and everyone did what they
said they would and that we would continue to look at his projects in future.”
170. On or about September 6, 2013, Veldhuis instructed Gasarch to wire $250,000
from the Arch proceeds to the same Dhillon owned Swiss-banking Ortivo account referenced in
¶¶ 82 and 159, thereby reimbursing Dhillon for his undocumented private placement investment.
Consistent with Sexton’s description above, the Veldhuis Control Group caused a further
distribution to be made from the Group’s illicit Arch stock sale proceeds for Dhillon’s benefit in
September 2013.
171. In particular, on or about September 26, 2013, Wintercap SA wired $200,000 to a
Canadian company controlled by Dhillon’s tax accountant, who, in turn, wired the very same
amount, on or about the same day, to a U.S.-based corporate account that Dhillon controlled.
This money was derived from the sale of Arch stock.
172. Taylor also schemed with the Veldhuis Control Group on the Arch deal and
received at least $600,000 of the proceeds generated by its Arch sales, while also failing to
register those sales pursuant to Section 5 of the Securities Act.  On or about August 20, 2013,
Sexton wrote to Veldhuis and instructed him to “send 600k from ARTH” to the same Taylor-

 
51
 
controlled Swiss bank account as that referenced in ¶ 82.  Two days later, at Veldhuis’s
direction, Gasarch wired the funds, to that same destination, from a Cayman Islands brokerage
account.  This $600,000 distribution derived from the illegal sales of Arch stock.
173. The Sharp Group allocated Arch stock sale proceeds to the Veldhuis Control
Group as follows during the period of time subject to this Complaint:
Veldhuis Control Group Member Approximate Amount (Millions)
Sexton                                                                   $1.7
Veldhuis                                                               $1.5
Friesen                                                                  $1.5

***
174. The table below reflects payments directed by the Veldhuis Control Group to
Dhillon and Taylor or entities with whom they were associated, sourced from the sale of Stevia
First/Vitality and Arch stock through Sharp Group-administered nominee shareholders from
2012 to 2018:
7

175. As described in ¶ 171, Dhillon was also the beneficiary of another $200,000 in
Arch stock sale proceeds in 2013, at the Veldhuis Control Group’s direction, but these funds
were sourced from a Wintercap SA-administered, rather than a Sharp Group-administered,
                                                            
7
 The table does not include payments made in cash to Dhillon or Taylor’s payments to Dhillon.
Ye arDhillonTaylorTotal
201233,890$            4,225,531$        4,259,421$
2013259,770            600,200            859,970
201410,000              124,200            134,200
201525,030              25,030
2016231,672            231,672
20172,157,330         2,157,330
2018300,500            300,500
Total3,018,192$     4,949,931$     7,968,123$

 
52
 
nominee shareholder.
***
176. During the period of April 2014 through March 2016, the table below reflects
various distributions of money, some of which were derived from Stevia First/Vitality and Arch
stock sale proceeds, directed by Taylor to third parties for the benefit of Dhillon or otherwise
associated with Dhillon:

***

177. On or about July 30, 2020, Dhillon appeared for further testimony before the
Commission in connection with the investigation leading to the filing of this action, and again
made false and misleading statements, including claims that (i) prior to 2014, his interactions

 
53
 
with Sexton had been limited to seeing him from a distance “in social circles ... [like] hockey
games”, “at charity events with his own tables [and] at restaurants entertaining people” and that
(ii) since 2014, his substantive interactions with Sexton have been limited to several discrete
topics that he characterized as innocent in nature.
***
178. In addition to their schemes to sell Arch and Vitality stock illegally that are
described above, Taylor and Dhillon also schemed to sell the stock of at least two other Dhillon-
chaired issuers:  Inovio and OncoSec.  Taylor’s and Dhillon’s Inovio scheme is described in the
following paragraph; the pair’s OncoSec scheme is described at ¶¶ 218 and 219.
179. At the time of Taylor’s and Dhillon’s Inovio scheme, Dhillon was the chairman of
Inovio’s Board of Directors.  Similarly to Taylor and Dhillon’s other schemes, Dhillon facilitated
the transfer of Inovio shares to a nominee company controlled by Taylor, who then directed the
unregistered sale of those shares from at least approximately August 23, 2013 to September 13,
2013.  Taylor’s sales generated at least $2.5 million in proceeds.  On various dates during
approximately November 2013 through January 2014, Taylor paid hundreds of thousands of
dollars to Dhillon or for Dhillon’s benefit.  Also, similarly to Taylor and Dhillon’s other
schemes, Dhillon failed to register the Inovio shares or report his beneficial ownership interest in
them or sale of them on either Schedule 13D or Form 4.
DHILLON’S SCHEME TO SELL ARCH STOCK ILLEGALLY THROUGH PERSON A

180. Dhillon illegally sold the stock of companies atop whose boards he sat through
different channels, apart from the Veldhuis Control Group and Taylor.  To that end, Dhillon
enlisted Person A to establish and manage a front company through which Dhillon
surreptitiously sold such stock, without Dhillon appearing associated with those stock sales in

 
54
 
any public record or filing.  Dhillon’s scheme to sell Arch stock illegally with Person A is
described in detail below.
181. Dhillon schemed to sell the stock of Arch fraudulently by, among other things,
concealing from securities intermediaries such as brokers that he was selling, through a nominee
shareholder, stock that was legally required to be registered, and concealing from Arch’s
shareholders that he—Arch’s highest-level insider—was selling Arch stock into the market.
182.  In or about April 2013, Dhillon became a director of Arch, and, by June of that
year, became chairman of its board.  Dhillon was an affiliate of Arch in that he had the power to
control the company through his role as its chairman.  As a public company affiliate, Dhillon was
legally required to register any sale of Arch stock unless Dhillon elected to comply with the safe
harbor provisions set forth in Commission Rule 144, which strictly limit the quantity of
securities an affiliate may sell to the public.  Dhillon testified, under oath, during the
Commission’s investigation that he understood these legal requirements at all times relevant to
this Complaint.
183. As a director of Arch, Dhillon was required to file public reports—including a
Form 4—with the Commission pursuant to Section 16(a) of the Exchange Act and Rule 16a-3
thereunder disclosing any change in his beneficial ownership of Arch stock, regardless of
amount.  Dhillon understood these legal requirements at all times relevant to this Complaint.
Dhillon failed to file any Forms 4 reflecting sales of Arch stock by the Veldhuis Control Group
(described above) or Person A from which he benefitted.
184. Dhillon was legally required to file a Schedule 13D with the Commission
pursuant to Section 13(d) of the Exchange Act and Rule 13d-1 thereunder to the extent he was
the beneficial owner of greater than five percent of Arch’s common stock.  Dhillon understood

 
55
 
these legal requirements at all times relevant to this Complaint.  Dhillon failed to file an accurate
Schedule 13D reflecting his beneficial ownership of Arch’s stock.
185. Shortly after Dhillon became the chairman of Arch’s board in April 2013, he
arranged for at least one alter ego corporate shareholder to hold Arch stock on his behalf.
Specifically, in or about June 2013, Dhillon arranged for the transfer of 2,750,000 Arch shares to
Company A, a corporate nominee that Dhillon directed Person A to form.  In order to disguise
Dhillon’s association with Company A, Person A, as directed by Dhillon, identified only Person
A as Company A’s director in its incorporation papers.  Company A was, in actuality, holding
Arch stock for Dhillon.
186. On or about April 6, 2016, Person A caused Company A to open an account with
a United States brokerage firm for the purpose of selling Arch stock.  Person A represented to the
United States brokerage firm that he (as the sole director of Company A), was not an “officer,
director, or more than a 10% shareholder of [Arch] or in any other way an ‘affiliate’ of [Arch].”
Person A’s representation was false and misleading in that Company A was actually holding, and
was created in order to sell, Arch stock on behalf of Dhillon, who was a director and affiliate of
Arch.  Dhillon knew, or recklessly disregarded, that Person A misled the United States brokerage
firm as part of their scheme to sell Arch stock surreptitiously.
187. The table below reflects Company A’s sales of Arch stock, all of which occurred
during a four-month period in 2016.  Dhillon failed to register these sales pursuant to Section 5
of the Securities Act:

 
56
 
188. At or about the same time that Company A sold Arch stock, Person A caused
Company A to transfer at least $850,000 of Arch stock sale proceeds to third parties identified by
Dhillon, his assistant, or both, all to benefit Dhillon.  These transfers included paying various
business and personal expenses Dhillon had incurred.
189. Examples of Arch proceeds-funded payments routed by Company A through
Dhillon’s assistant to a bank account controlled by Dhillon in the name of One World Ranches
LLC, as directed by Dhillon, are below.

190. Dhillon did not disclose the stock that Company A held on Dhillon’s behalf, or
Dhillon’s agreements with Person A concerning the holding and sale of those shares, on a
Schedule 13D, as legally required.  Nor did Dhillon disclose any of Company A’s Arch sales
executed on Dhillon’s behalf on any Form 4 filing with the Commission.
191. On or about July 8, 2013, Dhillon filed a Schedule 13D with the Commission
purportedly reflecting all of the Arch shares in which he held a beneficial interest.  This is the
only Schedule 13D Dhillon filed concerning Arch.  Dhillon reported that he was the beneficial
owner of 7,160,373 of Arch shares, consisting of:
a. 7,000,000 shares that he received in a private transaction in or about June
2013.

 
57
 
b.
160,373 shares of common stock in exchange for the cancellation of debt
Dhillon was owed by a private company that had merged with Arch. 
192. Dhillon’s July 8, 2013 Schedule 13D was materially misleading in that it failed to
reflect that Dhillon was also a beneficial owner of Arch stock held on Dhillon’s behalf by
Company A and additional Arch stock held on Dhillon’s behalf by the Veldhuis Control Group.
The Schedule 13D was also materially misleading in that it failed to disclose Dhillon’s
agreements with Person A and with the Veldhuis Control Group concerning the sale of Arch
shares, or his and their respective combined holdings in Arch securities.  Dhillon knowingly
failed to make any of these disclosures in his Schedule 13D in order to conceal that information
from investors and securities market intermediaries.
193. Dhillon also knowingly failed to file any Forms 4 reflecting the sales of Arch
stock that had been effected on his behalf, directly or indirectly, by Company A or the Veldhuis
Control Group.  For example, on various dates in April through June 2016, Company A sold
Arch shares in the market on Dhillon’s behalf.  Dhillon intentionally failed to file a Form 4
reflecting any of these 2016 Arch stock sales in order to conceal his conduct form Arch
investors.
194. On or about August 29, 2019, during the investigation leading to the filing of this
action, Dhillon provided sworn testimony to the Commission staff.
195. During that August 2019 testimony, the Commission asked Dhillon if he knew of
anyone who sold Arch stock prior to 2019.  Dhillon, seeking to conceal his illegal conduct from
the Commission, falsely replied, under oath: “I’m not aware.”  In actuality, and as Dhillon well
knew, Person A caused Company A to sell Arch shares on Dhillon’s behalf.  As described above,

 
58
 
and as Dhillon likewise well knew, the Veldhuis Control Group also sold Arch shares on
Dhillon’s behalf.

SHARP GROUP EXAMPLE THREE:
ILLEGAL ONCOSEC STOCK SALES INVOLVING DHILLON AND THE VELDHUIS
CONTROL GROUP

The Veldhuis Control Group’s Scheme to Sell OncoSec Stock Fraudulently

196. Prior to the Stevia First/Vitality and Arch fraudulent conduct described above, the
Veldhuis Control Group schemed with the Sharp Group and Dhillon to sell fraudulently the stock
of another issuer, OncoSec.  Further, Sharp, Kelln, Veldhuis, Friesen, Sexton, and Dhillon failed
to register the sales of OncoSec stock described herein pursuant to Section 5 of the Securities
Act.
197. In or about February 2011, the Veldhuis Control Group directed the transfer to
seven Sharp Group-administered nominee shareholders of 12,800,000 purportedly unrestricted
OncoSec shares sourced from 20 original individual investors.  At the time, OncoSec had
52,656,000 shares outstanding.  The Veldhuis Control Group, therefore, held over 24% of the
total common stock outstanding across the Sharp Group-provided nominee shareholders to
which the Veldhuis Control Group directed OncoSec shares, and was an affiliate of the issuer.
The Veldhuis Control Group knew that its 24% stake in OncoSec was legally restricted from
resale absent an effective registration statement.  The table below reflects the transfers
summarized in this paragraph.
8

                                                            
8
 Monterra Investments, Cliffside Partners, and Dartmore International are nominee shareholders utilized by the
Veldhuis Control Group.

 
59
 

198. Between approximately March 2011 and November 2011, the Veldhuis Control
Group sold, via various Sharp Group-administered nominee shareholders, approximately 2.2
million shares of OncoSec stock through offshore brokerage firms for proceeds of approximately
$3 million.
199. Later, the Veldhuis Control Group sold through the Sharp Group approximately
11 million more OncoSec shares between approximately February 2012 and August 2012 for
approximately $2.4 million more in illicit proceeds.
Dhillon’s Scheme to Sell OncoSec Fraudulently through Person A

200. Around the same time that the Veldhuis Control Group sold OncoSec securities,
Dhillon schemed to sell the stock of OncoSec fraudulently through Person A.  Dhillon concealed
from securities intermediaries, such as brokers, that he was selling, through a nominee
shareholder, stock that was legally required to be restricted, and concealed from OncoSec’s
investors that he was selling OncoSec stock into the market.

 
60
 
201. On or about March 10, 2011, Dhillon became the chairman of OncoSec’s board of
directors.
202. Dhillon was an affiliate of OncoSec because he was the chairman of its board.
Through that role, he had the power to control the company.  As a public company affiliate,
Dhillon was legally required to register any sale of OncoSec stock unless Dhillon elected to
comply with the safe harbor provisions set forth in Commission Rule 144.  Dhillon testified,
under oath, during the Commission’s investigation that he understood these legal requirements at
all times relevant to this Complaint.
203. As a director of OncoSec, Dhillon was required to file public reports—including a
Form 4—with the Commission pursuant to Section 16(a) of the Exchange Act and Rule 16a-3
thereunder disclosing any change in his beneficial ownership of OncoSec stock, regardless of
amount.  Dhillon understood these legal requirements at all times relevant to this Complaint.
204. Dhillon was legally required to file a Schedule 13D with the Commission
pursuant to Section 13(d) of the Exchange Act and Rule 13d-1 thereunder to the extent he was
the beneficial owner of greater than five percent of OncoSec’s common stock.  On or about
March 22, 2011, Dhillon received 9,910,496 restricted shares of OncoSec, which comprised
greater than 5% of the company’s outstanding stock.
205. Dhillon understood these legal requirements at all times relevant to this
Complaint.  Dhillon intentionally failed to file an accurate Schedule 13D reflecting his beneficial
ownership of OncoSec’s stock, his agreement with Person A concerning the sale of OncoSec
stock, or his and Person A’s combined holdings in OncoSec, despite being the beneficial owner
of greater than five percent of the company’s outstanding common stock.

 
61
 
206. Around the time that Dhillon became the chairman of OncoSec’s board in March
2011, he arranged for Person A to hold OncoSec stock on his behalf through a nominee
shareholder.
207. On or about March 2, 2011, Person A incorporated a corporate entity at Dhillon’s
direction, hereinafter referred to as Company B, to serve as Dhillon’s nominee shareholder.
Shortly thereafter, Dhillon facilitated Company B’s nominal acquisition of 2,354,880 OncoSec
shares.  At Dhillon’s direction, Person A identified himself as Company B’s sole director, in
order to conceal Dhillon’s association with Company B.
208. By December 2012, Person A opened a brokerage account in the name of
Company B.
209. On or about January 19, 2013, Person A represented to Company B’s brokerage
firm that Company B was never an “Officer, Director, Control Person, 10% owner or Affiliate of
the issuer being presented for deposit [i.e., OncoSec],” which was a confirmation required by the
brokerage firm when the OncoSec shares were deposited for resale.
210. Person A’s representations to the brokerage firm were false and misleading
because Company B was, in actuality, holding shares for Dhillon, who was a Director, Control
Person, and Affiliate of OncoSec.  Dhillon knew, or was reckless in not knowing, that Person A
would make these types of material misrepresentations to brokerage firms.  Indeed, Dhillon
directed Person A to establish Company B for precisely this purpose: to conceal the fact that
Dhillon was actually the beneficial owner of Company B’s OncoSec stock.
211. In or about January 2013, Person A caused Company B to deposit 2,354,880
shares of OncoSec into its brokerage account.  Person A, working in concert with Dhillon,
subsequently caused Company B to sell these shares on Dhillon’s behalf.

 
62
 
212. The table below reflects Company B’s sales of all 2,354,880 of its shares of
OncoSec stock, between 2013 and 2017.  Dhillon failed to register these stock sales pursuant to
Section 5 of the Securities Act.

213. Person A, acting through Company B, distributed the majority of the OncoSec
sale proceeds at Dhillon’s direction to third parties identified by Dhillon.  Dhillon directed the
transfers to third parties, instead of directly to his own bank accounts, to conceal that he was the
actual beneficiary of the stock sales.
214. The flow chart below reflects examples of Company B’s OncoSec proceeds-
funded transfers to Dhillon’s assistant for the benefit of Dhillon, as directed by Dhillon:

 
63
 
 
215. To conceal his conduct from investors, Dhillon never filed a Schedule 13D with
the SEC disclosing his agreement with Person A concerning the sale of OncoSec stock through
Company B, or his and Person A’s combined holdings in OncoSec stock, or any of the many
material changes to those combined holdings.
216. Dhillon knew that OncoSec’s public filings concealed from OncoSec’s
shareholders and securities market intermediaries the true extent of Dhillon’s beneficial
ownership position.  For example, OncoSec’s Form 10-K for the year ended July 31, 2011 only
reported Dhillon’s ownership of 9,910,496 shares, and failed to disclose Dhillon’s further
beneficial ownership of, at a minimum, the Company B shares.  As a further example,
OncoSec’s Form 10-K for the year ended July 31, 2017 failed to disclose the existence or extent
of Dhillon’s Form 4 filing delinquencies stemming from his failure to file any Forms 4
concerning his OncoSec share sales that year through Company B.
217. Indeed, to conceal his conduct from investors, Dhillon never filed any Forms 4
reporting Company B’s sales of OncoSec stock on his behalf, as legally required.
DHILLON’S SCHEME TO SELL ONCOSEC STOCK ILLEGALLY VIA TAYLOR

218. During the course of his scheme with Person A to sell illegally OncoSec stock,
described above, Dhillon also schemed with Taylor to sell illegally even more OncoSec stock.
At the time of this Dhillon-Taylor OncoSec scheme, Dhillon was the chairman of OncoSec’s

 
64
 
Board of Directors.  As part of this scheme, between at least April 2 and June 19, 2014, Taylor
sold at least 827,000 shares of OncoSec stock, through a Singapore-banking nominee
shareholder that he controlled, for proceeds totaling approximately $586,000.  Taylor failed to
register these stock sales pursuant to Section 5 of the Securities Act.
219. During that same period, and from the same account in which he had realized the
aforementioned approximately $586,000 in sale proceeds, Taylor, in turn, sent out two wires
totaling $155,000 for Dhillon’s benefit.  For examples, Taylor wired approximately $95,000 to
pay a creditor Dhillon owed, and $60,000 to a private company Dhillon owned.  And, as with his
other, similar schemes, Dhillon never disclosed—through any Form 4 or any other filing—his
OncoSec trading through Taylor.
***
ADDITIONAL SHARP GROUP AND VELDHUIS CONTROL GROUP DEALS
220. The Veldhuis Control Group utilized the Sharp Group’s services to disguise their
stock sales in deals beyond the Vitality, Arch, and OncoSec conduct detailed above.  In each
such case, the Sharp Group provided the infrastructure necessary to obfuscate the Veldhuis
Control Group’s ownership of a significant percentage of the public companies’ shares.  The
table below reflects a non-exhaustive list of stock sold by the Veldhuis Control Group using
Sharp Group-administered nominee shareholders to disguise their control.

 
65
 

221. The Veldhuis Control Group paid Kaitz to promote several of the issuers listed in
the table in ¶ 220, including (in addition to Stevia First/Vitality and Arch, both detailed above)
the stock of Echo Automotive, Liberty One Lithium Corp., Oryon Technologies, Inc., NewGen
Biopharma Corp., StartMonday Technology Corp., and BreathTech Biomedical, Inc.
222. In each instance, Kaitz knowingly or recklessly substantially assisted the Veldhuis
Control Group by materially omitting or materially misrepresenting the facts that the Veldhuis
Control Group (i) actually paid for the stock promotional campaign, and (ii) was actively trading,
and planned to trade, in the very opposite direction to which the promotions urged investors to
trade.
SHARP GROUP EXAMPLE: LUIS CARRILLO

223. As described in ¶ 43, above, the control group clients of the Sharp Group
generated over one billion dollars in stock sales through the Sharp Group between approximately
2010 and 2019.  One such client is a repeat offender, Luis Carrillo.
9
  Carrillo generated, in
concert with others, at least $75 million in illegal stock sale proceeds using the Sharp Group’s
encrypted communications and nominee shareholders as cover.  One such example is described
below.
 
                                                            
9
 See SEC v. Carrillo et al., 13-cv-1735-GBD (S.D.N.Y. March 2013).

 
66
 
224. On August 4, 2021, the Commission filed a Complaint against Luis Carrillo in
connection with his illegal sale of the stock of Garmatex Holdings, Ltd.  Carrillo, acting in
concert with others, amassed approximately 88% of Garmatex’s unrestricted shares that were
available for trading, and they used the Sharp Group, Wintercap SA, Blacklight SA, and a
separate broker to execute the scheme.
225. In particular, Kelln, at Sharp’s direction, deposited three blocks of Garmatex
stock—each consisting of 1,750,000 Garmatex shares, or just under five percent of Garmatex’s
total outstanding stock—with Wintercap SA in the name of three Sharp Group nominee
shareholders.  As Sharp and Kelln knew, or recklessly disregarded, brokerage firms typically
inquire about whether a shareholder owns more than five percent of a public company’s stock
because holding more than five percent may trigger additional questions about whether the sales
are part of a distribution that must be registered pursuant to Section 5 of the Securities Act.
226. Sharp and Kelln arranged for these deposits in the names of separate Sharp Group
nominee shareholders well knowing that Carrillo and his team were actually the beneficial
owners of the shares. For example, on or about March 9, 2017, Kelln replied to an Encrypted
Communication from Wintercap SA’s principal about the status of selling Garmatex stock:
“Changing the [transfer agent] first . . . [Carrillo is] up my butt to get grmx [the ticker of
Garmatex] all in.”
227. The Sharp Group’s provision of these nominee shareholders enabled Carrillo,
acting in concert with others, to conceal from brokerage firms that they actually controlled
greater than five percent of the company’s outstanding shares.
228. Overall, during approximately March and April 2017, Kelln coordinated with
Carrillo, acting in concert with others, to transfer a total of 12,233,337 shares of Garmatex

 
67
 
nominally held by six different Sharp Group-administered nominee shareholders to Wintercap
SA, Blacklight SA, and a third party.  Collectively, these positions accounted for approximately
88% of Garmatex’s purportedly unrestricted shares that were available for trading, and
approximately 34% of Garmatex’s total issued and outstanding stock.  Carrillo, therefore, was an
affiliate of Garmatex.
229. The chart below summarizes the Garmatex share transfers described above:

230. Carrillo, acting in concert with others, coordinated the trading of Garmatex stock
at Wintercap SA, Blacklight SA and a separate broker during a stock promotional campaign,
generating proceeds as a result of these unregistered sales in excess of $7 million.
TOLLING AGREEMENTS

 
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231. Between January and June 2020, Dhillon entered into two separate tolling
agreements with the Commission.  Each tolling agreement specifies a period of time (a “tolling
period”) in which “the running of any statute of limitations applicable to any action or
proceeding against Dhillon authorized, instituted, or brought by ... the Commission... arising out
of the [Commission’s investigation of Dhillon’s conduct], including any sanctions or relief that
may be imposed therein, is tolled and suspended . . . .”  Each tolling agreement further provides
that Dhillon “shall not include the tolling period in the calculation of the running of any statute
of limitations or for any other time-related defense applicable to any proceeding, including any
sanctions or relief that may be imposed therein, in asserting or relying upon any such time-
related defenses.”  Collectively, these agreements tolled the running of any limitations period or
any other time-related defenses available to Dhillon for a period of approximately seven months
and three days.
FIRST CLAIM FOR RELIEF
FRAUD IN THE OFFER OR SALE OF SECURITIES
(Violations of Sections 17(a)(1) and (3) of the Securities Act by Sharp, Kelln, Veldhuis,
Sexton, Friesen, Dhillon, and Taylor)

232. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if
fully set forth herein.
233. During the Relevant Period, the stock of Vitality, Arch, and OncoSec was each a
security under Section 2(a)(1) of the Securities Act [15 U.S.C. §77b(a)(1)], and a penny stock.
234. By reason of the conduct described above, defendants Sharp, Kelln, Veldhuis,
Sexton, Friesen, Dhillon, and Taylor, in connection with the offer or sale of securities, by the use
of the means or instrumentalities of interstate commerce or of the mails, directly or indirectly,
acting intentionally, knowingly, recklessly or negligently (i) employed devices, schemes, or
artifices to defraud; and (ii) engaged in transactions, practices, or courses of business which

 
69
 
operated or would operate as a fraud or deceit upon any persons, including purchasers or sellers
of the securities.
235. By reason of the conduct described above, defendants Sharp, Kelln, Veldhuis,
Sexton, Friesen, Dhillon, and Taylor violated Securities Act Sections 17(a)(1) and (3) [15 U.S.C.
§77q(a)(1) and (3)] and will continue to violate those sections unless enjoined.
SECOND CLAIM FOR RELIEF
FRAUD IN CONNECTION WITH THE PURCHASE OR SALE OF SECURITIES
(Violations of Section 10(b) of the Exchange Act and Rules 10b-5(a) and (c) by Sharp,
Kelln, Veldhuis, Sexton, Friesen, Dhillon, and Taylor)

236. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if
fully set forth herein.
237. During the Relevant Period, the stock of Vitality, Arch, and OncoSec was each a
security under Section 2(a)(1) of the Securities Act [15 U.S.C. §77b(a)(1)], and a penny stock.
238. By reason of the conduct described above, defendants Sharp, Kelln, Veldhuis,
Sexton, Friesen, Dhillon, and Taylor, directly or indirectly, in connection with the purchase or
sale of securities, by the use of the means or instrumentalities of interstate commerce or of the
mails, or of any facility of any national securities exchange, intentionally, knowingly or
recklessly, (i) employed devices, schemes, or artifices to defraud; and (ii) engaged in acts,
practices, or courses of business which operated or would operate as a fraud or deceit upon any
persons, including purchasers or sellers of the securities.
239. By reason of the conduct described above, defendants Sharp, Kelln, Veldhuis,
Sexton, Friesen, Dhillon, and Taylor violated Exchange Act Section 10(b) [15 U.S.C. §78j(b)]
and Rules 10b-5(a) and (c) [17 C.F.R. §240.10b-5(a) and (c)] thereunder.

 
70
 
THIRD CLAIM FOR RELIEF
UNREGISTERED OFFERINGS OF SECURITIES
(Violations of Sections 5(a) and 5(c) of the Securities Act by Sharp, Kelln, Veldhuis,
Friesen, Sexton, and Dhillon)

240. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if
fully set forth herein.
241. During the Relevant Period, the stock of Vitality, Arch, and OncoSec was each a
security under Section 2(a)(1) of the Securities Act [15 U.S.C. §77b(a)(1)], and a penny stock.
242. By reason of the conduct described above, defendants Sharp, Kelln, Veldhuis,
Friesen, Sexton, and Dhillon, directly or indirectly:  (a) made use of the means or instruments of
transportation or communication in interstate commerce or of the mails to sell, through the use or
medium of a prospectus or otherwise, securities as to which no registration statement has been in
effect and for which no exemption from registration has been available; and/or (b) made use of
the means or instruments of transportation or communication in interstate commerce or of the
mails to offer to sell, through the use or medium of a prospectus or otherwise, securities as to
which no registration statement has been filed and for which no exemption from registration has
been available.
243. As a result, Sharp, Kelln, Veldhuis, Friesen, Sexton, and Dhillon violated
Sections 5(a) and (c) of the Securities Act [15 U.S.C. §§77e(a), (c)].
FOURTH CLAIM FOR RELIEF
FAILURE TO REPORT OVER 5% BENEFICIAL OWNERSHIP
(Violations of Section 13(d) of the Exchange Act and Rule 13d-1 Thereunder by Veldhuis,
Sexton, and Friesen)

244. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if
fully set forth herein.

 
71
 
245. During the Relevant Period, the stock of Vitality was a security under Section
3(a)(1) of the Exchange Act [15 U.S.C. §78c(a)(10)], and a penny stock.
246. During the Relevant Period, Vitality had equity securities that were registered
pursuant to Section 12 of the Exchange Act [15 U.S.C. §78l].
247. By reason of the conduct described above, defendants Veldhuis, Sexton, and
Friesen, after acquiring directly or indirectly beneficial ownership of more than 5 percent of a
class of Vitality equity securities, failed to file a statement with the Commission containing the
information required by Schedule 13D [17 C.F.R. §240.13d-101] within ten days after they
acquired such shares, or at all.
248. As a result, defendants Veldhuis, Sexton, and Friesen violated Section 13(d) of
the Exchange Act and Rule 13d-1 thereunder [15 U.S.C. §78m(d); 17 C.F.R. §240.13d-1].
FIFTH CLAIM FOR RELIEF
FAILURE TO REPORT OVER 5% BENEFICIAL OWNERSHIP
(Violation of Section 13(d) of the Exchange Act and Rule 13d-2 Thereunder by Dhillon)

249. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if
fully set forth herein.
250. During the Relevant Period, the stock of Vitality was a security under Section
3(a)(1) of the Exchange Act [15 U.S.C. §78c(a)(10)], and a penny stock.
251. During the Relevant Period, Vitality had equity securities that were registered
pursuant to Section 12 of the Exchange Act [15 U.S.C. §78l].
252. By reason of the conduct described above, defendant Dhillon, after acquiring
directly or indirectly beneficial ownership of more than 5 percent of a class of Vitality equity
securities and filing a Schedule 13D, acquired beneficial ownership of 1 percent or more of that

 
72
 
class of equity securities and failed to file with the Commission a timely and accurate
amendment disclosing this material change.
253. As a result, defendant Dhillon violated Section 13(d) of the Exchange Act and
Rule 13d-2 thereunder [15 U.S.C. §78m(d); 17 C.F.R. §240.13d-2].
SIXTH CLAIM FOR RELIEF
FAILURE TO FILE
(Violation of Section 16(a) of the Exchange Act and Rule 16a-3 Thereunder by Dhillon)

254. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if
fully set forth herein.
255. During the Relevant Period, the stock of Arch and OncoSec was each a security
under Section 3(a)(1) of the Exchange Act [15 U.S.C. §78c(a)(10)], and a penny stock.
256. During the Relevant Period, Arch and OncoSec had equity securities that were
registered pursuant to Section 12 of the Exchange Act [15 U.S.C. §78l].
257. Defendant Dhillon violated Section 16(a) of the Exchange Act [15 U.S.C. §
78p(a)], and Rule 16a-3 thereunder [17 C.F.R. § 240.16(a)], in that as a director of Arch and
OncoSec and having acquired more than 10% of a registered class of Arch’s and OncoSec’s
equity securities, Dhillon failed to file reports of ownership and changes of ownership with the
Commission as required.
SEVENTH CLAIM FOR RELIEF
AIDING AND ABETTING
(Violations of Section 15(b) of the Securities Act by Taylor)

258. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if
fully set forth herein.
259. By reason of the conduct described above, Dhillon, directly or indirectly:
(a) made use of the means or instruments of transportation or communication in interstate

 
73
 
commerce or of the mails to sell, through the use or medium of a prospectus or otherwise,
securities as to which no registration statement has been in effect and for which no exemption
from registration has been available; and/or (b) made use of the means or instruments of
transportation or communication in interstate commerce or of the mails to offer to sell, through
the use or medium of a prospectus or otherwise, securities, including, but not limited to, the
securities of Vitality, as to which no registration statement has been filed and for which no
exemption from registration has been available.
260. Taylor knowingly or recklessly provided substantial assistance to Dhillon in his
violation of Sections 5(a) and 5(c) of the Securities Act.
261. As a result, Taylor violated Section 15(b) the Securities Act [15 U.S.C. §§
77o(b)].
EIGHTH CLAIM FOR RELIEF
AIDING AND ABETTING
(Violations of Section 15(b) of the Securities Act by Sharp and Kelln)

262. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if
fully set forth herein.
263. By reason of the conduct described above, Veldhuis, Sexton, Friesen, Carrillo,
and other Sharp Group clients, directly or indirectly, in the offer or sale of securities, by the use
of the means or instrumentalities of interstate commerce or of the mails, or of any facility of any
national securities exchange, intentionally, knowingly or recklessly, (i) employed devices,
schemes, or artifices to defraud; and (ii) engaged in transactions, practices, or courses of business
which operated or would operate as a fraud or deceit upon any persons, including purchasers or
sellers of the securities.

 
74
 
264. By reason of the conduct described above, Veldhuis, Sexton, Friesen, Carrillo,
and other Sharp Group clients, directly or indirectly:  (a) made use of the means or instruments
of transportation or communication in interstate commerce or of the mails to sell, through the use
or medium of a prospectus or otherwise, securities as to which no registration statement has been
in effect and for which no exemption from registration has been available; and/or (b) made use of
the means or instruments of transportation or communication in interstate commerce or of the
mails to offer to sell, through the use or medium of a prospectus or otherwise, securities,
including, but not limited to, the securities of Vitality, Arch, OncoSec, and Garmatex, as to
which no registration statement has been filed and for which no exemption from registration has
been available.
265. Sharp and Kelln knowingly or recklessly provided substantial assistance to
Veldhuis, Sexton, Friesen, Carrillo, and other Sharp Group clients in their violations of Sections
5(a), 5(c), and 17(a)(1) and (3) of the Securities Act.
266. As a result, Sharp and Kelln each violated Section 15(b) of the Securities Act
[15 U.S.C. §§ 77o(b)].
NINTH CLAIM FOR RELIEF
AIDING AND ABETTING
(Violations of Section 20(e) of the Exchange Act by Sharp and Kelln)

267. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if
fully set forth herein.
268. By reason of the conduct described above, Veldhuis, Sexton, Friesen, Carrillo,
and other Sharp Group clients, directly or indirectly, in connection with the purchase or sale of
securities, by the use of the means or instrumentalities of interstate commerce or of the mails, or
of any facility of any national securities exchange, intentionally, knowingly or recklessly, (i)

 
75
 
employed devices, schemes, or artifices to defraud; and (ii) engaged in acts, practices, or courses
of business which operated or would operate as a fraud or deceit upon any persons, including
purchasers or sellers of the securities.
269. Sharp and Kelln knowingly or recklessly provided substantial assistance to
Veldhuis, Sexton, Friesen, Carrillo, and other Sharp Group clients in their violations of Section
10(b) of the Exchange Act and Rules 10b-5(a) and (c) thereunder.
270. As a result, Sharp and Kelln each violated Section 20(e) the Exchange Act
[15 U.S.C. § 78t(e)].
TENTH CLAIM FOR RELIEF
FRAUD IN THE OFFER OR SALE OF SECURITIES
(Violations of Section 17(a)(3) of the Securities Act by Gasarch)

271. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if
fully set forth herein.
272. During the Relevant Period, the stock of Vitality, Arch, OncoSec, and Garmatex
was each a security under Section 2(a)(1) of the Securities Act [15 U.S.C. §77b(a)(1)].
273. By reason of the conduct described above, defendant Gasarch, in connection with
the offer or sale of securities, by the use of the means or instrumentalities of interstate commerce
or of the mails, directly or indirectly, acting intentionally, knowingly, recklessly or negligently
engaged in transactions, practices, or courses of business which operated or would operate as a
fraud or deceit upon any persons, including purchasers or sellers of the securities.
274. By reason of the conduct described above, defendant Gasarch violated Securities
Act Section 17(a)(3) [15 U.S.C. §77q(a)(3)].

 
76
 
ELEVENTH CLAIM FOR RELIEF
FRAUD IN THE OFFER OR SALE OF SECURITIES
(Violations of Section 17(a)(3) of the Securities Act by Kaitz)

275. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if
fully set forth herein.
276. During the Relevant Period, the stock of Vitality and Arch was each a security
under Section 2(a)(1) of the Securities Act [15 U.S.C. §77b(a)(1)].
277. By reason of the conduct described above, defendant Kaitz, in connection with the
offer or sale of securities, by the use of the means or instrumentalities of interstate commerce or
of the mails, directly or indirectly, acting intentionally, knowingly, recklessly or negligently
engaged in transactions, practices, or courses of business which operated or would operate as a
fraud or deceit upon any persons, including purchasers or sellers of the securities.
278. By reason of the conduct described above, defendant Kaitz violated Securities Act
Section 17(a)(3) [15 U.S.C. §77q(a)(3)].
TWELFTH CLAIM FOR RELIEF
AIDING AND ABETTING
(Violations of Section 15(b) of the Securities Act by Gasarch)

279. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if
fully set forth herein.
280. By reason of the conduct described above, Sharp, Kelln, Veldhuis, Sexton,
Friesen, Carrillo, and other Sharp Group clients, directly or indirectly, in the offer or sale of
securities, by the use of the means or instrumentalities of interstate commerce or of the mails, or
of any facility of any national securities exchange, intentionally, knowingly or recklessly,
(i) employed devices, schemes, or artifices to defraud; and (ii) engaged in transactions, practices,

 
77
 
or courses of business which operated or would operate as a fraud or deceit upon any persons,
including purchasers or sellers of the securities.
281. Gasarch knowingly or recklessly provided substantial assistance to Sharp, Kelln,
Veldhuis, Sexton, Friesen, Carrillo, and other Sharp Group clients in their violations of Sections
17(a)(1) and 17(a)(3) of the Securities Act.
282. As a result, Gasarch violated Section 15(b) the Securities Act [15 U.S.C. §§
77o(b)].
THIRTEENTH CLAIM FOR RELIEF
AIDING AND ABETTING
(Violations of Section 15(b) of the Securities Act by Kaitz)

283. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if
fully set forth herein.
284. By reason of the conduct described above, Veldhuis, Sexton, and Friesen, directly
or indirectly, in the offer or sale of securities, by the use of the means or instrumentalities of
interstate commerce or of the mails, or of any facility of any national securities exchange,
intentionally, knowingly or recklessly, (i) employed devices, schemes, or artifices to defraud;
and (ii) engaged in transactions, practices, or courses of business which operated or would
operate as a fraud or deceit upon any persons, including purchasers or sellers of the securities.
285. Kaitz knowingly or recklessly provided substantial assistance to Veldhuis,
Sexton, and Friesen in their violations of Sections 17(a)(1) and 17(a)(3) of the Securities Act.
286. As a result, Kaitz violated Section 15(b) the Securities Act [15 U.S.C. §§ 77o(b)].

 
78
 
FOURTEENTH CLAIM FOR RELIEF
AIDING AND ABETTING
(Violations of Section 20(e) of the Exchange Act by Gasarch)

287. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if
fully set forth herein.
288. By reason of the conduct described above, Sharp, Kelln, Veldhuis, Sexton,
Friesen,  Carrillo, and other Sharp Group clients directly or indirectly, in connection with the
purchase or sale of securities, by the use of the means or instrumentalities of interstate commerce
or of the mails, or of any facility of any national securities exchange, intentionally, knowingly or
recklessly, (i) employed devices, schemes, or artifices to defraud; and (ii) engaged in acts,
practices, or courses of business which operated or would operate as a fraud or deceit upon any
persons, including purchasers or sellers of the securities.
289. Gasarch knowingly or recklessly provided substantial assistance to Sharp, Kelln,
Veldhuis, Sexton, Friesen, Carrillo, and other Sharp Group clients in their violations of Section
10(b) of the Exchange Act and Rules 10b-5(a) and (c) thereunder.
290. As a result, Gasarch violated Section 20(e) the Exchange Act [15 U.S.C. § 78t(e)].
FIFTEENTH CLAIM FOR RELIEF
AIDING AND ABETTING
(Violations of Section 20(e) of the Exchange Act by Kaitz)

291. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if
fully set forth herein.
292. By reason of the conduct described above Veldhuis, Sexton, and Friesen directly
or indirectly, in connection with the purchase or sale of securities, by the use of the means or
instrumentalities of interstate commerce or of the mails, or of any facility of any national
securities exchange, intentionally, knowingly or recklessly, (i) employed devices, schemes, or

 
79
 
artifices to defraud; and (ii) engaged in acts, practices, or courses of business which operated or
would operate as a fraud or deceit upon any persons, including purchasers or sellers of the
securities.
293. Kaitz knowingly or recklessly provided substantial assistance to Veldhuis,
Sexton, and Friesen in their violations of Section 10(b) of the Exchange Act and Rules 10b-5(a)
and (c) thereunder.
294. As a result, Kaitz violated Section 20(e) the Exchange Act [15 U.S.C. § 78t(e)].
PRAYER FOR RELIEF
WHEREFORE, the Commission respectfully requests that this Court:
A. Enter a permanent injunction restraining the defendants Sharp, Kelln, Veldhuis,
Sexton, Friesen, Dhillon, Gasarch, Kaitz and Taylor, their agents, servants, employees and
attorneys, and those persons in active concert or participation with them who receive actual
notice of the injunction by personal service or otherwise, from violating Sections 17(a) of the
Securities Act [15 U.S.C. §§77q(a)], and Section 10(b) of the Exchange Act [15 U.S.C. §§78j(b)]
and Rule 10b-5 thereunder [17 C.F.R. §240.10b-5].
B. Enter a permanent injunction restraining defendants Sharp, Kelln, Veldhuis,
Sexton, Friesen, Taylor and Dhillon, their agents, servants, employees and attorneys, and those
persons in active concert or participation with them who receive actual notice of the injunction
by personal service or otherwise, from violating Sections 5(a) and 5(c) of the Securities Act [15
U.S.C. §§77e(a), (c)].
C. Enter a permanent injunction restraining defendants Veldhuis, Sexton, and
Friesen, their agents, servants, employees and attorneys, and those persons in active concert or
participation with them who receive actual notice of the injunction by personal service or

 
80
 
otherwise, from violating Section 13(d) of the Exchange Act [15 U.S.C. §78m(d)] and Rule 13d-
1 thereunder.
D. Enter a permanent injunction restraining defendant Dhillon, his agents, servants,
employees and attorneys, and those persons in active concert or participation with him who
receive actual notice of the injunction by personal service or otherwise, from violating Section
13(d) of the Exchange Act [15 U.S.C. §78m(d)] and Rule 13d-2 thereunder.
E. Enter a permanent injunction restraining defendant Dhillon, his agents, servants,
employees and attorneys, and those persons in active concert or participation with him who
receive actual notice of the injunction by personal service or otherwise, from violating Section
16(a) of the Exchange Act [15 U.S.C. §78p(a)] and Rule 16a-3 thereunder.
 F.  Order the defendants to disgorge, with prejudgment interest, all ill-gotten gains
obtained by reason of the unlawful conduct alleged in this Complaint pursuant to Section
21(d)(7) of the Exchange Act [15 U.S.C. §78u(d)(7)];
G. Order the defendants to pay civil monetary penalties pursuant to Section 20(d) of
the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) of the Exchange Act [15 U.S.C.
§ 78u(d)(3)];
H. Enter an order barring the defendants from participating in any offering of a
penny stock, pursuant to Section 20(g) of the Securities Act [15 U.S.C. § 77t(g)] and 21(d) of the
Exchange Act [15 U.S.C. § 78u(d)];
I. Enter an order barring the defendants from directly or indirectly, including, but
not limited to, through an entity owned or controlled by any of them, participating in the
issuance, purchase, offer, or sale of any security; provided, however, that such injunction shall

 
81
 
not prevent defendants from purchasing or selling securities listed on a national securities
exchange for their own personal account;
J. Enter an order barring defendant Dhillon from serving as an officer or director of
a public company pursuant to Section 20(e) of the Securities Act [15 U.S.C. § 77t(e)] and
21(d)(2) of the Exchange Act [15 U.S.C. § 78u(d)(2)];
K. Retain jurisdiction over this action to implement and carry out the terms of all
orders and decrees that may be entered; and
L. Grant such other and further relief as this Court may deem just and proper.
JURY DEMAND
The Commission demands a jury in this matter for all claims so triable.

DATED this 4th day of August, 2021.

                                                                        Respectfully            submitted,
/s/ Eric A. Forni
Eric A. Forni (Mass Bar No. 669685)
Kathleen B. Shields (Mass Bar No. 637438)
Katherine Bromberg (New York Bar No. 4154555)
J. Lee Buck II (DC Bar No. 421878)
      Edward B. Gerard (CA Bar No. 248053)
Amy Gwiazda (Mass Bar No. 663494)
Martin Healey (Mass Bar No. 227550)
      SECURITIES AND EXCHANGE COMMISSION
Boston Regional Office
33 Arch St., 24
th
 Floor
Boston, MA 02110
Phone: (617) 573-8904 (Shields direct),
(617) 573-8827 (Forni direct)
Fax: (617) 573-4590 (fax)
[email protected] (Shields email)
[email protected] (Forni email)

UNITED STATES DISTRICT COURT 
DISTRICT OF MASSACHUSETTS 

 

 
SECURITIES AND EXCHANGE 
COMMISSION, 
    Plaintiff, 
 v. 
 
FREDERICK L. SHARP, ZHIYING 
YVONNE GASARCH, COURTNEY 
KELLN, MIKE K. VELDHUIS, PAUL 
SEXTON, JACKSON T. FRIESEN, 
WILLIAM T. KAITZ, AVTAR S. 
DHILLON, and GRAHAM R. TAYLOR, 
 
    Defendants. 
 

 
 

Civil Action No. 21-CV-____ 
(___) 

 
JURY TRIAL DEMANDED 

 
 

 
COMPLAINT 

 Plaintiff, Securities and Exchange Commission (the “Commission”), alleges the 

following against defendants Frederick L. Sharp (“Sharp”), Zhiying Yvonne Gasarch 

(“Gasarch”), Courtney Kelln (“Kelln”), Mike K. Veldhuis (“Veldhuis”), Paul Sexton (“Sexton”), 

Jackson T. Friesen (“Friesen”), William T. Kaitz (“Kaitz”), Avtar S. Dhillon (“Dhillon”), and 

Graham R. Taylor (“Taylor”) (collectively, the “Defendants”).   

SUMMARY 

1. This case concerns a sophisticated, multiyear, multi-national attack on the United 

States financial markets and retail United States investors by foreign and domestic actors.  These 

actors schemed to sell fraudulently hundreds of millions of dollars in stocks in the United States 

markets.  

2. In exchange for lucrative fees, a group headed by defendant Sharp provided 

services to various groups of public company control persons to help those control persons dump 

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United States-quoted stocks—typically penny stocks—on retail investors.  These services 

included providing networks of offshore shell companies to conceal stock ownership, arranging 

stock transfers and money transmittals, and providing encrypted accounting and communications 

systems.   

3. Other defendants named in this Complaint were control persons who dumped 

their shares, a complicit public company chairman, and a promoter who touted the stocks to 

retail investors.   

4. The Defendants’ fraudulent conduct deprived investors of the full and fair 

disclosure mandated by the federal securities laws.   

Sharp’s, Kelln’s and Gasarch’s Participation in the Fraudulent Scheme 

5. Beginning in or before 2010 and continuing through the present, Sharp, Gasarch, 

and Kelln (the “Sharp Group”) were in the business of facilitating illegal stock sales in the public 

securities markets.  The Sharp Group provided a variety of services to help corporate control 

persons conceal their identities when selling the stock of penny stock companies they controlled.  

By disguising their identities and their controlling positions, the Sharp Group’s clients 

fraudulently concealed the fact that public company control persons were selling large blocks of 

stock to investors.   

6. The Sharp Group deliberately concealed the identities of its clients through the  

array of services it offered, including forming and providing offshore nominee companies that 

could hold shares for undisclosed control persons; providing and administering an encrypted 

communication network; purchasing, configuring and delivering devices that the Sharp Group 

referred to as “xPhones,” which were designed to be used only for communications on the Sharp 

Group’s encrypted communications network; and arranging for clients to deposit stock in 

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offshore trading platforms, including Wintercap SA1 and Blacklight SA,2 both Swiss-based, to 

obfuscate the control persons’ association with their public company stock.  The Sharp Group 

also provided various additional services to its clients in furtherance of the fraudulent scheme 

such as: administering a proprietary accounting system that tracked clients’ total stock holdings 

and sales across various nominee shareholders and trading platforms; paying out the proceeds of 

illegal stock sales at clients’ direction to accounts around the world; arranging to route such 

payments by circuitous methods designed to conceal the source of funds; and fabricating 

documents, such as invoices, to conceal the nature and source of the payments.   

Veldhuis’, Sexton’s, and Friesen’s Participation in the Fraudulent Scheme 

7. Working together, Veldhuis, Sexton, and Friesen (hereinafter referred to as the 

“Veldhuis Control Group”) were one group of control persons (hereinafter referred to as a 

“control group”) that teamed with the Sharp Group to run lucrative, fraudulent schemes to sell 

stock surreptitiously in the public markets.   

8. At various times, the Veldhuis Control Group collaborated with defendants 

Dhillon, Taylor, and Kaitz.  In particular, the Veldhuis Control Group sold illegally the stock of 

Stevia First Corp. (“Stevia First”), Stevia First’s successor company Vitality Biopharma, Inc. 

(“Vitality”), Arch Therapeutics, Inc. (“Arch”), and OncoSec Medical Incorporated (“OncoSec”) 

in concert with Dhillon.  The Veldhuis Control Group and Dhillon also sold illegally the stock of 

Vitality and Arch in concert with Kaitz and Taylor.   

                                                            
1 The Commission charged Wintercap SA and its principal, Roger Knox, on October 2, 2018, with violating the 
antifraud provisions of the Securities Act of 1933 (“Securities Act”) and Securities Exchange Act of 1934 
(“Exchange Act”) as a result of engaging in a multiyear scheme that generated more than $165 million from the 
illegal sale of stock of at least 50 publicly traded companies.   

2 The Commission charged Blacklight SA and its principals, Anthony Killarney and Kenneth Ciapala, on January 2, 
2020 with violating the Securities Act and Exchange Act antifraud provisions as a result of engaging in a multiyear 
scheme that generated more than $35 million from the illegal sale of stock of at least 45 publicly traded companies.   

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Dhillon’s Role in the Scheme 

9. Dhillon served as the chairman of the board of directors of Stevia First, Vitality, 

Arch, and OncoSec.  Dhillon’s status as a high-level corporate insider enabled him to obtain 

and/or direct the issuance of millions of shares of each company’s stock to his undisclosed 

associates.  Dhillon knew that, because he was a corporate insider, federal securities laws 

prohibited him from selling his stock into the securities markets without complying with various 

registration and disclosure rules designed to protect investors.   

10. At various times, Dhillon coordinated with the Veldhuis Control Group and 

Taylor to sell surreptitiously stock in the companies atop whose boards he sat.  These sales were 

conducted through various nominee shareholders and involved sales of stock that Dhillon was 

legally prohibited from selling without registering the sales with the Commission.  In certain 

instances, the nominee shareholders that effectuated the illegal sales of Dhillon’s shares included 

entities administered by the Sharp Group.   

11. Dhillon abused his senior corporate role—a position of trust and confidence—in 

order to conceal his own and others’ fraudulent conduct from investors, securities market 

intermediaries, securities regulators, and law enforcement.   

Kaitz’s Role in the Scheme 

12. Kaitz owned and operated Full Service Media LLC, a company that promoted the 

stock of public companies to retail investors.  Kaitz substantially assisted the Veldhuis Control 

Group by touting stocks that the Veldhuis Control Group sought to dump.  Kaitz promoted as 

urgent and bullish investment opportunities the stock of various publicly traded companies that 

the Veldhuis Control Group simultaneously planned to sell surreptitiously—including Vitality 

and Arch stock.  A key component of Kaitz’s touting efforts was concealing the role of the 

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Veldhuis Control Group, which paid Kaitz for his services.  For example, Kaitz falsely claimed 

when touting the stock of public companies like Vitality that third parties (which appeared to be 

unaffiliated with the public companies) paid for his services.  This concealment enabled the 

Veldhuis Control Group to anonymously sell its stock to the investors whom it simultaneously 

encouraged, through Kaitz’s stock promotional efforts, to buy the stock and thus trade in the very 

opposite direction.   

13. During an SEC investigation into one of the promotional campaigns Kaitz had run 

for the Veldhuis Group, Kaitz appeared for testimony.  During that testimony, Kaitz made false 

and misleading statements, including claims (i) that he had not received payment for the 

promotion in question from any entity other than that identified as the paying party in the 

promotion (despite having received such payments, arranged by Veldhuis, from other entities); 

and (ii) that he had no communications devices other than the two he identified to Commission 

staff (despite having had, and used in connection with the promotions in question, one of the 

Sharp Group-supplied “xPhones” that are described below).   

Taylor’s Role in the Scheme 

14. Taylor, among other things, arranged to merge a public company with one of 

Dhillon’s private companies, ultimately resulting in the distribution and fraudulent sale of shares 

associated with the resulting public company, Stevia First.  Taylor also controlled nominee 

shareholders who held and traded stock surreptitiously in concert with Dhillon and the Veldhuis 

Control Group.  In exchange for these services, Taylor received a significant cut of the illegal 

stock sale proceeds. 

 

 

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Dhillon’s Additional Illegal Stock Sales through Person A’s Companies 

15. At various times between 2011 and 2017, an individual identified herein as 

Person A operated at least two nominee companies that he created to hold and trade stock of two 

public companies atop whose boards Dhillon sat: Arch and OncoSec.  Person A illegally sold 

shares in both Arch and OncoSec on Dhillon’s behalf.    

Dhillon’s False Statements During the Commission’s Investigation  

16. In October 2018, the Commission charged Wintercap SA—one of the Veldhuis 

Control Group’s primary conduits for the illegal sale of stock—with engaging in securities fraud, 

and Wintercap SA’s illegal sale of Vitality stock was cited in the Commission’s Complaint in 

that action.  Early the following month, the Commission suspended trading in Vitality.  During 

the Commission’s investigation leading to the filing of the instant action, the Commission sought 

information from Dhillon about his involvement in the Vitality scheme, and Dhillon twice 

appeared for testimony (in August 2019 and July 2020).  During that testimony, Dhillon made 

false statements that are illustrated below.  

The Defendants Violated Various Securities Laws 

17. As a result of the conduct alleged herein, Sharp, Kelln, Veldhuis, Sexton, Friesen, 

Dhillon, and Taylor violated Sections 17(a)(1) and (3) of the Securities Act of 1933 (“Securities 

Act”) and Section 10(b) of the Securities Exchange Act of 1934 (“Exchange Act”) and Rules 

10b-5(a) and (c) thereunder; Sharp, Kelln, Veldhuis, Sexton, Friesen, and Dhillon violated 

Sections 5(a) and 5(c) of the Securities Act; Veldhuis, Sexton, and Friesen violated Section 13(d) 

of the Exchange Act and Rule 13d-1 thereunder; Dhillon violated Sections 13(d) and 16(a) of the 

Exchange Act and Rules 13d-2 and 16a-3 thereunder; Taylor violated Section 15(b) of the 

Securities Act by aiding and abetting Dhillon’s violations of Sections 5(a) and 5(c) of the 

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Securities Act; Sharp and Kelln violated Section 15(b) of the Securities Act and Section 20(e) of 

the Exchange Act by aiding and abetting others’ violations of Sections 5(a), 5(c), 17(a)(1) and 

17(a)(3) of the Securities Act and Section 10(b) of the Exchange Act and Rules 10b-5(a) and 

10b-5(c) thereunder; Gasarch violated Section 17(a)(3) of the Securities Act, and also violated 

Section 15(b) of the Securities Act and Section 20(e) of the Exchange Act by aiding and abetting 

others’ violations of Sections 17(a)(1) and 17(a)(3) of the Securities Act and Section 10(b) of the 

Exchange Act and Rules 10b-5(a) and 10b-5(c) thereunder; and Kaitz violated Section 17(a)(3) 

of the Securities Act, and also violated Section 15(b) of the Securities Act and Section 20(e) of 

the Exchange Act by aiding and abetting others’ violations of Sections 17(a)(1) and 17(a)(3) of 

the Securities Act and Section 10(b) of the Exchange Act and Rules 10b-5(a) and 10b-5(c) 

thereunder. 

18. The Commission seeks a temporary restraining order prohibiting the Defendants 

from future violations of Section 17(a) of the Securities Act and Section 10(b) of the Exchange 

Act and Rule 10b-5 thereunder; prohibiting Veldhuis, Sexton, and Friesen from future violations 

of Section 13(d) and Rule 13d-1 thereunder; prohibiting Dhillon from violations of Section 13(d) 

of the Exchange Act and Rule 13d-2 thereunder; prohibiting Dhillon from future violations of 

Exchange Act Section 16(a) and Rule 16a-3 thereunder; prohibiting Sharp, Kelln, Veldhuis, 

Sexton, Friesen, Dhillon and Taylor from violations of Securities Act Sections 5(a) and 5(c), and 

if entered, a preliminary injunction order for the same; and (ii) a repatriation order, and an order 

freezing the assets of the Defendants held for their direct or indirect benefit, and/or subject to 

their direct or indirect control. 

19. The Commission seeks permanent injunctions against the Defendants, enjoining 

them from engaging in the transactions, acts, practices, and courses of business alleged in this 

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Complaint; disgorgement of all ill-gotten gains from the unlawful conduct set forth in this 

Complaint, together with prejudgment interest pursuant to Section 21(d) of the Exchange Act; 

civil penalties pursuant to Section 20(d) of the Securities Act and Section 21(d)(3) of the 

Exchange Act; an order barring the Defendants from participating in any offering of a penny 

stock, pursuant to Section 20(g) of the Securities Act and/or Section 21(d) of the Exchange Act; 

conduct-based injunctions enjoining the Defendants from directly or indirectly, including, but 

not limited to, through an entity owned or controlled by any of them, participating in the 

issuance, purchase, offer, or sale of any security; provided, however, that such injunction shall 

not prevent defendants from purchasing or selling securities listed on a national securities 

exchange for their own personal account; and such other relief as the Court may deem 

appropriate.  Further, as to Dhillon, the Commission seeks an officer and director bar pursuant to 

Section 20(e) of the Securities Act and Section 21(d) of the Exchange Act.   

JURISDICTION AND VENUE 

20. This Court has jurisdiction over this action pursuant to Section 22(a) of the 

Securities Act [15 U.S.C. §77v(a)] and Sections 21(d), 21(e), and 27 of the Exchange Act [15 

U.S.C. §§78u(d), 78u(e), 78aa]. 

21. Venue lies in this Court pursuant to Section 22(a) of the Securities Act [15 U.S.C. 

§77v(a)] and Section 27 of the Exchange Act [15 U.S.C. §78aa].  Certain of the acts, practices, 

transactions and courses of business alleged in this Complaint occurred within the District of 

Massachusetts, and were affected, directly or indirectly, by making use of means or 

instrumentalities of transportation or communication in interstate commerce, or the mails.  For 

example, Dhillon sat atop the board of Arch, a Massachusetts-based issuer.  

 

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DEFENDANTS 

22. Frederick L. Sharp, age 69 and born in Los Angeles, California, resides in West 

Vancouver, British Columbia, Canada.   

23. Zhiying Yvonne Gasarch a/k/a Zhiying Chen, age 49 and born in China, is a 

dual citizen of Canada and China, and resides in Richmond, British Columbia, Canada.   

24. Courtney Kelln, age 41, resides in Surrey, British Columbia, Canada.  

25. Mike K. Veldhuis, age 41 and born in the Netherlands, resides in Vancouver, 

Canada.  

26. Paul Sexton, age 53 and born in the United Kingdom, resides in Anmore, British 

Columbia, Canada.  

27. Jackson T. Friesen, age 33, lives in Delta, British Columbia, Canada.   

28. William T. Kaitz, age 40, lives in Arnold, Maryland. 

29. Graham R. Taylor, age 51 and born in the United Kingdom, resides in 

Vancouver, British Columbia, Canada on information and belief. 

30. Avtar Singh Dhillon, MD, age 60 and born in India, is a Canadian citizen 

residing in Long Beach, California.  Dhillon is currently the chairman of the board of directors of 

Emerald Health Therapeutics, Inc., a Canadian company that publicly trades in the United States 

markets.  Further: 

a. Between approximately April 2013 and July 2018, Dhillon was the chairman of 

the board of directors of Arch. 

b. Between approximately March 2009 and January 2019, Dhillon was the chairman 

of the board of directors of Inovio Pharmaceuticals, Inc. (“Inovio”). 

c. Between approximately January 2012 and April 2019, Dhillon was the chairman 

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of the board of directors of Vitality, including its predecessor, Stevia First Corp. 

d. Between approximately March 2011 and April 2020, Dhillon was the chairman of 

the board of directors of OncoSec.   

RELATED PARTIES 

31. Vitality Biopharma, Inc. (“Vitality”), formerly known as Stevia First Corp. 

(“Stevia First”), currently trades on the Over-the-Counter (“OTC”) Markets Group, Inc. (“OTC 

Markets”), an interdealer quotation service that provides a platform to buy and sell securities.  

Vitality was incorporated in Nevada in 2007 and its principal place of business is in Los 

Angeles, California.  Throughout its history, Vitality has undergone several changes to its 

business plan and now purports to be in the business of developing cannabinoid drugs for 

medical treatment.  At all times relevant to this Complaint, Vitality’s common stock was 

registered under Section 12(g) of the Exchange Act, and it files Exchange Act reports with the 

Commission pursuant to the reporting requirements of Section 13(a) of the Exchange Act.   

32. Arch Therapeutics Inc. (“Arch”) currently trades on OTC Markets.  It was 

incorporated in Nevada in September 2009, and its principal place of business is in 

Massachusetts.  The company has had different purported business objectives over the years; it 

currently purports to be focused on “developing a novel approach to stop bleeding 

(“hemostasis”), control leaking (“sealant”) and manage wounds during surgery, trauma and 

interventional care.”  Arch’s common stock is, and has been since June 2013, registered with the 

Commission pursuant to Section 12 of the Exchange Act.   

33. OncoSec Medical Incorporated (“OncoSec”) currently trades on NASDAQ (to 

which it was uplisted, from the OTC Markets, in May 2015).  It is a Nevada corporation 

headquartered in Pennington, New Jersey and San Diego, California.  The company purports to 

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be a biotechnology company focused on designing, developing and commercializing innovative 

therapies and proprietary medical approaches to stimulate and to guide an anti-tumor immune 

response for the treatment of cancer.  OncoSec’s common stock is, and has been since March 

2011, registered with the Commission pursuant to Section 12 of the Exchange Act.   

34. Garmatex Holdings, Ltd. (“Garmatex”), now known as Evolution Blockchain 

Group, Inc., currently trades in the grey market.  It was incorporated in Nevada in 2014 and is 

located in Las Vegas, Nevada.  In 2018, the company announced a change in its business plan, 

purportedly to pivot from textiles to holding intellectual property related to blockchain 

technology, and changed its name to Evolution Blockchain.  The Commission suspended trading 

in the securities of Evolution Blockchain on June 25, 2018.  During the time period of the trading 

described in this Complaint, the company voluntarily filed periodic reports with the Commission. 

BACKGROUND 

35. Before selling stock, control persons are required to: (a) register such sales with 

the Commission pursuant to Section 5 of the Securities Act [15 U.S.C. §77e]; (b) sell the stock 

pursuant to an applicable exemption from registration; or (c) sell the stock pursuant to conditions 

set forth in SEC Rule 144 [17 C.F.R. §240.144], including limitations on the amount of stock a 

control person can legally sell.  In addition, investors in certain public companies are required 

publicly to disclose any ownership interest in excess of 5% of the company’s publicly traded 

stock.  Such registration requirements, sale restrictions, and disclosure obligations are safeguards 

designed to protect the market for purchases and sales of stock, and to inform investors about the 

nature of the stock they are holding or considering buying, and from whom they would be 

buying that stock.   

36. An “affiliate” of an issuer is a person or entity that, directly or indirectly through 

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one or more intermediaries, controls, is controlled by, or is under common control with, such 

issuer (i.e., a control person).  “Control” means the power to direct management and policies of 

the company in question.  Affiliates include officers, directors and controlling shareholders, as 

well as any person who is under “common control” with or has common control of an issuer.  As 

used herein, the term “control group” means a group that collectively is an “affiliate” of an 

issuer.   

37.  “Restricted stock” includes stock of a publicly traded company (also known as an 

“issuer”) that has been acquired from an issuer, or an affiliate of an issuer, in a private 

transaction that is not registered with the Commission.  All stock held by an issuer or affiliate of 

an issuer is restricted stock.  Absent an exemption under the federal securities laws and rules, 

restricted stock cannot legally be offered or sold to the public unless a registration statement has 

been filed with the Commission (for an offer) or is in effect (for a sale).  A registration statement 

contains important information about an issuer’s business operations, financial condition, results 

of operation, risk factors, and management.  It also identifies any person or group who is the 

beneficial owner of more than 5% of the company’s securities.   

38.  “Unrestricted stock” is stock that may legally be offered and sold in the public 

securities marketplace by a non-affiliate, ordinarily after having previously been subject to a 

registration statement.  Registration statements are transaction specific, and apply to each 

separate offer and sale as detailed in the registration statement.  Registration, therefore, does not 

attach to the security itself, and registration at one stage for one party does not necessarily suffice 

to register subsequent offers and sales by the same or different parties. Thus, when a control 

person buys publicly traded or otherwise unrestricted shares in a company that s/he controls, 

those shares automatically become subject to the legal restrictions on sales by an affiliate. Such 

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legal restrictions include strict limits on the quantity of shares that may be sold in the public 

markets absent registration.  Without registration, affiliates are prohibited from selling large 

quantities of an issuer’s shares, regardless of how the affiliates obtained those shares.   

39. A “transfer agent” is a business that facilitates certain types of securities 

transactions.  Among other things, transfer agents issue and cancel certificates of a company’s 

stock to reflect changes in ownership.  Many companies that have publicly traded securities use 

transfer agents to keep track of the individuals and entities that own their stock.  Transfer agents 

routinely keep track of whether particular shares are restricted from resale. 

40.  “Penny Stock,” as used herein, generally refers to a security issued by a very 

small company that trades at less than $5 per share.   

41. “S-1 Registration Statement(s)” refer(s) to SEC Form S-1, which is a registration 

statement filed publicly by an issuer in connection with the sale of stock to shareholders. “S-1 

Shareholders,” as used herein, means shareholders who acquired stock pursuant to an S-1 

Registration Statement. 

OVERVIEW OF THE SHARP GROUP’S CONDUCT 

Obfuscating Beneficial Ownership and Control 

42. From approximately 2010 through at least 2019, the Sharp Group facilitated 

illegal sales of stock in hundreds of penny stock companies.   

43. As reflected in the table below, the Sharp Group’s stock sales generated over one 

billion dollars in gross proceeds:  

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44. Sharp, who used the code name “Bond” (styling himself after the fictional 

character James Bond), was the mastermind and leader of the Sharp Group.  Among other things, 

Sharp cultivated relationships with the Sharp Group’s clients—that is, individuals seeking 

fraudulently to sell stock in the markets to retail investors—and with various offshore trading 

platforms.  Sharp also routinely served as a liaison between dozens of clients (like the Veldhuis 

Control Group) and the trading platforms (like Wintercap SA). 

45. During the period of the scheme detailed herein, Sharp described in a 

communication to a client the following about the Sharp Group’s services: “The service provided 

is comprehensive; it is not limited to trading.  It includes pyaments [sic], loans, private 

placements and keeping clients out of jail.” (Emphasis added).   

46. Sharp oversaw the creation and deployment of various front companies, which 

served as nominee shareholders used to disguise his clients’ stock ownership and to sell stock 

surreptitiously.    

47. One of the services provided by the Sharp Group was making available offshore 

corporate nominee shareholders and individuals who would serve as the nominal owners of those 

entities.  Sharp installed these various nominal owners to pose as the beneficial owners of the 

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various entities that served as nominee shareholders.  In actuality, these individuals did not own 

or control the stock held by the nominee shareholders and generally had no role other than 

offering their names, passports, and signatures, which the Sharp Group used to incorporate and 

open accounts for the corporate nominees.  In dealing with banks, brokerages, and other financial 

services providers, these individuals were held out as actual beneficial owners.  In this way, the 

Sharp Group kept the identities of control groups hidden, while fraudulently appearing to satisfy 

the compliance requirements of the banking and securities firms where the Sharp Group opened 

these accounts.   

48. In 2002, Sharp wrote a fictionalized book about securities fraud and money 

laundering in which he described illegal conduct that parallels the Sharp Group’s business 

model.  Sharp’s book (Footloose:  Charlie Smith’s Offshore Chronicles) includes the following 

passage: 

Eventually [the client] took greater positions in the stocks, sharing the 
take with fewer partners.  This meant he had to disguise his 
shareholdings in order to avoid securities disclosure requirements and 
trading restrictions. 

Offshore companies were ideal for his purpose.  They came from 
around the world with nominee directors, but were still subject to his 
control.  The perfect situation for his masterly stock manipulations. 

49. Sharp hired and directed various individuals to operate the administrative services 

offered by the Sharp Group.  For example, Sharp oversaw the creation of a network of encrypted 

communications, including code-names for the users, encrypted electronic chat functions, and 

encrypted email functions.3  The Sharp Group purchased, configured and delivered devices that 

                                                            
3 Encrypted communications sent and received through the Sharp Group-administered server are hereinafter referred 
to as “Encrypted Communication(s).” 

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the Sharp Group referred to as “xPhones,” which were designed to be used only for the 

Encrypted Communications.   

50. Sharp also hired and directed individuals who created and administered the Sharp 

Group’s accounting system, which Sharp called “Q” (thereby expanding his James Bond 

affectations – “Q” being another fictional character in James Bond).  Given the extensive efforts 

by the Sharp Group and its clients to conceal and obscure the actual ownership and control of the 

stock they were surreptitiously selling, the Q system was essential in keeping track of the 

amounts of stock to be sold and the total proceeds being collected for each deal Sharp’s clients 

ran.  Accordingly, the Sharp Group accounted for all of the nominee shareholders’ assets in Q by 

tracking which of the nominee shareholders held which stocks (and which stocks’ sales 

proceeds) for which particular client or client group, like the Veldhuis Control Group.  The 

Sharp Group also relied on the Q system to calculate the commissions and fees it collected for 

facilitating its clients’ illegal stock sales.  

51. Sharp arranged for the Encrypted Communication services and the Q accounting 

system to be hosted on a server that was physically located on the island of Curaçao, in the belief 

that, there, it would be unreachable by U.S. securities regulators and law enforcement officials.   

52. Kelln is one of the individuals who worked for Sharp.  Kelln routinely performed 

a variety of complex administrative tasks associated with obtaining, allocating, and distributing 

blocks of shares across multiple nominee shareholders in a manner designed to conceal the Sharp 

Group’s clients’ common control of all the stock so distributed. 

53. In particular, Kelln—at the direction of Sharp and others—routinely split Sharp 

Group clients’ shareholdings into blocks of stock, each comprising less than five percent of each 

public company’s outstanding shares, to be held in the names of various nominee entities.  Kelln 

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sent an Encrypted Communication on or about February 8, 2013 to a client describing her work:  

The process is: I group certs [stock certificates] together that keep the total under 5%.  
Then I sen[d] them in for transfer to the TA [transfer agent].  Once processed the TA 
fedex’s them to the broker.  Then we wait for the shares to clear [i.e., become available 
for trading].  We only submit 1 transfer a day per broker until we have submitted all the 
shares.   
 
54. These acts enabled the Sharp Group’s clients to further conceal their control by 

making it seem as if multiple different, unrelated offshore corporate entities each held less than 

five percent of the stock of a public company when, in actuality, those offshore corporate entities 

were all under common control by the Sharp Group, and their stock in the public company was 

all held in coordinated fashion for the benefit of the Sharp Group’s clients. In this manner, the 

clients concealed the fact that they routinely held far greater than five percent of such public 

companies’ stock through the various Sharp Group-supplied nominee entities.   

55. Breaking the shares into blocks of less than five percent avoided scrutiny by 

brokerage firms and other market participants.  Brokerage firms routinely consider the 5% 

ownership threshold in determining whether particular stock sales may be part of a distribution 

that must be registered pursuant to Section 5 of the Securities Act.  Further, the OTC Markets 

requires public companies to disclose its five percent (or greater) shareholders to meet certain 

listing requirements.     

56. Once blocks of shares were broken up and dispersed among multiple nominee 

shareholders, the Sharp Group coordinated with offshore trading platforms, such as Wintercap 

SA and Blacklight SA, which specialized in depositing and liquidating stock through various 

domestic and foreign brokerage firms.  By so doing, the Sharp Group further obscured both the 

identities of the true beneficial owners and the fact that they were selling in concert. 

57. Gasarch is another one of the individuals who worked for Sharp.  Her duties 

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included arranging for transfers—typically in the form of wire transfers—of the proceeds of 

illegal stock sales, such as the sales referenced in the table appearing at ¶ 43 above.  In this role, 

Gasarch routinely arranged to transfer stock sale proceeds to accounts as directed by the Sharp 

Group’s clients in a manner designed to conceal the fact that undisclosed control persons were, 

in fact, the actual beneficial owners of the stock being sold, and the ultimate recipients of the 

sales proceeds.  Because of her role, Gasarch was routinely referred to by others involved in the 

scheme by the nickname “Wires.” 

58. Gasarch also implemented Sharp’s plan to protect the identities of the Sharp 

Group’s clients.  For example, (a) Gasarch helped to disguise the identities of actual shareholders 

by personally serving as the purported owner of a nominee shareholder—Peregrine Capital Corp. 

f/k/a Peaceful Lion Holdings—that the Sharp Group routinely used to facilitate the illegal stock 

sales on behalf of control group clients; and (b) in late 2015, around the time the Sharp Group 

distributed to clients a new set of xPhones for their use in Encrypted Communications, Gasarch 

drafted a memo with instructions about how to “delete all secure chats when xphone is shut 

down (e.g., to cross a border).”   

59. Kelln likewise made it a point to remind Wintercap SA principals of these 

security protocols, as in a November 2016 Encrypted Communication in which she noted, after 

traveling back to Canada from Switzerland, “I had to delete my phone going through customs.”  

A Wintercap SA principal responded “[w]e approve of your security.”  

The Sharp Group Benefited from Illegal Stock Sales 

60. Sharp, Kelln, and Gasarch profited handsomely from their illicit services to the 

Sharp Group’s clients.     

61. For example, between just August 2017 and July 2018, Wintercap SA transferred 

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approximately $7 million to a Marshall Islands company called Cortona Equity, Inc. (“Cortona”) 

for Sharp’s benefit.  Sharp had installed his wife’s tennis coach as the purported beneficial owner 

of Cortona.   

62. On various dates between 2010 and 2019, Kelln and Gasarch were the 

beneficiaries of more than $1 million each of funds derived from the Sharp Group’s conduct. 

SHARP GROUP EXAMPLE ONE: 
ILLEGAL SALES OF STEVIA FIRST/VITALITY BY DHILLON,  

VELDHUIS CONTROL GROUP AND TAYLOR 
 

63. By August 2011, Dhillon had become the Interim Principal Executive and 

Financial Officer of Stevia First and, by January 2012, had become its Chairman.  As detailed 

below, during and after his securing of these roles, Dhillon coordinated with the Veldhuis 

Control Group and Taylor fraudulently to sell Stevia First/Vitality4 stock to retail investors at 

inflated prices on various occasions over several years.  Further, Sharp, Kelln, Veldhuis, Friesen, 

Sexton, Taylor and Dhillon failed to register their sales of Stevia First/Vitality stock described 

herein pursuant to Section 5 of the Securities Act. 

64. Defendants’ successive campaigns to sell Stevia First/Vitality stock fraudulently 

were very successful.  The following table reflects the proceeds that several of the Defendants’ 

illicit sales of Stevia First/Vitality stock generated during the scheme (the “quantity sold” in the 

table below reflects the number of shares sold, and incorporates a 1-for-10 reverse stock split in 

2016).    

                                                            
4 Stevia First changed its name to Vitality in 2016, and the company still operates under that name.  Stevia First and 
Vitality stock is referred to as “Stevia First/Vitality” in this Complaint.    

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Background 

65. By early 2011, Dhillon controlled a private company called Stevia First.  Around 

that time, Dhillon looked for an opportunity to convert that business to a publicly traded 

company in a process known as a “reverse merger.”  In a reverse merger transaction, an existing 

public company having a ticker symbol cleared for quoting on OTC Markets, but with little, if 

any, operations (often referred to as a “shell company”), acquires a private operating company.  

After the private operating company is absorbed into the public shell company, the shell 

company typically undergoes a name, ticker-symbol, and business-plan change, to align with the 

name and purported business of the formerly private operating company.  In such transactions, 

shareholders of the formerly private company frequently receive shares in the newly merged 

public company.  In many instances, those shares comprise a controlling interest in the post-

merger public company. 

66. In or about early 2011, Taylor introduced Dhillon and the then-Chief Executive 

Officer (the “CEO”) of Dhillon’s private company to certain of Taylor’s contacts in China and to 

an attorney in Vancouver.  Dhillon and the CEO eventually merged the private company with a 

public shell company.  On paper, the bulk of the shares in the shell company were held by 

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various Chinese nationals who were identified in an S-1 registration statement that had 

previously been filed by the shell company (hereinafter the “Stevia S-1 Shareholders”).   

67. According to public filings, on July 28, 2011, the purported president, chief 

executive officer, treasurer and director of the public shell company agreed to sell all of his 

4,500,000 shares to Dhillon pursuant to a stock purchase agreement.  The stock purchase 

agreement contemplated that, immediately upon closing of the reverse merger, Dhillon would be 

appointed as a director, and as the President, Chief Executive Officer, Secretary, and Treasurer, 

of the surviving public company. 

68. On or about October 10, 2011, the reverse merger went effective and the 

surviving public company was re-named Stevia First, thereby assuming the name of Dhillon’s 

private company.   

69. On or about October 12, 2011, Stevia First effected a 7-for-1 forward stock split, 

which caused Dhillon’s 4,500,000 shares (referenced in ¶ 67) to convert to 31,500,000 shares of 

Stevia First/Vitality stock.   

70. Dhillon was the sole signer of Stevia First’s filing with the Commission, which 

reported the 7-for-1 forward stock split.  The stock split had the effect of increasing the number 

of shares held by Dhillon considerably.   

71. In or about January 2012, Dhillon assumed the role of chairman of Stevia First’s 

board of directors.  Stevia First/Vitality’s stock was registered pursuant to Section 12 of the 

Exchange Act. 

72. Dhillon was an affiliate of Stevia First (and, subsequently, Vitality) because he 

had the power to control the company through his role as chairman of its board.  As a public 

company affiliate, Dhillon was legally required to register any sales of his Stevia First/Vitality 

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stock unless Dhillon elected to comply with the safe harbor provisions set forth in Commission 

Rule 144.  Dhillon testified, under oath, during the Commission’s investigation leading to the 

filing of this action that he understood these legal requirements at all times relevant to this 

Complaint.  As described in more detail in this Complaint, Dhillon repeatedly sold shares of 

Stevia First/Vitality without registering such sales.  

73. As a director of Stevia First (and, eventually, Vitality), Dhillon was required to 

file various “Form 4” statements (i.e., a “Statement of Changes of Beneficial Ownership of 

Securities”), which is a public form required by the Commission pursuant to Section 16(a) of the 

Exchange Act and Rule 16a-3 thereunder.  Dhillon was required to file an updated Form 4 to 

reflect any change in his beneficial ownership of Stevia First/Vitality stock, regardless of the 

amount of that change.  Dhillon understood these legal requirements at all times relevant to this 

Complaint.  Dhillon testified, under oath, during the Commission’s investigation leading to the 

filing of this action that “[a]nytime there’s sales by insiders, you have to file appropriate forms to 

disclose your purchases or sales.”   

74. Dhillon was also legally required to file a public disclosure report—a “Schedule 

13D”—with the Commission pursuant to Section 13(d) of the Exchange Act and Rules 13d-1 

and 13d-2 thereunder, to the extent he was the beneficial owner of greater than five percent of 

Stevia First/Vitality’s common stock.  Dhillon was likewise required to disclose, via a Schedule 

13D filing, any agreements he entered into concerning disposition of Stevia First stock, as well 

as the combined holdings of all participants in any such agreements.  Dhillon was further 

required to file a Schedule 13D Amendment whenever his position materially changed.  Dhillon 

understood these legal requirements at all times relevant to this Complaint.  For example, on or 

about August 17, 2011, Dhillon filed a Schedule 13D with the Commission disclosing that he 

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was the beneficial owner of 4,500,000 restricted shares of Stevia First/Vitality stock, which 

comprised more than five percent of the company’s outstanding common shares at that time.  As 

described in more detail in this Complaint, Dhillon intentionally failed to disclose his beneficial 

ownership interest in additional shares of Stevia First/Vitality stock, which were purportedly 

unrestricted; and he never made any disclosure concerning his agreements with the Veldhuis 

Group concerning Stevia First stock. 

Round One: 2012 Stevia First/Vitality Stock Sales 

75. Beginning in January 2012, shortly after Dhillon took over Stevia First, Dhillon, 

Taylor, and the Veldhuis Control Group arranged to sell surreptitiously Stevia First/Vitality’s 

purportedly unrestricted stock and share in the proceeds of those unregistered sales.   

76. First, Taylor, working in concert with others, facilitated the transfer of Stevia 

First/Vitality’s purportedly unrestricted stock from the Stevia S-1 Shareholders (defined in ¶ 66) 

to, initially, fifteen Sharp Group-administered nominee companies that held the stock for the 

Veldhuis Control Group.  Shortly thereafter, the Sharp Group consolidated or further transferred 

shares held by several of these Sharp Group-administered shareholders into other Sharp Group-

administered shareholders, including Peaceful Lion Holdings, a nominee shareholder for which 

Gasarch personally served as purported owner, and thus as purported owner of any shares held 

by it.  The flow chart below reflects these transfers:5 

                                                            
5 The entities color coded in green in this chart and other charts within this Complaint were administered or 
otherwise utilized, directly or indirectly, by the Sharp Group.  

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77. Between January and March 2012, the Sharp Group-administered nominee 

shareholders (including Gasarch’s Peaceful Lion Holdings) received 19,600,000 shares of Stevia 

First/Vitality stock, representing over 37% of the company’s total outstanding stock and over 

97% of its purportedly unrestricted stock.  These particular shares, which were all issued without 

restrictive legend, are hereinafter referred to as the “‘Unrestricted’ Stevia First Merger Shares.”  

(Shares issued without restrictive legend are commonly treated by securities brokers and transfer 

agents as immediately and freely tradeable.  In reality, however, these ‘Unrestricted’ Stevia First 

Merger Shares were held by affiliates of the issuer who were acting in league with its Chairman.  

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As such, these shares were, as a matter of law, restricted, and thus were subject to the federal 

securities laws’ limitations and restrictions on unregistered sales of such shares.) 

78. In March 2012, Stevia First—with Dhillon serving as the chairman of its board of 

directors—began to issue press releases claiming various positive business developments for the 

company while, at or about the same time, the Veldhuis Control Group orchestrated a 

promotional campaign touting Stevia First’s stock.   

79. For example, the Veldhuis Control Group paid for promotional materials touting 

Stevia First that were disseminated to investors during approximately March through May 2012.  

These Stevia First promotional materials urged investors to buy and buy quickly, saying things 

like, “Get in now; this is huge!” (emphasis in original) and “Buy STVF right now!” (emphasis 

in original; “STVF” was Stevia First’s ticker symbol).  These promotional materials 

misleadingly claimed both that “Conmar Capital Inc.” was the paying party, and that Conmar 

Capital “will not trade in the securities of Stevia First.”  In fact (i) it was the Veldhuis Group, 

which controlled the overwhelming majority of Stevia First’s free-trading shares, that paid for 

the promotions; (ii) the Veldhuis Control Group had paid the Sharp Group to incorporate 

Conmar Capital; and (iii) although no Stevia First trading took place (at the time of the 

campaign) through Conmar Capital, the Veldhuis Control Group was indeed “trad[ing] in the 

securities of Stevia First” by massively unloading them on the very retail investors who were 

buying in response to that campaign. 

80. The Veldhuis Control Group also engaged Kaitz to promote Stevia First, 

including through paying Kaitz’s stock promotion company over $200,000 on or about April 3, 

2012.   

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81. Overall, from approximately March 6, 2012 to May 23, 2012, the Veldhuis 

Control Group, with Kaitz’s substantial assistance, unloaded every share of the ‘Unrestricted’ 

Stevia First Merger Shares into the market, generating illicit proceeds of over $24 million. 

82. Both Taylor and Dhillon contemporaneously shared in the illicit proceeds 

stemming from the Veldhuis Control Group’s March-May 2012 lucrative unloading of Stevia 

First stock, described above.  In particular, between approximately April and June 2012, the 

Veldhuis Control Group used the Sharp Group to remit eight wire payments, all funded by Stevia 

First stock-sale proceeds, and totaling over $4.2 million, to the Swiss bank account of an 

offshore front company that Taylor controlled; and Taylor, in turn, promptly transferred over 

60% of that money to Dhillon as follows: 

Date Veldhuis Control Group 
Transfers to Taylor’s 

Company 

Taylor Transfers to 
Dhillon’s Companies 

April 12, 2012 $610,200  
April 12, 2012 $498,900  
April 13, 2012 $496,800  
April 17, 2012  $498,000 
May 4, 2012  $400,000* 
May 11, 2012  $496,000* 
June 8, 2012 $475,000  
June 8, 2012 $800,000  
June 8, 2012 $900,000  
July 16, 2012  $1,300,000* 

*Each of these transfers went to the Swiss bank account of a front company incorporated in 
Panama called Ortivo Enterprises Corp. (“Ortivo”) that Dhillon controlled. 
 
83. To further conceal the identities of the people sharing in the illicit proceeds from 

the unregistered sale of the ‘Unrestricted’ Stevia First Merger Shares, as well as the illicit source 

of those proceeds, the Veldhuis Control Group distributed portions of those proceeds in cash 

obtained from the Sharp Group on various dates.  These cash withdrawals were recorded in the Q 

system and allocated to the Stevia First deal.   

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Round Two: 2014 Stevia First/Vitality Stock Sales 

84. On or about March 30, 2012, May 25, 2012, and February 13, 2014, Stevia First 

issued a total of 1,320,511 shares of Stevia First/Vitality stock to a Sharp Group-administered 

nominee shareholder.  The Sharp Group, in turn, divided those shares between two additional 

Sharp Group-administered nominee shareholders.  The table below reflects these transfers. 

 

85. Thereafter, the Veldhuis Control Group sold these shares through Sharp Group-

administered nominee shareholders for the benefit of Dhillon, the Veldhuis Control Group, and 

Taylor.  Specifically, between approximately January 14, 2014 and July 14, 2014, the Veldhuis 

Control Group sold all 1,320,511 of these Stevia First/Vitality shares through at least two 

offshore brokerage firms, obscuring the shares’ ownership and the disposition of their proceeds 

by running the trades through two Sharp Group-administered nominee shareholders. 

86. Kelln facilitated the unregistered sale of the 1,320,511 Stevia First/Vitality shares.  

For example, on or about October 9, 2013, Kelln provided Stevia First’s transfer agent with the 

required paperwork to transfer 625,000 of the 1,320,511 shares of Stevia First/Vitality shares to 

Nautilus Growth Fund.  Kelln also provided a check to pay for the transfer.  The documents 

provided by Kelln to Stevia First’s transfer agent included an attorney opinion letter that falsely 

represented that Nautilus Growth Fund was not an affiliate of Stevia First.  Kelln knew, or 

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recklessly disregarded, that Nautilus Growth Fund was merely a nominee shareholder holding 

stock for the Veldhuis Control Group, which was an affiliate of Stevia First.     

87. As the Veldhuis Control Group sold shares, Veldhuis, Sexton, and Friesen 

discussed distributing the proceeds from the sale of the 1,320,511 shares of Stevia First/Vitality 

stock in a furtive manner that was designed to conceal the funds’ source as well as their ultimate 

recipients. 

88. For example, on or about February 25, 2014, Sexton and Veldhuis discussed in an 

Encrypted Communication their plan to distribute a pool of proceeds from the sale of the 

1,320,511 shares of Stevia First/Vitality stock in “cash” and noted that “AV will be fine with 

[our so distributing] it.”  “AV” is a reference to Avtar Dhillon.   

89. On or about March 6, 2014, Veldhuis sent the following Encrypted 

Communication to Friesen: “u r getting 173k today.  A cut from MDDD [the ticker symbol of 

another public company stock the Veldhuis Control Group fraudulently sold through the Sharp 

Group] and STVF [the ticker symbol of Stevia First in 2014].  Buy a boat [expletive].  Rich 

mother [expletive].”  Of the “173k” (i.e. $173,000) referred to by Veldhuis in the Encrypted 

Communication to Friesen, $100,000 came from proceeds of selling the 1,320,511 shares of 

Stevia First/Vitality stock.  

90. On or about March 6, 2014—around the same time that Veldhuis was 

coordinating the distribution of Stevia First/Vitality stock sale proceeds to Friesen (and others)—

the Veldhuis Control Group caused the Sharp Group to send $124,000 in Stevia First/Vitality 

stock-sale proceeds to the same Taylor Swiss bank account referenced in ¶ 82 above. 

91. On various dates later in 2014, the Veldhuis Control Group continued to sell 

Stevia First/Vitality stock.  For example: 

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a. On or about May 28, 2014, Friesen sent an Encrypted Communication, 

copying Veldhuis, directing a trader working for Sharp to sell 25,000 shares of 

Stevia First/Vitality stock that was held in an account in the name of a Sharp 

Group-administered nominee shareholder. 

b. On or about July 7, 2014, Friesen sent an Encrypted Communication directing 

a trader working for Sharp to sell 25,000 shares of Stevia First/Vitality stock.   

92. On or about August 5, 2014, Veldhuis sent an Encrypted Communication asking 

Gasarch the following: “How much cash do you have in total.  We might cut the balance of 

STVF [Stevia First] that’s left.  So we would need about $110K.  Do you have or be able to get?” 

93. On or about August 6, 2014, Veldhuis sent a follow up Encrypted Communication 

to Gasarch: “Can I please get $120K cash from STVF?”   

94. On or about August 6, 2014, Veldhuis picked up $120,000 in cash from Sharp’s 

office.   

95. On or about August 6, 2014, Sexton and Veldhuis continued to discuss, via 

Encrypted Communications, the planned distribution of proceeds from selling the 1,320,511 

shares of Stevia First/Vitality stock.  Veldhuis wrote: “so STVF with the two wires being added 

back is 126,693.74 . . . Avtar 50,000 (40%) . . . [there is] enough cash to do it might [sic] be 

easier to transfer.”   

96. During the same August 6, 2014 Encrypted Communication, Sexton replied: 

“You should cut up the 120,000 [in] cash.  Which would allow for . . . Avtar/GT [Dhillon and 

Taylor] 42,000[.] So if you want to bring me 96k on Friday I can distribute?  GT [Taylor] will be 

up here shortly . . . .”   

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97. During the same August 6, 2014 Encrypted Communication, Veldhuis asked 

Sexton how he should transmit the cash, writing, “U want me to put in the safety deposit box or 

bring it to you.”  Sexton replied: “You can do either.  I have a safe here.  I can distribute mind 

[sic] and grahams [Taylor] from here.  I can hold . . . av’s [Avtar Dhillon’s] for next meeting.”   

98. On or about August 7, 2014, Veldhuis reported to Sexton via an Encrypted 

Communication that “I pick up [sic] that cash yesterday.  Its [sic] all 50’s.”   

99. Similarly, between approximately November 2013 and January 2015, Taylor 

arranged to transfer approximately $1.7 million to third parties for Dhillon’s benefit.   

100. Dhillon failed to file any Form 4 disclosing the sales of Stevia First stock directed 

by the Veldhuis Control Group, despite having a pecuniary interest in Stevia First stock sales 

effected through the Veldhuis Group, and despite knowing of his obligations, as Chairman of 

Stevia First, to report any and all of his Stevia First stock sales on Forms 4 filed with the 

Commission.  

Round Three:  2015 and 2016 Stevia First/Vitality Stock Sales 

101. In connection with the 2011 merger of Dhillon’s private company into the public 

shell company, Dhillon received 4,500,000 restricted shares of Stevia First/Vitality stock 

(hereinafter referred to as the “March 2012 Stevia First/Vitality Stock”).  After Stevia First, 

directed by Dhillon, issued a 7-for-1 forward split of Stevia First/Vitality stock, Dhillon held 

31,500,000 shares of the March 2012 Stevia First/Vitality Stock, all of which was restricted.   

102. The scheme by the Veldhuis Control Group, Taylor and Dhillon to unload this 

March 2012 Stevia First/Vitality Stock through another round of illicit stock sales began in 

March 2012.   

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103. The first step in this facet of the scheme was to move Stevia First/Vitality stock 

into the hands of the Veldhuis Control Group, while concealing the common ownership and 

control of this large block of shares.     

104. As with prior illegal sales of Stevia First/Vitality stock, several of the Defendants 

used multiple Sharp Group-supplied entities as nominee shareholders, each purporting to hold 

less than 5% of the company’s shares, in order to conceal the fact that affiliates of the issuer 

were, in concert, controlling, and would be illegally selling, unregistered shares of Stevia 

First/Vitality stock.    

105. To that end, in or about March 2012 (i) Sharp authorized, through a wire request 

he signed, a payment to Dhillon in the amount of $33,800, and (ii) Taylor also directed two 

payments totaling $9,450 to Dhillon.  These payments were all made to Dhillon’s personal bank 

account.   

106. Sharp’s March 2012 $33,800 payment to Dhillon—which was funded by 

proceeds from the Veldhuis Control Group’s sale of the ‘Unrestricted’ Stevia First/Vitality 

Merger Shares earlier that month—was for the purchase of 15,750,000 shares of Dhillon’s 

March 2012 Stevia First/Vitality Stock.  Meanwhile, Taylor’s March 2012 payments (for a total 

of $9,450) were for the purported purchase of another 4,227,500 shares of Dhillon’s March 2012 

Stevia First/Vitality Stock.   

107. To conceal the common control and disposition of the roughly 20 million shares 

of March 2012 Stevia First/Vitality Stock shares that Dhillon had transferred based on the 

aforementioned Sharp- and Taylor-arranged payments, Dhillon disguised his transfers as a series 

of smaller sales to (i) various Sharp Group-administered shareholders—all of which would hold, 

and ultimately sell, the Stevia First/Vitality stock for the benefit of the Veldhuis Control Group 

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and Dhillon—and (ii) two nominee shareholders that were controlled by Taylor, which would 

hold, and ultimately sell, the Stevia First/Vitality stock for Taylor’s and Dhillon’s benefit.  The 

chart below illustrates Dhillon’s sale of these shares, as well as Dhillon’s division of the 

remaining shares that were derived from the March 2012 Stevia First/Vitality Stock.  (In fact, 

however, as detailed below, Dhillon did not fully relinquish his interest in the March 2012 Stevia 

First/Vitality Stock.):6 

 

                                                            
6 Heng Hong is another nominee shareholder controlled by Taylor.   

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108. The roughly 20 million shares of the March 2012 Stevia First/Vitality Stock that 

Dhillon transferred to nominee shareholders administered by the Sharp Group or Taylor 

comprised approximately 39 percent of the company’s outstanding shares.  But, by spreading 

these shares among various nominee shareholders, each shown as holding under five percent of 

the company’s outstanding shares, Dhillon obscured the facts that (i) he had not, in truth, 

relinquished his interests in all of these shares; and (ii) these shares were, in truth, held by the 

Veldhuis Control Group, himself, and Taylor, all of whom were acting in concert.  

109. The Veldhuis Control Group and Taylor did not immediately sell the shares held 

by the nominee shareholders referenced in ¶ 107 above, at least partly because the stock was 

initially marked as restricted by Stevia First’s transfer agent since it was acquired directly from 

Dhillon, an affiliate of the company.  SEC Rule 144 provides a safe harbor from registering the 

sale of restricted stock acquired directly from an affiliate if, among other things, the acquirer(s) 

hold those shares for at least six months.  In the meantime, the Veldhuis Control Group sold the 

other Stevia First/Vitality stock that they had obtained, as described in ¶¶ 76 through 77 (“Round 

1”) and ¶¶ 84 through 85 (“Round 2”), above.   

110. Beginning in the fall of 2014, the Veldhuis Control Group arranged for the 

unregistered sale of the March 2012 Stevia First/Vitality Stock in concert with Taylor and 

Dhillon. 

111. In an Encrypted Communication on or about October 24, 2014, Veldhuis, Sexton 

and Friesen discussed their plans to sell the March 2012 Stevia First/Vitality Stock into the 

public markets.  In particular, Sexton summarized the Veldhuis Control Group’s plans to sell the 

15,750,000 shares that Dhillon had transferred to the various Sharp Group-administered nominee 

shareholders, which included 1,000,000 shares to be sold for Dhillon’s benefit, and raised the 

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possibility of coordinating those sales with sales of the shares Dhillon had transferred to Taylor’s 

nominee shareholders, writing: “There was 31,500,000 in total. We have 15,750,000 minus the 

1mm to Avtar [Dhillon].  GTaylor is outside the 15.75.  He would consider blending back if Av 

[Dhillon] agrees to the plan.”  (Emphasis added). 

112. Taylor, as illustrated in ¶ 106 above, held approximately 4.2 million additional 

shares via two nominee shareholders, which is consistent with Sexton’s referring to Taylor’s 

position, in the above-quoted Encrypted Communication, as “outside the 15.75” million shares 

held by various Sharp Group-administered nominee shareholders. 

113. On or about October 28, 2014, Sexton met with Dhillon in California, and 

summarized their meeting in an Encrypted Communication between Sexton and Veldhuis the 

following day in these words:  

a. Dhillon “said that stv [Stevia First] is working 2 big food producers and they 

feel that one has a very good chance to come to table.  He would like to be 

more aggressive and get the price and volume up. . . . He’s also sharing in part 

of grahams [Taylor’s] retained [sic] position.”    

b. “Also, av [Dhillon] said that he would prefer if we took the shares in gt 

[Taylor’s] names and sold them all together.  Lol.”   

114. On various dates thereafter, Taylor, directly or indirectly, transferred the March 

2012 Stevia First/Vitality Stock held by his two nominee shareholders to Sharp Group-

administered nominee shareholders that were used by the Veldhuis Control Group.  For its part, 

in or about December 2014, the Veldhuis Control Group arranged to sell March 2012 Stevia 

First/Vitality Stock through Wintercap SA and Blacklight SA using Sharp Group-administered 

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nominee shareholders.  The chart below reflects the transfers to various Sharp Group-

administered nominee shareholders: 

 

115. On or about December 2, 2014, Veldhuis sent an Encrypted Communication to 

Gasarch, copying Sharp, to determine if the nominee shareholders his team had been using to 

hold March 2012 Stevia First/Vitality Stock were administered by the Sharp Group, or some 

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other offshore nominee shareholder provider.  Veldhuis wrote: “[w]e are in the process of 

receiving approximately 20 million shares of [Vitality] that were held in ESCROW.  At the time 

of ESCROW agreement we may have put some of the stock in NON BOND [i.e. non-Sharp] 

[nominee] entities.  Can you please go through the list below and let me know which entities you 

guys administer.”  (Veldhuis’s reference to “approximately 20 million” comports with the sum of 

(i) the 15,750,000 shares of March 2012 Stevia First/Vitality Stock that Dhillon transferred to the 

various Sharp Group-administered nominee shareholders in 2012, plus (ii) the approximately 4.2 

million shares of March 2012 Stevia First/Vitality Stock that Dhillon transferred to two nominee 

shareholders controlled by Taylor.)    

116. Sharp, copying Kelln, replied to Veldhuis’s December 2, 2014 Encrypted 

Communication by writing: “This [message] shld have gone to celtic.”  “Celtic” was Kelln’s 

pseudonym.  Kelln promptly replied: “I confirm they [nominee shareholders] are all ours [i.e, 

Sharp Group-administered nominee shareholders].” 

117.   Kelln subsequently arranged for the Veldhuis Control Group’s stock, which now 

included the approximately 4.2 million shares initially held by Taylor’s two nominee 

shareholders, to be deposited into accounts controlled by Wintercap SA and Blacklight SA.   

118. Thereafter, during the course of 2015 and early 2016, the Veldhuis Control Group 

directed the unregistered sales of March 2012 Stevia First/Vitality Stock in coordination with 

another stock promotional campaign run by Kaitz. 

119. In or about January 2015, via an Encrypted Communication, Veldhuis asked 

Kaitz who Kaitz would identify as the “third party” payer on the Stevia First/Vitality stock 

promotional alerts.  Kaitz replied, “Conmar Capital,” which was the name of a Sharp Group-

administered entity that the Veldhuis Control Group had paid to incorporate in 2012.  Ultimately, 

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the January 2015 promotions identified “Full Service Media” (Kaitz’s own company), as well as 

an unidentified “third party,” as each having supplied funds to pay for those stock promotions.  

Kaitz knew that the Veldhuis Control Group was paying for the stock promotions and concealed 

this by listing “Conmar Capital” as the party paying for his promotional campaign.  Kaitz further 

knew, or recklessly disregarded, that the Veldhuis Control Group intended to sell stock 

surreptitiously and was paying for the promotional campaign in order to facilitate such sales.  

120. The members of the Veldhuis Control Group each knew or recklessly disregarded 

that stock promoters, like Kaitz, falsely identified third party payers in order to conceal the fact 

that control groups and other affiliates were sponsoring promotional campaigns in order to 

surreptitiously dump stock in the markets.  Similarly, Dhillon and Taylor knew, or recklessly 

disregarded, that the Veldhuis Control Group would retain a stock promoter to tout Stevia 

First/Vitality stock and would conceal (i) their role in funding the stock promotional campaign, 

(ii) the fact that they were part of a group that controlled the issuer, and (iii) the fact that they 

intended to trade, and were trading, in the opposite direction to which the touts urged retail 

investors to trade.    

121. On or about March 13, 2015, Sexton and Veldhuis exchanged Encrypted 

Communications concerning Dhillon and continuing the Stevia First/Vitality stock promotion: 

Sexton to Veldhuis: “Avtar said they got additional things going for stvf [the ticker 
symbol for Stevia First at the time].  To keep going with [a stock promoter] and they only 
have another 1mm to chew thru and it should clean up real nice. 
 
Veldhuis to Sexton: “Nice.” 

122. Veldhuis, on behalf of Dhillon, the Veldhuis Control Group, and Taylor, 

continued to orchestrate stock promotions concerning Stevia First/Vitality stock later in 2015.  

To that end, Veldhuis sought to identify a nominee entity that could be cited as the paying party 

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for the promotional campaign in order to conceal the fact that the Veldhuis Control Group 

actually paid for the stock promotional campaign. 

123. For example, on or about March 31, 2015, Veldhuis sent an Encrypted 

Communication, subject line “promo,” to Sharp asking if one of eight Sharp Group-administered 

nominees “can be used . . . as the payee [sic] for the promotion.  Or should we set up a new 

company?”  Sharp responded and instructed Veldhuis to use one of the preexisting nominee 

companies.   

124. On or about the same day, Veldhuis forwarded Sharp’s Encrypted 

Communication to Kelln and asked: “[c]an u please send me on[e] of the 8 companies including 

the address?”  Kelln, in turn, copied Gasarch on the Encrypted Communications chain and wrote: 

“Wire [Gasarch]: pls provide [Veldhuis] a current 2015 holding co with address.”  Later that day, 

Gasarch confirmed that she emailed the requested information to Veldhuis.    

125. On or about April 7, 2015, Veldhuis communicated with Kaitz by Encrypted 

Communications about issuing promotions concerning Stevia First/Vitality stock.   

126. On or about May 6, 2015, Veldhuis and Sexton discussed, via Encrypted 

Communications, arrangements for additional stock promotions to tout Stevia First/Vitality 

stock.  Veldhuis wrote: “I been [sic] back and forth with [Kaitz] on it today.  He had trouble 

getting ads approved on new network.  He has spent 2k this week so far and trying to get other 

stuff approved today.  Was supposed to be done by Tuesday afternoon.” 

127. On various dates in 2015 and 2016, during the promotional campaign that 

Veldhuis coordinated through Kaitz, the Veldhuis Control Group sold, via Sharp Group-

administered nominee shareholders, in total, millions of shares of the March 2012 Stevia 

First/Vitality Stock.   

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128. Dhillon received a cut of these proceeds, just as he had received distributions 

from the proceeds of the defendants’ Stevia First/Vitality stock sales in at least 2012 and 2014.  

On or about October 28, 2015, for example—consistent with Dhillon’s instruction that his cut of 

the proceeds be transferred to third parties on his behalf to obscure the fact that they were 

redounding to his benefit—the Veldhuis Control Group arranged for Wintercap SA to pay a third 

party approximately $25,000 toward an expense incurred by Dhillon’s family.    

129. Similarly, on or about June 21, 2016, Wintercap SA remitted $110,431.86 to a 

loan servicing company in Colorado.  This payment, sent from a Sharp Group-administered 

nominee entity, Morris Capital, was applied to pay a mortgage loan for Sexton’s benefit on a 

property in California. 

Round Four: 2016 – 2018 Illegal Vitality Stock Sales 

130. On or about July 10, 2016, Stevia First changed its name to Vitality and executed 

a 1-for-10 reverse split of its common stock.  The reverse split meant that shareholders were 

required to exchange 10 shares for one share, which had the effect of reducing the total number 

of outstanding shares of the company by a factor of 10.  This also had the effect of drastically 

reducing the holdings of retail investors whom Defendants had prompted to purchase shares in 

Stevia First through their previous promotional campaigns. 

131. On various dates in 2016, the Veldhuis Control Group sent numerous wire 

payments to Vitality, or to third parties on behalf of Vitality, totaling approximately $4.4 million.  

In exchange, Vitality—with Dhillon operating as the chairman of its board of directors—issued 

millions of shares (the “Vitality Stock”) to nominee entities that the Sharp Group once again 

provided for use by the Veldhuis Control Group. 

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132. The Vitality Stock shares acquired by the Veldhuis Control Group from the 

financing described in ¶ 131, above, were initially issued with restricted legends.  In order to 

facilitate the liquidation of these shares, Kelln retained an attorney on behalf of each of the 

nominee shareholder entities to prepare opinion letters that falsely represented that the nominee 

shareholders were not affiliates of Vitality. 

133. On various dates ranging between 2016 and 2018, the attorney retained by Kelln 

on behalf of the Veldhuis Control Group issued opinion letters to Vitality’s transfer agent, 

representing that none of the Sharp Group-administered nominee shareholders were affiliates of 

Vitality.  Based on these false representations, Vitality’s transfer agent removed the restricted 

legends from the Vitality Stock, thereby enabling the Veldhuis Control Group to sell the Vitality 

Stock to the public.  In actuality, the Vitality Stock was controlled by affiliates of the company 

and was legally restricted from resale.  Among other points of affiliation, the Veldhuis Control 

Group was acting in concert with Dhillon, who was the chairman of Vitality’s board.     

134. After Vitality’s transfer agent removed the restricted legend for one of the 

nominee shareholders, Kelln advised Wintercap SA of an incoming deposit of 750,000 shares of 

Vitality in the name of a Sharp Group-administered nominee shareholder called Hilton Capital.   

135. At that time, Kelln noticed from reviewing Q records that Wintercap SA was 

already holding Vitality shares (that had been previously deposited) in the name of Hilton 

Capital.  The 750,000 additional shares would have brought the total shares held by that nominee 

to more than 5% of Vitality’s issued shares.  As Kelln knew or recklessly disregarded, any 

shareholder who was the beneficial owner of more than 5% of Vitality’s outstanding stock was 

legally required to publicly disclose its holdings.  Such disclosures would have frustrated 

Dhillon’s and the Veldhuis Control Group’s efforts to conceal their stock holdings and sales.        

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136. On or about February 28, 2017, Kelln instructed Wintercap SA to allocate all 

Vitality Stock sales Wintercap was making that day to the Hilton account, thereby reducing the 

number of Vitality shares that Hilton Capital was shown as holding.  This ruse prevented Hilton 

Capital from showing share ownership in excess of 5%.  Specifically, Kelln wrote: “allocate all 

VBIO [ticker symbol of Vitality] to the [Hilton Capital] account today.  We need to make room 

for pending 750k.  Again 5% rule is biting me in the ass.”    

137. The 750,000 shares were subsequently deposited with Wintercap SA.  Thereafter, 

Veldhuis provided trading instructions to Wintercap SA to sell the Vitality Stock.   

138. In or about December 2016, during the course of another Veldhuis Group-funded, 

Kaitz-managed stock promotion touting Vitality’s stock, Wintercap SA’s principal asked 

Veldhuis through an encrypted messaging application if the Vitality Control Group could 

“switch selling to another outlet to let us [Wintercap SA] breath[e]” and slow the pace of selling.  

Veldhuis responded that he could slow the pace “on the next batch, but that’s a week out.  In the 

meantime, sell 15k VBIO @ 2.11.”  Wintercap SA’s principal suggested, in response, “[m]aybe 

2 days on, 1 day off . . . .”  In response, Veldhuis suggested that he could move the stock held at 

Wintercap SA to a competitor, Blacklight SA (“BL”).  This exchange followed: 

Veldhuis to Wintercap I will figure out how to move some elsewhere.  It pains me to give BL 
business. 

Wintercap to Veldhuis  Ok.  I don’t wish you to do that ;) 
Veldhuis to Wintercap Lol 
Wintercap to Veldhuis  We can stay on point 

 

139. In connection with their efforts to sell Vitality Stock in 2016 and later, the 

Veldhuis Control Group again retained Kaitz to conduct a promotional campaign.  Between 

October 2016 and March 2017, Veldhuis directed Wintercap SA to wire $530,000, which was 

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derived from financial accounts associated with four Sharp Group-administered nominee 

shareholders, to Kaitz’s entity for the purpose of promoting Vitality.  

*** 

140. Overall, the Sharp Group allocated Stevia First/Vitality stock sale proceeds as 

follows during the period of time subject to this Complaint: 

Defendant Approximate Amount (Millions) 

Sexton $5.5 
Veldhuis $3.1 
Friesen $2.3 
Taylor $4.3 (of which Taylor, in turn, promptly 

forwarded approximately $2.6 million to 
Dhillon, as noted in ¶ 82) 

Kaitz $1.4 
 

141. Dhillon benefited by receiving millions of dollars from the proceeds of these 

illegal stock sales, including through payments made by the Veldhuis Control Group and Taylor 

to various third parties on Dhillon’s behalf. 

The Veldhuis Control Group’s Omissions in Furtherance of the Scheme 

142. Veldhuis, Sexton and Friesen acted as a group for purposes of acquiring, holding, 

and ultimately disposing of Vitality shares, and consequently became subject to regulation as a 

single person pursuant to Exchange Act Section 13(d)(3).  Veldhuis, Sexton and Friesen failed to 

file any report on behalf of the group as required under Rule 13d-1(k)(2), even though they 

collectively acquired, held, and were responsible for directing the disposition of, far more than 

5% of Vitality’s outstanding stock through nominee entities that were under their group’s 

control.  

143. In failing to make required Schedule 13D/G filings, Veldhuis, Sexton, and Friesen 

violated Section 13(d) and Rule 13d-1 thereunder.   

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Dhillon’s Failures to Disclose in Furtherance of the Scheme 

144.   On August 17, 2016, Dhillon filed an untimely and inaccurately amended 

Schedule 13D (specifically, a Schedule 13D/A) with the Commission.  Dhillon reported that he 

was the beneficial owner of 1,530,585 shares (post stock split) consisting of:  

a. 515,000 shares issued directly by Vitality in 2012. 

b. 50,000 in stock options issued by Vitality in 2012. 

c. 40,000 shares of common stock issued by Vitality in 2015. 

d. 925,585 shares of common stock issued by Vitality in 2016. 

145. In actuality, as of August 17, 2016, Dhillon was also a beneficial owner of a 

significant number of shares of the stock held by the Veldhuis Control Group.  Dhillon did not 

report, among other things, these shares in his Schedule 13D. 

146. Dhillon also failed to file any Forms 4 reflecting the sales of Vitality stock that 

had been sold on his behalf, directly or indirectly, by the Veldhuis Control Group.  For example, 

on or about January 13, 2017, the Veldhuis Control Group caused Wintercap SA to sell 44,661 

shares of Vitality, which sales generated proceeds of $105,551.21.  On or about January 27, 

2017, the Veldhuis Control Group caused Wintercap SA to transfer $100,000 to pay an expense 

incurred by Dhillon.  Dhillon failed to file a Form 4 reflecting either of these January 2017 

Vitality stock sales, or any other sales by the Veldhuis Control Group in 2017 or 2018 from 

which he benefitted.  

Dhillon’s False and Misleading Testimony in Furtherance of the Scheme 

147. On or about August 29, 2019, during the investigation leading to the filing of this 

action, Dhillon provided sworn testimony to the Commission staff.  Seeking to conceal his illegal 

conduct, Dhillon falsely denied being the beneficiary of any undisclosed Stevia First/Vitality 

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stock sales, and falsely denied knowing that the Veldhuis Control Group had sold Stevia 

First/Vitality stock.   

148. For example, during the August 2019 testimony, the Commission asked Dhillon if 

he ever received the proceeds of any sales of Stevia First/Vitality stock.  Dhillon falsely replied, 

“I have not.”  In actuality, the Veldhuis Control Group and Taylor had distributed Stevia 

First/Vitality stock trading proceeds to Dhillon, directly and indirectly, through cash payments 

and through payments to third parties on Dhillon’s behalf.   

149. Similarly, during the August 2019 testimony, the Commission asked Dhillon if he 

knew anyone who sold Stevia First/Vitality stock.  Dhillon falsely replied, “I’m not aware.”  In 

actuality, Dhillon knew that the Veldhuis Control Group and Taylor had sold Stevia First/Vitality 

stock, and had shared the resulting proceeds with him. 

SHARP GROUP EXAMPLE TWO: 
ILLEGAL ARCH STOCK SALES INVOLVING DHILLON, THE VELDHUIS 

CONTROL GROUP, AND TAYLOR 
 

150. Beginning in or about 2013, the Veldhuis Control Group schemed with Dhillon, 

Taylor and Kaitz to sell illegally the stock of Arch.   

151. In 2013, Dhillon arranged for a private company he controlled to merge (as a 

reverse merger) into a publicly traded shell company controlled by the Veldhuis Control Group.  

Following the reverse merger, which closed in or about June 2013, the surviving public company 

was called Arch. 

152. By April 2013, Dhillon had become an officer or director of Arch; and by June 

2013, Dhillon had assumed the role of chairman of Arch’s board of directors.   

153. Prior to the 2013 Arch reverse merger, Arch had issued shares to various S-1 

Shareholders (hereinafter referred to as the “Arch S-1 Shareholders”) in 2012.  By early 2013, 

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following a stock split, the Arch S-1 Shareholders collectively held 20 million shares of Arch 

stock (which traded under the ticker symbol “ARTH”).   

154. Leading up to, and shortly after, the closing of the reverse merger, the Veldhuis 

Control Group directed the transfer of 16,920,000 Arch shares, held in the names of several Arch 

S-1 Shareholders, to eleven Sharp Group-administered nomine shareholders for the benefit of the 

Veldhuis Control Group.   

155. Kelln arranged, on behalf of the Veldhuis Control Group, to transfer an additional 

2,310,000 shares, held in the names of several additional Arch S-1 Shareholders, to an entity 

controlled by Wintercap SA called “Victory Capital” on behalf of the Veldhuis Control Group.   

156. Combined, the Veldhuis Control Group held at least 19,230,000 purportedly 

unrestricted shares of Arch, representing over 48% of Arch’s total issued and outstanding stock, 

which constituted close to 100% of Arch’s unrestricted shares that were available for trading, at 

or around the time of the reverse merger.   

157. Shortly before the reverse merger closed, the Veldhuis Control Group controlled, 

through a Sharp Group-administered nominee, an additional 20,000,000 shares that were marked 

as restricted.  In anticipation of the reverse merger, the Veldhuis Control Group transferred these 

shares to Dhillon (10,000,000) and a company controlled by the CEO of Arch (10,000,000).  

Dhillon, in turn, transferred 2,750,000 shares to a domestic corporate entity (“Company A”), an 

entity that was controlled by Dhillon’s associate, Person A.   

158. The chart below illustrates the transfers described in ¶¶ 153 through 157. 

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159. The Veldhuis Control Group provided financing to Arch around the time of the 

reverse merger.  Specifically, the Veldhuis Control Group funneled approximately $1.75 million 

through an attorney’s escrow account, which was remitted to Arch in the form of equity 

subscription agreements.  Dhillon, through his same Swiss-banking Ortivo account referenced in 

¶ 82, also contributed $250,000 as part of this financing, but concealed this involvement from 

Arch’s principals.   

160. Following the reverse merger, the Veldhuis Control Group engaged Kaitz to 

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promote Arch and paid Kaitz approximately $1.2 million from June 2013 to August 2013 for this 

promotion.   

161. As Kaitz knew or recklessly disregarded, these payments were derived from 

money held by Sharp Group-administered nominee shareholders on behalf of the Veldhuis 

Control Group.  For example, on or about July 24, 2013, Kaitz sent the following Encrypted 

Communication to Veldhuis: “Are you able to capture anything on arth?”  Kaitz was asking 

Veldhuis, in substance, how much money, if any, the Veldhuis Control Group made from the 

sale of Arch stock during the course of the stock promotion.   

162. Some of the promotions managed by Kaitz falsely identified the promotions’ 

funding source.  For example, the landing page for an Arch promotion cited “Advantage Media 

Corp” as the “paying party” of a $790,000 “total production budget.”  As Kaitz knew or 

recklessly disregarded, Advantage Media was a front company used to disguise the identity of 

the parties actually paying for the promotion, i.e. the Veldhuis Control Group.   

163. On September 27, 2013, Kaitz asked Veldhuis in an Encrypted Communication 

what to do if other stock promoters hired by Kaitz to distribute touts about Arch refused to 

identify Advantage Media as the supposed paying party.  Kaitz wrote to Veldhuis: “Am trying to 

have them put Advantage media, if they won’t then what?”  Later that day, Kaitz explained that 

the other stock promoters said that “[t]hey will go if they get the invoice signed and sent back to 

them via email from advantage.”  Veldhuis responded and directed Kaitz to send the invoice to 

an email address created for the purpose of making it appear as if Advantage Media Corp. was an 

actual third party: “send to [email protected].”    

164. Sharp substantially assisted the Veldhuis Control Group’s use of Advantage 

Media Corp. to disguise the Veldhuis Control Group’s Arch-related conduct.  For example, on or 

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about January 21, 2014, Sharp asked Veldhuis in an Encrypted Communication whether he 

should continue to pay incorporation fees associated with Advantage Media Corp., and, if so, 

whether he (Sharp) should use Arch stock sale proceeds to make such payments: “Do we pay the 

2014 annual fees for advantage media corp (belize)?  Debit arth?”  Veldhuis responded: “Kill it.”  

By that time, Advantage Media Corp. had served its purpose: the Veldhuis Control Group used it 

as a front company to fund a stock promotional campaign touting Arch stock. 

165. The chart below illustrates the success of the Veldhuis Control Group’s paid 

promotion of Arch between June and September 2013: 

 

166. During the period of the promotional campaign, the Veldhuis Control Group 

surreptitiously sold millions of Arch shares into the market through nominee shareholders 

administered by the Sharp Group.  Specifically, between June 11, 2013 and September 30, 2013, 

the Veldhuis Control Group sold approximately 16.6 million shares of Arch stock through Sharp 

Group-administered nominee shareholders, generating proceeds of at least $11.5 million.  The 

 ‐

 1,000,000

 2,000,000

 3,000,000

 4,000,000

 5,000,000

 6,000,000

 7,000,000

 8,000,000

 9,000,000

 $0.30

 $0.50

 $0.70

 $0.90

 $1.10

 $1.30

 $1.50

D
ai
ly
 V
o
lu
m
e

C
lo
si
n
g 
P
ri
ce

Arch Therapeutics, Inc. ‐ Stock Price and Volume (May 2013 ‐ Sept 2013)

Volume Closing Price

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Veldhuis Control Group sold another approximately 1.4 million shares generating proceeds of 

approximately $574,000 through a nominee shareholder administered by Wintercap SA.   

167. Throughout the period of these unregistered sales, the Veldhuis Control group 

was an affiliate of Arch, by virtue of its control over a significant percentage of Arch’s stock 

and/or because it was acting in concert with Dhillon, the chairman of the company.  Sharp, 

Kelln, Veldhuis, Friesen, and Sexton failed to register their sales of Arch stock described herein 

pursuant to Section 5 of the Securities Act.  In selling these shares, the Veldhuis Control Group, 

through Sharp Group-administered nominee shareholders, surreptitiously sold unregistered 

shares of stock, and schemed to defraud investors by concealing the fact that public company 

affiliates were dumping stock into the markets.   

168. The Veldhuis Control Group coordinated with Dhillon on the stock promotions.  

For example, Sexton had one or more discussions with Dhillon where he discussed sharing the 

promotional materials with Dhillon before they were published, and Sexton reported to Dhillon 

the budget for promotions.  In addition, shortly before the merger closed, Friesen asked Sexton 

and Veldhuis whether Dhillon would “have a set of news releases to begin issuing next week?”, 

to which Sexton responded, “I asked for that yesterday.  He said he would deliver.”  Dhillon 

played this role in order to benefit from the Veldhuis Control Group’s sale of stock, since, as the 

Veldhuis Control Group and Dhillon knew, promotional campaigns tend to be more effective 

when they coincide with news releases by the issuer whose stock is being promoted.   

169. Dhillon directly participated in the Veldhuis Control Group’s sales of Arch, while 

failing to register those sales pursuant to Section 5 of the Securities Act.  For example, on or 

about August 13, 2013 in an Encrypted Communication, Sexton relayed a conversation he had 

with Dhillon to Veldhuis: Sexton reported that he told Dhillon that the Veldhuis Control Group 

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“would be active in the market” until the first week of September and that they “wouldn’t sell 

below $0.40 [per share].”  Sexton also relayed to Dhillon that the Veldhuis Control Group would 

first distribute the proceeds of such sales as a repayment for the private placements they had 

made (including Dhillon’s anonymous $250,000 investment) into Arch, but that a broader 

distribution would take place in September.  Sexton noted Dhillon was “disappointed it wasn't 

bigger success as we all are but I explained sometimes things out of control and we were 

squeezing this out in short timeframe so it may have hurt us a bit in that we weren't able to stop 

once we started.”  Sexton continued, “I said we worked well together and everyone did what they 

said they would and that we would continue to look at his projects in future.” 

170. On or about September 6, 2013, Veldhuis instructed Gasarch to wire $250,000 

from the Arch proceeds to the same Dhillon owned Swiss-banking Ortivo account referenced in 

¶¶ 82 and 159, thereby reimbursing Dhillon for his undocumented private placement investment.  

Consistent with Sexton’s description above, the Veldhuis Control Group caused a further 

distribution to be made from the Group’s illicit Arch stock sale proceeds for Dhillon’s benefit in 

September 2013.  

171. In particular, on or about September 26, 2013, Wintercap SA wired $200,000 to a 

Canadian company controlled by Dhillon’s tax accountant, who, in turn, wired the very same 

amount, on or about the same day, to a U.S.-based corporate account that Dhillon controlled.  

This money was derived from the sale of Arch stock.   

172. Taylor also schemed with the Veldhuis Control Group on the Arch deal and 

received at least $600,000 of the proceeds generated by its Arch sales, while also failing to 

register those sales pursuant to Section 5 of the Securities Act.  On or about August 20, 2013, 

Sexton wrote to Veldhuis and instructed him to “send 600k from ARTH” to the same Taylor-

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controlled Swiss bank account as that referenced in ¶ 82.  Two days later, at Veldhuis’s 

direction, Gasarch wired the funds, to that same destination, from a Cayman Islands brokerage 

account.  This $600,000 distribution derived from the illegal sales of Arch stock.  

173. The Sharp Group allocated Arch stock sale proceeds to the Veldhuis Control 

Group as follows during the period of time subject to this Complaint: 

Veldhuis Control Group Member Approximate Amount (Millions) 
Sexton $1.7 
Veldhuis $1.5 
Friesen $1.5 

 

*** 

174. The table below reflects payments directed by the Veldhuis Control Group to 

Dhillon and Taylor or entities with whom they were associated, sourced from the sale of Stevia 

First/Vitality and Arch stock through Sharp Group-administered nominee shareholders from 

2012 to 2018:7 

 

175. As described in ¶ 171, Dhillon was also the beneficiary of another $200,000 in 

Arch stock sale proceeds in 2013, at the Veldhuis Control Group’s direction, but these funds 

were sourced from a Wintercap SA-administered, rather than a Sharp Group-administered, 

                                                            
7 The table does not include payments made in cash to Dhillon or Taylor’s payments to Dhillon.   

Year Dhillon Taylor Total
2012 33,890$            4,225,531$        4,259,421$        
2013 259,770            600,200            859,970            
2014 10,000              124,200            134,200            
2015 25,030              25,030              
2016 231,672            231,672            
2017 2,157,330         2,157,330         
2018 300,500            300,500            

Total 3,018,192$     4,949,931$     7,968,123$     

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nominee shareholder.   

*** 

176. During the period of April 2014 through March 2016, the table below reflects 

various distributions of money, some of which were derived from Stevia First/Vitality and Arch 

stock sale proceeds, directed by Taylor to third parties for the benefit of Dhillon or otherwise 

associated with Dhillon: 

 

*** 
 

177. On or about July 30, 2020, Dhillon appeared for further testimony before the 

Commission in connection with the investigation leading to the filing of this action, and again 

made false and misleading statements, including claims that (i) prior to 2014, his interactions 

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with Sexton had been limited to seeing him from a distance “in social circles … [like] hockey 

games”, “at charity events with his own tables [and] at restaurants entertaining people” and that 

(ii) since 2014, his substantive interactions with Sexton have been limited to several discrete 

topics that he characterized as innocent in nature.   

*** 

178. In addition to their schemes to sell Arch and Vitality stock illegally that are 

described above, Taylor and Dhillon also schemed to sell the stock of at least two other Dhillon-

chaired issuers:  Inovio and OncoSec.  Taylor’s and Dhillon’s Inovio scheme is described in the 

following paragraph; the pair’s OncoSec scheme is described at ¶¶ 218 and 219. 

179. At the time of Taylor’s and Dhillon’s Inovio scheme, Dhillon was the chairman of 

Inovio’s Board of Directors.  Similarly to Taylor and Dhillon’s other schemes, Dhillon facilitated 

the transfer of Inovio shares to a nominee company controlled by Taylor, who then directed the 

unregistered sale of those shares from at least approximately August 23, 2013 to September 13, 

2013.  Taylor’s sales generated at least $2.5 million in proceeds.  On various dates during 

approximately November 2013 through January 2014, Taylor paid hundreds of thousands of 

dollars to Dhillon or for Dhillon’s benefit.  Also, similarly to Taylor and Dhillon’s other 

schemes, Dhillon failed to register the Inovio shares or report his beneficial ownership interest in 

them or sale of them on either Schedule 13D or Form 4. 

DHILLON’S SCHEME TO SELL ARCH STOCK ILLEGALLY THROUGH PERSON A 
 

180. Dhillon illegally sold the stock of companies atop whose boards he sat through 

different channels, apart from the Veldhuis Control Group and Taylor.  To that end, Dhillon 

enlisted Person A to establish and manage a front company through which Dhillon  

surreptitiously sold such stock, without Dhillon appearing associated with those stock sales in 

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any public record or filing.  Dhillon’s scheme to sell Arch stock illegally with Person A is 

described in detail below.   

181. Dhillon schemed to sell the stock of Arch fraudulently by, among other things, 

concealing from securities intermediaries such as brokers that he was selling, through a nominee 

shareholder, stock that was legally required to be registered, and concealing from Arch’s 

shareholders that he—Arch’s highest-level insider—was selling Arch stock into the market.   

182.  In or about April 2013, Dhillon became a director of Arch, and, by June of that 

year, became chairman of its board.  Dhillon was an affiliate of Arch in that he had the power to 

control the company through his role as its chairman.  As a public company affiliate, Dhillon was 

legally required to register any sale of Arch stock unless Dhillon elected to comply with the safe 

harbor provisions set forth in Commission Rule 144, which strictly limit the quantity of 

securities an affiliate may sell to the public.  Dhillon testified, under oath, during the 

Commission’s investigation that he understood these legal requirements at all times relevant to 

this Complaint.  

183. As a director of Arch, Dhillon was required to file public reports—including a 

Form 4—with the Commission pursuant to Section 16(a) of the Exchange Act and Rule 16a-3 

thereunder disclosing any change in his beneficial ownership of Arch stock, regardless of 

amount.  Dhillon understood these legal requirements at all times relevant to this Complaint.  

Dhillon failed to file any Forms 4 reflecting sales of Arch stock by the Veldhuis Control Group 

(described above) or Person A from which he benefitted.   

184. Dhillon was legally required to file a Schedule 13D with the Commission 

pursuant to Section 13(d) of the Exchange Act and Rule 13d-1 thereunder to the extent he was 

the beneficial owner of greater than five percent of Arch’s common stock.  Dhillon understood 

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these legal requirements at all times relevant to this Complaint.  Dhillon failed to file an accurate 

Schedule 13D reflecting his beneficial ownership of Arch’s stock. 

185. Shortly after Dhillon became the chairman of Arch’s board in April 2013, he 

arranged for at least one alter ego corporate shareholder to hold Arch stock on his behalf.  

Specifically, in or about June 2013, Dhillon arranged for the transfer of 2,750,000 Arch shares to 

Company A, a corporate nominee that Dhillon directed Person A to form.  In order to disguise 

Dhillon’s association with Company A, Person A, as directed by Dhillon, identified only Person 

A as Company A’s director in its incorporation papers.  Company A was, in actuality, holding 

Arch stock for Dhillon.   

186. On or about April 6, 2016, Person A caused Company A to open an account with 

a United States brokerage firm for the purpose of selling Arch stock.  Person A represented to the 

United States brokerage firm that he (as the sole director of Company A), was not an “officer, 

director, or more than a 10% shareholder of [Arch] or in any other way an ‘affiliate’ of [Arch].”  

Person A’s representation was false and misleading in that Company A was actually holding, and 

was created in order to sell, Arch stock on behalf of Dhillon, who was a director and affiliate of 

Arch.  Dhillon knew, or recklessly disregarded, that Person A misled the United States brokerage 

firm as part of their scheme to sell Arch stock surreptitiously. 

187. The table below reflects Company A’s sales of Arch stock, all of which occurred 

during a four-month period in 2016.  Dhillon failed to register these sales pursuant to Section 5 

of the Securities Act:  

 

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188. At or about the same time that Company A sold Arch stock, Person A caused 

Company A to transfer at least $850,000 of Arch stock sale proceeds to third parties identified by 

Dhillon, his assistant, or both, all to benefit Dhillon.  These transfers included paying various 

business and personal expenses Dhillon had incurred.   

189. Examples of Arch proceeds-funded payments routed by Company A through 

Dhillon’s assistant to a bank account controlled by Dhillon in the name of One World Ranches 

LLC, as directed by Dhillon, are below. 

 

190. Dhillon did not disclose the stock that Company A held on Dhillon’s behalf, or 

Dhillon’s agreements with Person A concerning the holding and sale of those shares, on a 

Schedule 13D, as legally required.  Nor did Dhillon disclose any of Company A’s Arch sales 

executed on Dhillon’s behalf on any Form 4 filing with the Commission. 

191. On or about July 8, 2013, Dhillon filed a Schedule 13D with the Commission 

purportedly reflecting all of the Arch shares in which he held a beneficial interest.  This is the 

only Schedule 13D Dhillon filed concerning Arch.  Dhillon reported that he was the beneficial 

owner of 7,160,373 of Arch shares, consisting of:  

a. 7,000,000 shares that he received in a private transaction in or about June 

2013. 

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b. 160,373 shares of common stock in exchange for the cancellation of debt 

Dhillon was owed by a private company that had merged with Arch. 

192. Dhillon’s July 8, 2013 Schedule 13D was materially misleading in that it failed to 

reflect that Dhillon was also a beneficial owner of Arch stock held on Dhillon’s behalf by 

Company A and additional Arch stock held on Dhillon’s behalf by the Veldhuis Control Group.  

The Schedule 13D was also materially misleading in that it failed to disclose Dhillon’s 

agreements with Person A and with the Veldhuis Control Group concerning the sale of Arch 

shares, or his and their respective combined holdings in Arch securities.  Dhillon knowingly 

failed to make any of these disclosures in his Schedule 13D in order to conceal that information 

from investors and securities market intermediaries. 

193. Dhillon also knowingly failed to file any Forms 4 reflecting the sales of Arch 

stock that had been effected on his behalf, directly or indirectly, by Company A or the Veldhuis 

Control Group.  For example, on various dates in April through June 2016, Company A sold 

Arch shares in the market on Dhillon’s behalf.  Dhillon intentionally failed to file a Form 4 

reflecting any of these 2016 Arch stock sales in order to conceal his conduct form Arch 

investors.    

194. On or about August 29, 2019, during the investigation leading to the filing of this 

action, Dhillon provided sworn testimony to the Commission staff.   

195. During that August 2019 testimony, the Commission asked Dhillon if he knew of 

anyone who sold Arch stock prior to 2019.  Dhillon, seeking to conceal his illegal conduct from 

the Commission, falsely replied, under oath: “I’m not aware.”  In actuality, and as Dhillon well 

knew, Person A caused Company A to sell Arch shares on Dhillon’s behalf.  As described above, 

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and as Dhillon likewise well knew, the Veldhuis Control Group also sold Arch shares on 

Dhillon’s behalf. 

 

SHARP GROUP EXAMPLE THREE: 
ILLEGAL ONCOSEC STOCK SALES INVOLVING DHILLON AND THE VELDHUIS 

CONTROL GROUP 
 

The Veldhuis Control Group’s Scheme to Sell OncoSec Stock Fraudulently 
 

196. Prior to the Stevia First/Vitality and Arch fraudulent conduct described above, the 

Veldhuis Control Group schemed with the Sharp Group and Dhillon to sell fraudulently the stock 

of another issuer, OncoSec.  Further, Sharp, Kelln, Veldhuis, Friesen, Sexton, and Dhillon failed 

to register the sales of OncoSec stock described herein pursuant to Section 5 of the Securities 

Act. 

197. In or about February 2011, the Veldhuis Control Group directed the transfer to 

seven Sharp Group-administered nominee shareholders of 12,800,000 purportedly unrestricted 

OncoSec shares sourced from 20 original individual investors.  At the time, OncoSec had 

52,656,000 shares outstanding.  The Veldhuis Control Group, therefore, held over 24% of the 

total common stock outstanding across the Sharp Group-provided nominee shareholders to 

which the Veldhuis Control Group directed OncoSec shares, and was an affiliate of the issuer.  

The Veldhuis Control Group knew that its 24% stake in OncoSec was legally restricted from 

resale absent an effective registration statement.  The table below reflects the transfers 

summarized in this paragraph.8 

                                                            
8 Monterra Investments, Cliffside Partners, and Dartmore International are nominee shareholders utilized by the 
Veldhuis Control Group. 

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198. Between approximately March 2011 and November 2011, the Veldhuis Control 

Group sold, via various Sharp Group-administered nominee shareholders, approximately 2.2 

million shares of OncoSec stock through offshore brokerage firms for proceeds of approximately 

$3 million.   

199. Later, the Veldhuis Control Group sold through the Sharp Group approximately 

11 million more OncoSec shares between approximately February 2012 and August 2012 for 

approximately $2.4 million more in illicit proceeds. 

Dhillon’s Scheme to Sell OncoSec Fraudulently through Person A 
 

200. Around the same time that the Veldhuis Control Group sold OncoSec securities, 

Dhillon schemed to sell the stock of OncoSec fraudulently through Person A.  Dhillon concealed 

from securities intermediaries, such as brokers, that he was selling, through a nominee 

shareholder, stock that was legally required to be restricted, and concealed from OncoSec’s 

investors that he was selling OncoSec stock into the market.   

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201. On or about March 10, 2011, Dhillon became the chairman of OncoSec’s board of 

directors.   

202. Dhillon was an affiliate of OncoSec because he was the chairman of its board.  

Through that role, he had the power to control the company.  As a public company affiliate, 

Dhillon was legally required to register any sale of OncoSec stock unless Dhillon elected to 

comply with the safe harbor provisions set forth in Commission Rule 144.  Dhillon testified, 

under oath, during the Commission’s investigation that he understood these legal requirements at 

all times relevant to this Complaint.   

203. As a director of OncoSec, Dhillon was required to file public reports—including a 

Form 4—with the Commission pursuant to Section 16(a) of the Exchange Act and Rule 16a-3 

thereunder disclosing any change in his beneficial ownership of OncoSec stock, regardless of 

amount.  Dhillon understood these legal requirements at all times relevant to this Complaint.   

204. Dhillon was legally required to file a Schedule 13D with the Commission 

pursuant to Section 13(d) of the Exchange Act and Rule 13d-1 thereunder to the extent he was 

the beneficial owner of greater than five percent of OncoSec’s common stock.  On or about 

March 22, 2011, Dhillon received 9,910,496 restricted shares of OncoSec, which comprised 

greater than 5% of the company’s outstanding stock.   

205. Dhillon understood these legal requirements at all times relevant to this 

Complaint.  Dhillon intentionally failed to file an accurate Schedule 13D reflecting his beneficial 

ownership of OncoSec’s stock, his agreement with Person A concerning the sale of OncoSec 

stock, or his and Person A’s combined holdings in OncoSec, despite being the beneficial owner 

of greater than five percent of the company’s outstanding common stock. 

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206. Around the time that Dhillon became the chairman of OncoSec’s board in March 

2011, he arranged for Person A to hold OncoSec stock on his behalf through a nominee 

shareholder.    

207. On or about March 2, 2011, Person A incorporated a corporate entity at Dhillon’s 

direction, hereinafter referred to as Company B, to serve as Dhillon’s nominee shareholder.  

Shortly thereafter, Dhillon facilitated Company B’s nominal acquisition of 2,354,880 OncoSec 

shares.  At Dhillon’s direction, Person A identified himself as Company B’s sole director, in 

order to conceal Dhillon’s association with Company B.   

208. By December 2012, Person A opened a brokerage account in the name of 

Company B.  

209. On or about January 19, 2013, Person A represented to Company B’s brokerage 

firm that Company B was never an “Officer, Director, Control Person, 10% owner or Affiliate of 

the issuer being presented for deposit [i.e., OncoSec],” which was a confirmation required by the 

brokerage firm when the OncoSec shares were deposited for resale.   

210. Person A’s representations to the brokerage firm were false and misleading 

because Company B was, in actuality, holding shares for Dhillon, who was a Director, Control 

Person, and Affiliate of OncoSec.  Dhillon knew, or was reckless in not knowing, that Person A 

would make these types of material misrepresentations to brokerage firms.  Indeed, Dhillon 

directed Person A to establish Company B for precisely this purpose: to conceal the fact that 

Dhillon was actually the beneficial owner of Company B’s OncoSec stock. 

211. In or about January 2013, Person A caused Company B to deposit 2,354,880 

shares of OncoSec into its brokerage account.  Person A, working in concert with Dhillon, 

subsequently caused Company B to sell these shares on Dhillon’s behalf.   

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212. The table below reflects Company B’s sales of all 2,354,880 of its shares of 

OncoSec stock, between 2013 and 2017.  Dhillon failed to register these stock sales pursuant to 

Section 5 of the Securities Act. 

 

213. Person A, acting through Company B, distributed the majority of the OncoSec 

sale proceeds at Dhillon’s direction to third parties identified by Dhillon.  Dhillon directed the 

transfers to third parties, instead of directly to his own bank accounts, to conceal that he was the 

actual beneficiary of the stock sales.   

214. The flow chart below reflects examples of Company B’s OncoSec proceeds-

funded transfers to Dhillon’s assistant for the benefit of Dhillon, as directed by Dhillon: 

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215. To conceal his conduct from investors, Dhillon never filed a Schedule 13D with 

the SEC disclosing his agreement with Person A concerning the sale of OncoSec stock through 

Company B, or his and Person A’s combined holdings in OncoSec stock, or any of the many 

material changes to those combined holdings. 

216. Dhillon knew that OncoSec’s public filings concealed from OncoSec’s 

shareholders and securities market intermediaries the true extent of Dhillon’s beneficial 

ownership position.  For example, OncoSec’s Form 10-K for the year ended July 31, 2011 only 

reported Dhillon’s ownership of 9,910,496 shares, and failed to disclose Dhillon’s further 

beneficial ownership of, at a minimum, the Company B shares.  As a further example, 

OncoSec’s Form 10-K for the year ended July 31, 2017 failed to disclose the existence or extent 

of Dhillon’s Form 4 filing delinquencies stemming from his failure to file any Forms 4 

concerning his OncoSec share sales that year through Company B. 

217. Indeed, to conceal his conduct from investors, Dhillon never filed any Forms 4 

reporting Company B’s sales of OncoSec stock on his behalf, as legally required. 

DHILLON’S SCHEME TO SELL ONCOSEC STOCK ILLEGALLY VIA TAYLOR 
 

218. During the course of his scheme with Person A to sell illegally OncoSec stock, 

described above, Dhillon also schemed with Taylor to sell illegally even more OncoSec stock.  

At the time of this Dhillon-Taylor OncoSec scheme, Dhillon was the chairman of OncoSec’s 

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Board of Directors.  As part of this scheme, between at least April 2 and June 19, 2014, Taylor 

sold at least 827,000 shares of OncoSec stock, through a Singapore-banking nominee 

shareholder that he controlled, for proceeds totaling approximately $586,000.  Taylor failed to 

register these stock sales pursuant to Section 5 of the Securities Act.   

219. During that same period, and from the same account in which he had realized the 

aforementioned approximately $586,000 in sale proceeds, Taylor, in turn, sent out two wires 

totaling $155,000 for Dhillon’s benefit.  For examples, Taylor wired approximately $95,000 to 

pay a creditor Dhillon owed, and $60,000 to a private company Dhillon owned.  And, as with his 

other, similar schemes, Dhillon never disclosed—through any Form 4 or any other filing—his 

OncoSec trading through Taylor. 

*** 

ADDITIONAL SHARP GROUP AND VELDHUIS CONTROL GROUP DEALS 

220. The Veldhuis Control Group utilized the Sharp Group’s services to disguise their 

stock sales in deals beyond the Vitality, Arch, and OncoSec conduct detailed above.  In each 

such case, the Sharp Group provided the infrastructure necessary to obfuscate the Veldhuis 

Control Group’s ownership of a significant percentage of the public companies’ shares.  The 

table below reflects a non-exhaustive list of stock sold by the Veldhuis Control Group using 

Sharp Group-administered nominee shareholders to disguise their control.   

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221. The Veldhuis Control Group paid Kaitz to promote several of the issuers listed in 

the table in ¶ 220, including (in addition to Stevia First/Vitality and Arch, both detailed above) 

the stock of Echo Automotive, Liberty One Lithium Corp., Oryon Technologies, Inc., NewGen 

Biopharma Corp., StartMonday Technology Corp., and BreathTech Biomedical, Inc.   

222. In each instance, Kaitz knowingly or recklessly substantially assisted the Veldhuis 

Control Group by materially omitting or materially misrepresenting the facts that the Veldhuis 

Control Group (i) actually paid for the stock promotional campaign, and (ii) was actively trading, 

and planned to trade, in the very opposite direction to which the promotions urged investors to 

trade.   

SHARP GROUP EXAMPLE: LUIS CARRILLO 
 

223. As described in ¶ 43, above, the control group clients of the Sharp Group 

generated over one billion dollars in stock sales through the Sharp Group between approximately 

2010 and 2019.  One such client is a repeat offender, Luis Carrillo.9  Carrillo generated, in 

concert with others, at least $75 million in illegal stock sale proceeds using the Sharp Group’s 

encrypted communications and nominee shareholders as cover.  One such example is described 

below. 

                                                            
9 See SEC v. Carrillo et al., 13-cv-1735-GBD (S.D.N.Y. March 2013).   

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224. On August 4, 2021, the Commission filed a Complaint against Luis Carrillo in 

connection with his illegal sale of the stock of Garmatex Holdings, Ltd.  Carrillo, acting in 

concert with others, amassed approximately 88% of Garmatex’s unrestricted shares that were 

available for trading, and they used the Sharp Group, Wintercap SA, Blacklight SA, and a 

separate broker to execute the scheme.  

225. In particular, Kelln, at Sharp’s direction, deposited three blocks of Garmatex 

stock—each consisting of 1,750,000 Garmatex shares, or just under five percent of Garmatex’s 

total outstanding stock—with Wintercap SA in the name of three Sharp Group nominee 

shareholders.  As Sharp and Kelln knew, or recklessly disregarded, brokerage firms typically 

inquire about whether a shareholder owns more than five percent of a public company’s stock 

because holding more than five percent may trigger additional questions about whether the sales 

are part of a distribution that must be registered pursuant to Section 5 of the Securities Act.   

226. Sharp and Kelln arranged for these deposits in the names of separate Sharp Group 

nominee shareholders well knowing that Carrillo and his team were actually the beneficial 

owners of the shares. For example, on or about March 9, 2017, Kelln replied to an Encrypted 

Communication from Wintercap SA’s principal about the status of selling Garmatex stock: 

“Changing the [transfer agent] first . . . [Carrillo is] up my butt to get grmx [the ticker of 

Garmatex] all in.”   

227. The Sharp Group’s provision of these nominee shareholders enabled Carrillo, 

acting in concert with others, to conceal from brokerage firms that they actually controlled 

greater than five percent of the company’s outstanding shares. 

228. Overall, during approximately March and April 2017, Kelln coordinated with 

Carrillo, acting in concert with others, to transfer a total of 12,233,337 shares of Garmatex 

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nominally held by six different Sharp Group-administered nominee shareholders to Wintercap 

SA, Blacklight SA, and a third party.  Collectively, these positions accounted for approximately 

88% of Garmatex’s purportedly unrestricted shares that were available for trading, and 

approximately 34% of Garmatex’s total issued and outstanding stock.  Carrillo, therefore, was an 

affiliate of Garmatex.  

229. The chart below summarizes the Garmatex share transfers described above: 

 

230. Carrillo, acting in concert with others, coordinated the trading of Garmatex stock 

at Wintercap SA, Blacklight SA and a separate broker during a stock promotional campaign, 

generating proceeds as a result of these unregistered sales in excess of $7 million. 

TOLLING AGREEMENTS 

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231. Between January and June 2020, Dhillon entered into two separate tolling 

agreements with the Commission.  Each tolling agreement specifies a period of time (a “tolling 

period”) in which “the running of any statute of limitations applicable to any action or 

proceeding against Dhillon authorized, instituted, or brought by … the Commission… arising out 

of the [Commission’s investigation of Dhillon’s conduct], including any sanctions or relief that 

may be imposed therein, is tolled and suspended . . . .”  Each tolling agreement further provides 

that Dhillon “shall not include the tolling period in the calculation of the running of any statute 

of limitations or for any other time-related defense applicable to any proceeding, including any 

sanctions or relief that may be imposed therein, in asserting or relying upon any such time-

related defenses.”  Collectively, these agreements tolled the running of any limitations period or 

any other time-related defenses available to Dhillon for a period of approximately seven months 

and three days.   

FIRST CLAIM FOR RELIEF 
FRAUD IN THE OFFER OR SALE OF SECURITIES 

(Violations of Sections 17(a)(1) and (3) of the Securities Act by Sharp, Kelln, Veldhuis, 
Sexton, Friesen, Dhillon, and Taylor) 

 
232. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if 

fully set forth herein. 

233. During the Relevant Period, the stock of Vitality, Arch, and OncoSec was each a 

security under Section 2(a)(1) of the Securities Act [15 U.S.C. §77b(a)(1)], and a penny stock. 

234. By reason of the conduct described above, defendants Sharp, Kelln, Veldhuis, 

Sexton, Friesen, Dhillon, and Taylor, in connection with the offer or sale of securities, by the use 

of the means or instrumentalities of interstate commerce or of the mails, directly or indirectly, 

acting intentionally, knowingly, recklessly or negligently (i) employed devices, schemes, or 

artifices to defraud; and (ii) engaged in transactions, practices, or courses of business which 

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operated or would operate as a fraud or deceit upon any persons, including purchasers or sellers 

of the securities.   

235. By reason of the conduct described above, defendants Sharp, Kelln, Veldhuis, 

Sexton, Friesen, Dhillon, and Taylor violated Securities Act Sections 17(a)(1) and (3) [15 U.S.C. 

§77q(a)(1) and (3)] and will continue to violate those sections unless enjoined. 

SECOND CLAIM FOR RELIEF 
FRAUD IN CONNECTION WITH THE PURCHASE OR SALE OF SECURITIES 

(Violations of Section 10(b) of the Exchange Act and Rules 10b-5(a) and (c) by Sharp, 
Kelln, Veldhuis, Sexton, Friesen, Dhillon, and Taylor) 

 
236. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if 

fully set forth herein. 

237. During the Relevant Period, the stock of Vitality, Arch, and OncoSec was each a 

security under Section 2(a)(1) of the Securities Act [15 U.S.C. §77b(a)(1)], and a penny stock. 

238. By reason of the conduct described above, defendants Sharp, Kelln, Veldhuis, 

Sexton, Friesen, Dhillon, and Taylor, directly or indirectly, in connection with the purchase or 

sale of securities, by the use of the means or instrumentalities of interstate commerce or of the 

mails, or of any facility of any national securities exchange, intentionally, knowingly or 

recklessly, (i) employed devices, schemes, or artifices to defraud; and (ii) engaged in acts, 

practices, or courses of business which operated or would operate as a fraud or deceit upon any 

persons, including purchasers or sellers of the securities. 

239. By reason of the conduct described above, defendants Sharp, Kelln, Veldhuis, 

Sexton, Friesen, Dhillon, and Taylor violated Exchange Act Section 10(b) [15 U.S.C. §78j(b)] 

and Rules 10b-5(a) and (c) [17 C.F.R. §240.10b-5(a) and (c)] thereunder. 

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THIRD CLAIM FOR RELIEF 
UNREGISTERED OFFERINGS OF SECURITIES 

(Violations of Sections 5(a) and 5(c) of the Securities Act by Sharp, Kelln, Veldhuis, 
Friesen, Sexton, and Dhillon) 

 
240. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if 

fully set forth herein. 

241. During the Relevant Period, the stock of Vitality, Arch, and OncoSec was each a 

security under Section 2(a)(1) of the Securities Act [15 U.S.C. §77b(a)(1)], and a penny stock. 

242. By reason of the conduct described above, defendants Sharp, Kelln, Veldhuis, 

Friesen, Sexton, and Dhillon, directly or indirectly:  (a) made use of the means or instruments of 

transportation or communication in interstate commerce or of the mails to sell, through the use or 

medium of a prospectus or otherwise, securities as to which no registration statement has been in 

effect and for which no exemption from registration has been available; and/or (b) made use of 

the means or instruments of transportation or communication in interstate commerce or of the 

mails to offer to sell, through the use or medium of a prospectus or otherwise, securities as to 

which no registration statement has been filed and for which no exemption from registration has 

been available. 

243. As a result, Sharp, Kelln, Veldhuis, Friesen, Sexton, and Dhillon violated 

Sections 5(a) and (c) of the Securities Act [15 U.S.C. §§77e(a), (c)].  

FOURTH CLAIM FOR RELIEF 
FAILURE TO REPORT OVER 5% BENEFICIAL OWNERSHIP 

(Violations of Section 13(d) of the Exchange Act and Rule 13d-1 Thereunder by Veldhuis, 
Sexton, and Friesen) 

 
244. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if 

fully set forth herein. 

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245. During the Relevant Period, the stock of Vitality was a security under Section 

3(a)(1) of the Exchange Act [15 U.S.C. §78c(a)(10)], and a penny stock. 

246. During the Relevant Period, Vitality had equity securities that were registered 

pursuant to Section 12 of the Exchange Act [15 U.S.C. §78l]. 

247. By reason of the conduct described above, defendants Veldhuis, Sexton, and 

Friesen, after acquiring directly or indirectly beneficial ownership of more than 5 percent of a 

class of Vitality equity securities, failed to file a statement with the Commission containing the 

information required by Schedule 13D [17 C.F.R. §240.13d-101] within ten days after they 

acquired such shares, or at all. 

248. As a result, defendants Veldhuis, Sexton, and Friesen violated Section 13(d) of 

the Exchange Act and Rule 13d-1 thereunder [15 U.S.C. §78m(d); 17 C.F.R. §240.13d-1].  

FIFTH CLAIM FOR RELIEF 
FAILURE TO REPORT OVER 5% BENEFICIAL OWNERSHIP 

(Violation of Section 13(d) of the Exchange Act and Rule 13d-2 Thereunder by Dhillon) 
 

249. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if 

fully set forth herein. 

250. During the Relevant Period, the stock of Vitality was a security under Section 

3(a)(1) of the Exchange Act [15 U.S.C. §78c(a)(10)], and a penny stock. 

251. During the Relevant Period, Vitality had equity securities that were registered 

pursuant to Section 12 of the Exchange Act [15 U.S.C. §78l]. 

252. By reason of the conduct described above, defendant Dhillon, after acquiring 

directly or indirectly beneficial ownership of more than 5 percent of a class of Vitality equity 

securities and filing a Schedule 13D, acquired beneficial ownership of 1 percent or more of that 

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class of equity securities and failed to file with the Commission a timely and accurate 

amendment disclosing this material change. 

253. As a result, defendant Dhillon violated Section 13(d) of the Exchange Act and 

Rule 13d-2 thereunder [15 U.S.C. §78m(d); 17 C.F.R. §240.13d-2].  

SIXTH CLAIM FOR RELIEF 
FAILURE TO FILE  

(Violation of Section 16(a) of the Exchange Act and Rule 16a-3 Thereunder by Dhillon) 
 

254. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if 

fully set forth herein. 

255. During the Relevant Period, the stock of Arch and OncoSec was each a security 

under Section 3(a)(1) of the Exchange Act [15 U.S.C. §78c(a)(10)], and a penny stock. 

256. During the Relevant Period, Arch and OncoSec had equity securities that were 

registered pursuant to Section 12 of the Exchange Act [15 U.S.C. §78l]. 

257. Defendant Dhillon violated Section 16(a) of the Exchange Act [15 U.S.C. § 

78p(a)], and Rule 16a-3 thereunder [17 C.F.R. § 240.16(a)], in that as a director of Arch and 

OncoSec and having acquired more than 10% of a registered class of Arch’s and OncoSec’s 

equity securities, Dhillon failed to file reports of ownership and changes of ownership with the 

Commission as required.  

SEVENTH CLAIM FOR RELIEF 
AIDING AND ABETTING 

(Violations of Section 15(b) of the Securities Act by Taylor) 
 

258. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if 

fully set forth herein. 

259. By reason of the conduct described above, Dhillon, directly or indirectly:  

(a) made use of the means or instruments of transportation or communication in interstate 

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commerce or of the mails to sell, through the use or medium of a prospectus or otherwise, 

securities as to which no registration statement has been in effect and for which no exemption 

from registration has been available; and/or (b) made use of the means or instruments of 

transportation or communication in interstate commerce or of the mails to offer to sell, through 

the use or medium of a prospectus or otherwise, securities, including, but not limited to, the 

securities of Vitality, as to which no registration statement has been filed and for which no 

exemption from registration has been available. 

260. Taylor knowingly or recklessly provided substantial assistance to Dhillon in his 

violation of Sections 5(a) and 5(c) of the Securities Act.   

261. As a result, Taylor violated Section 15(b) the Securities Act [15 U.S.C. §§ 

77o(b)].  

EIGHTH CLAIM FOR RELIEF 
AIDING AND ABETTING 

(Violations of Section 15(b) of the Securities Act by Sharp and Kelln) 
 

262. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if 

fully set forth herein. 

263. By reason of the conduct described above, Veldhuis, Sexton, Friesen, Carrillo, 

and other Sharp Group clients, directly or indirectly, in the offer or sale of securities, by the use 

of the means or instrumentalities of interstate commerce or of the mails, or of any facility of any 

national securities exchange, intentionally, knowingly or recklessly, (i) employed devices, 

schemes, or artifices to defraud; and (ii) engaged in transactions, practices, or courses of business 

which operated or would operate as a fraud or deceit upon any persons, including purchasers or 

sellers of the securities.   

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264. By reason of the conduct described above, Veldhuis, Sexton, Friesen, Carrillo, 

and other Sharp Group clients, directly or indirectly:  (a) made use of the means or instruments 

of transportation or communication in interstate commerce or of the mails to sell, through the use 

or medium of a prospectus or otherwise, securities as to which no registration statement has been 

in effect and for which no exemption from registration has been available; and/or (b) made use of 

the means or instruments of transportation or communication in interstate commerce or of the 

mails to offer to sell, through the use or medium of a prospectus or otherwise, securities, 

including, but not limited to, the securities of Vitality, Arch, OncoSec, and Garmatex, as to 

which no registration statement has been filed and for which no exemption from registration has 

been available. 

265. Sharp and Kelln knowingly or recklessly provided substantial assistance to 

Veldhuis, Sexton, Friesen, Carrillo, and other Sharp Group clients in their violations of Sections 

5(a), 5(c), and 17(a)(1) and (3) of the Securities Act.   

266. As a result, Sharp and Kelln each violated Section 15(b) of the Securities Act 

[15 U.S.C. §§ 77o(b)].  

NINTH CLAIM FOR RELIEF 
AIDING AND ABETTING 

(Violations of Section 20(e) of the Exchange Act by Sharp and Kelln) 
 

267. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if 

fully set forth herein. 

268. By reason of the conduct described above, Veldhuis, Sexton, Friesen, Carrillo, 

and other Sharp Group clients, directly or indirectly, in connection with the purchase or sale of 

securities, by the use of the means or instrumentalities of interstate commerce or of the mails, or 

of any facility of any national securities exchange, intentionally, knowingly or recklessly, (i) 

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employed devices, schemes, or artifices to defraud; and (ii) engaged in acts, practices, or courses 

of business which operated or would operate as a fraud or deceit upon any persons, including 

purchasers or sellers of the securities. 

269. Sharp and Kelln knowingly or recklessly provided substantial assistance to 

Veldhuis, Sexton, Friesen, Carrillo, and other Sharp Group clients in their violations of Section 

10(b) of the Exchange Act and Rules 10b-5(a) and (c) thereunder.   

270. As a result, Sharp and Kelln each violated Section 20(e) the Exchange Act 

[15 U.S.C. § 78t(e)].  

TENTH CLAIM FOR RELIEF 
FRAUD IN THE OFFER OR SALE OF SECURITIES 

(Violations of Section 17(a)(3) of the Securities Act by Gasarch) 
 

271. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if 

fully set forth herein. 

272. During the Relevant Period, the stock of Vitality, Arch, OncoSec, and Garmatex 

was each a security under Section 2(a)(1) of the Securities Act [15 U.S.C. §77b(a)(1)]. 

273. By reason of the conduct described above, defendant Gasarch, in connection with 

the offer or sale of securities, by the use of the means or instrumentalities of interstate commerce 

or of the mails, directly or indirectly, acting intentionally, knowingly, recklessly or negligently 

engaged in transactions, practices, or courses of business which operated or would operate as a 

fraud or deceit upon any persons, including purchasers or sellers of the securities.   

274. By reason of the conduct described above, defendant Gasarch violated Securities 

Act Section 17(a)(3) [15 U.S.C. §77q(a)(3)]. 

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ELEVENTH CLAIM FOR RELIEF 
FRAUD IN THE OFFER OR SALE OF SECURITIES 

(Violations of Section 17(a)(3) of the Securities Act by Kaitz) 
 

275. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if 

fully set forth herein. 

276. During the Relevant Period, the stock of Vitality and Arch was each a security 

under Section 2(a)(1) of the Securities Act [15 U.S.C. §77b(a)(1)]. 

277. By reason of the conduct described above, defendant Kaitz, in connection with the 

offer or sale of securities, by the use of the means or instrumentalities of interstate commerce or 

of the mails, directly or indirectly, acting intentionally, knowingly, recklessly or negligently 

engaged in transactions, practices, or courses of business which operated or would operate as a 

fraud or deceit upon any persons, including purchasers or sellers of the securities.   

278. By reason of the conduct described above, defendant Kaitz violated Securities Act 

Section 17(a)(3) [15 U.S.C. §77q(a)(3)]. 

TWELFTH CLAIM FOR RELIEF 
AIDING AND ABETTING 

(Violations of Section 15(b) of the Securities Act by Gasarch) 
 

279. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if 

fully set forth herein. 

280. By reason of the conduct described above, Sharp, Kelln, Veldhuis, Sexton, 

Friesen, Carrillo, and other Sharp Group clients, directly or indirectly, in the offer or sale of 

securities, by the use of the means or instrumentalities of interstate commerce or of the mails, or 

of any facility of any national securities exchange, intentionally, knowingly or recklessly, 

(i) employed devices, schemes, or artifices to defraud; and (ii) engaged in transactions, practices, 

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or courses of business which operated or would operate as a fraud or deceit upon any persons, 

including purchasers or sellers of the securities.   

281. Gasarch knowingly or recklessly provided substantial assistance to Sharp, Kelln, 

Veldhuis, Sexton, Friesen, Carrillo, and other Sharp Group clients in their violations of Sections 

17(a)(1) and 17(a)(3) of the Securities Act.   

282. As a result, Gasarch violated Section 15(b) the Securities Act [15 U.S.C. §§ 

77o(b)].  

THIRTEENTH CLAIM FOR RELIEF 
AIDING AND ABETTING 

(Violations of Section 15(b) of the Securities Act by Kaitz) 
 

283. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if 

fully set forth herein. 

284. By reason of the conduct described above, Veldhuis, Sexton, and Friesen, directly 

or indirectly, in the offer or sale of securities, by the use of the means or instrumentalities of 

interstate commerce or of the mails, or of any facility of any national securities exchange, 

intentionally, knowingly or recklessly, (i) employed devices, schemes, or artifices to defraud; 

and (ii) engaged in transactions, practices, or courses of business which operated or would 

operate as a fraud or deceit upon any persons, including purchasers or sellers of the securities.   

285. Kaitz knowingly or recklessly provided substantial assistance to Veldhuis, 

Sexton, and Friesen in their violations of Sections 17(a)(1) and 17(a)(3) of the Securities Act.   

286. As a result, Kaitz violated Section 15(b) the Securities Act [15 U.S.C. §§ 77o(b)].  

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FOURTEENTH CLAIM FOR RELIEF 
AIDING AND ABETTING 

(Violations of Section 20(e) of the Exchange Act by Gasarch) 
 

287. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if 

fully set forth herein. 

288. By reason of the conduct described above, Sharp, Kelln, Veldhuis, Sexton, 

Friesen,  Carrillo, and other Sharp Group clients directly or indirectly, in connection with the 

purchase or sale of securities, by the use of the means or instrumentalities of interstate commerce 

or of the mails, or of any facility of any national securities exchange, intentionally, knowingly or 

recklessly, (i) employed devices, schemes, or artifices to defraud; and (ii) engaged in acts, 

practices, or courses of business which operated or would operate as a fraud or deceit upon any 

persons, including purchasers or sellers of the securities. 

289. Gasarch knowingly or recklessly provided substantial assistance to Sharp, Kelln, 

Veldhuis, Sexton, Friesen, Carrillo, and other Sharp Group clients in their violations of Section 

10(b) of the Exchange Act and Rules 10b-5(a) and (c) thereunder.   

290. As a result, Gasarch violated Section 20(e) the Exchange Act [15 U.S.C. § 78t(e)].  

FIFTEENTH CLAIM FOR RELIEF 
AIDING AND ABETTING 

(Violations of Section 20(e) of the Exchange Act by Kaitz) 
 

291. Paragraphs 1 through 231 above are re-alleged and incorporated by reference as if 

fully set forth herein. 

292. By reason of the conduct described above Veldhuis, Sexton, and Friesen directly 

or indirectly, in connection with the purchase or sale of securities, by the use of the means or 

instrumentalities of interstate commerce or of the mails, or of any facility of any national 

securities exchange, intentionally, knowingly or recklessly, (i) employed devices, schemes, or 

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artifices to defraud; and (ii) engaged in acts, practices, or courses of business which operated or 

would operate as a fraud or deceit upon any persons, including purchasers or sellers of the 

securities. 

293. Kaitz knowingly or recklessly provided substantial assistance to Veldhuis, 

Sexton, and Friesen in their violations of Section 10(b) of the Exchange Act and Rules 10b-5(a) 

and (c) thereunder.   

294. As a result, Kaitz violated Section 20(e) the Exchange Act [15 U.S.C. § 78t(e)].  

PRAYER FOR RELIEF 

WHEREFORE, the Commission respectfully requests that this Court: 

A. Enter a permanent injunction restraining the defendants Sharp, Kelln, Veldhuis, 

Sexton, Friesen, Dhillon, Gasarch, Kaitz and Taylor, their agents, servants, employees and 

attorneys, and those persons in active concert or participation with them who receive actual 

notice of the injunction by personal service or otherwise, from violating Sections 17(a) of the 

Securities Act [15 U.S.C. §§77q(a)], and Section 10(b) of the Exchange Act [15 U.S.C. §§78j(b)] 

and Rule 10b-5 thereunder [17 C.F.R. §240.10b-5]. 

B. Enter a permanent injunction restraining defendants Sharp, Kelln, Veldhuis, 

Sexton, Friesen, Taylor and Dhillon, their agents, servants, employees and attorneys, and those 

persons in active concert or participation with them who receive actual notice of the injunction 

by personal service or otherwise, from violating Sections 5(a) and 5(c) of the Securities Act [15 

U.S.C. §§77e(a), (c)]. 

C. Enter a permanent injunction restraining defendants Veldhuis, Sexton, and 

Friesen, their agents, servants, employees and attorneys, and those persons in active concert or 

participation with them who receive actual notice of the injunction by personal service or 

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otherwise, from violating Section 13(d) of the Exchange Act [15 U.S.C. §78m(d)] and Rule 13d-

1 thereunder. 

D. Enter a permanent injunction restraining defendant Dhillon, his agents, servants, 

employees and attorneys, and those persons in active concert or participation with him who 

receive actual notice of the injunction by personal service or otherwise, from violating Section 

13(d) of the Exchange Act [15 U.S.C. §78m(d)] and Rule 13d-2 thereunder. 

E. Enter a permanent injunction restraining defendant Dhillon, his agents, servants, 

employees and attorneys, and those persons in active concert or participation with him who 

receive actual notice of the injunction by personal service or otherwise, from violating Section 

16(a) of the Exchange Act [15 U.S.C. §78p(a)] and Rule 16a-3 thereunder. 

 F.  Order the defendants to disgorge, with prejudgment interest, all ill-gotten gains 

obtained by reason of the unlawful conduct alleged in this Complaint pursuant to Section 

21(d)(7) of the Exchange Act [15 U.S.C. §78u(d)(7)]; 

G. Order the defendants to pay civil monetary penalties pursuant to Section 20(d) of 

the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) of the Exchange Act [15 U.S.C. 

§ 78u(d)(3)];  

H. Enter an order barring the defendants from participating in any offering of a 

penny stock, pursuant to Section 20(g) of the Securities Act [15 U.S.C. § 77t(g)] and 21(d) of the 

Exchange Act [15 U.S.C. § 78u(d)]; 

I. Enter an order barring the defendants from directly or indirectly, including, but 

not limited to, through an entity owned or controlled by any of them, participating in the 

issuance, purchase, offer, or sale of any security; provided, however, that such injunction shall 

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not prevent defendants from purchasing or selling securities listed on a national securities 

exchange for their own personal account; 

J. Enter an order barring defendant Dhillon from serving as an officer or director of 

a public company pursuant to Section 20(e) of the Securities Act [15 U.S.C. § 77t(e)] and 

21(d)(2) of the Exchange Act [15 U.S.C. § 78u(d)(2)]; 

K. Retain jurisdiction over this action to implement and carry out the terms of all 

orders and decrees that may be entered; and  

L. Grant such other and further relief as this Court may deem just and proper. 

JURY DEMAND 

The Commission demands a jury in this matter for all claims so triable. 

 

DATED this 4th day of August, 2021. 

 

      Respectfully submitted, 

/s/ Eric A. Forni 
Eric A. Forni (Mass Bar No. 669685) 
Kathleen B. Shields (Mass Bar No. 637438) 
Katherine Bromberg (New York Bar No. 4154555) 
J. Lee Buck II (DC Bar No. 421878) 

      Edward B. Gerard (CA Bar No. 248053) 
Amy Gwiazda (Mass Bar No. 663494) 
Martin Healey (Mass Bar No. 227550) 

      SECURITIES AND EXCHANGE COMMISSION 
Boston Regional Office 
33 Arch St., 24th Floor  
Boston, MA 02110 
Phone: (617) 573-8904 (Shields direct),  
(617) 573-8827 (Forni direct) 
Fax: (617) 573-4590 (fax) 
[email protected] (Shields email) 
[email protected] (Forni email) 

  

Case 1:21-cv-11276-WGY *SEALED*   Document 1   Filed 08/05/21   Page 81 of 81