A.S. Goldmen and Co., Inc. and Employees Charged with Variety of Microcap Related Violations
summary
The SEC and New York County DA charged A.S. Goldmen & Co., its president Anthony Marchiano, operations principal Stuart Winkler, and seven other employees with multiple microcap fraud schemes between 1994–1998, including unregistered sales of $7.5M in Millennium stock, IPO manipulation via nominee accounts generating $250K in illicit profits, and record falsification, resulting in administrative proceedings and criminal charges for enterprise corruption and money laundering.
paragraph
A.S. Goldmen & Co. and nine individuals, including president Anthony Marchiano and operations principal Stuart Winkler, were charged by the SEC with five interrelated fraud schemes between July 1994 and June 1998. These included an unregistered offering of over 3 million shares of Millennium Sports Management stock, raising at least $7.5 million through deceptive boiler-room tactics; Winkler’s manipulation of IPO securities via nominee and client accounts to generate at least $250,000 in illicit profits by artificially inflating prices and creating false market demand; and the falsification and destruction of regulatory records to conceal violations. Winkler and Marchiano also used client accounts to fabricate investor interest in IPOs, while other employees engaged in unauthorized trades, cross-trading, and undisclosed no-net-selling practices. The SEC initiated administrative proceedings seeking disgorgement and civil penalties, while the New York County DA filed parallel criminal charges including enterprise corruption and money laundering.
narrative
Between July 1994 and June 1998, A.S. Goldmen & Co. and nine individuals—including president Anthony Marchiano and operations principal Stuart Winkler—engaged in a series of coordinated microcap stock fraud schemes that targeted retail investors and manipulated public markets. The firm conducted an unregistered offering of over 3 million shares of Millennium Sports Management, Inc., raising at least $7.5 million while failing to deliver required prospectuses and using high-pressure cold-calling tactics, misrepresentations, and an undisclosed no-net-selling policy from its Naples, Florida boiler room. Winkler manipulated at least six IPOs by placing securities into nominee accounts, repurchasing them at a profit, and reselling them to investors at inflated prices, generating at least $250,000 in illicit gains while violating anti-manipulation rules. He and Marchiano further abused client accounts by placing IPO securities into them to fabricate demand, conceal misconduct, and resolve complaints, creating a false impression of market interest. Additionally, registered representative Charles Trento engaged in fraudulent cross-trading, unauthorized trades, and hidden financial interests, while Winkler directed the falsification and destruction of trade blotters, tickets, and customer complaints to evade regulators. The SEC initiated administrative proceedings seeking cease-and-desist orders, disgorgement, and civil penalties, and the New York County District Attorney’s Office filed criminal charges including enterprise corruption, schemes to defraud, money laundering, and criminal possession of stolen property, with a hearing pending to determine sanctions.
Classified boiler-room(confidence 80%). EDGAR detection: forms Form D· recall 50% / precision 4%. detection rule →
Statutes
Parties
Richard Walkerthe securities and exchange commission
Keywords
securitiesgoldmenwinklernaples floridanominee accountsmicrocapmarchianofloridagoldmen'saccountssalesnaplesdelciopponewmillennium
Extracted insights
Dollar amounts 2
- $7.50M $7.5 million $1M–$10M
- $250K $250,000 $100K–$1M
Entities 2
- person Richard Walker
- agency the securities and exchange commission
Triples 18
- The Securities and Exchange Commission Instituted Administrative and cease-and-desist proceedings
- The Securities and Exchange Commission Charged A.S. Goldmen & Co., Inc. with selling unregistered securities, fraudulent sales practices, and violations of the anti-manipulation provisions
- The Securities and Exchange Commission Charged Anthony J. Marchiano, Stuart E. Winkler, John T. Diasabeyagunawardena (a.k.a. John Abbey), John P. DelCioppo, Christopher M. DelCioppo, Vincent J. Lia, Duane P. Taylor, and Charles Trento
- Richard Walker Said We will spare no effort to close the doors of `boiler rooms' that fraudulently peddle stocks to unsuspecting investors and tarnish the reputation of our capital markets
- Goldmen, Marchiano and Winkler Conducted An unregistered offering of over 3 million shares of the common stock of Millennium Sports Management, Inc.
- Goldmen Failed to deliver Millennium prospectuses to Goldmen's retail clients who bought Millennium stock during the unregistered offering
- Goldmen Raised net proceeds Of at least $7.5 million through the sale of Millennium Stock during this period
- Marchiano, Abbey, John DelCioppo, Christopher DelCioppo, Lia, and Taylor Engaged in a scheme To sell Millennium common stock to retail clients using a variety of fraudulent and deceptive sales practices
- Goldmen's Naples, Florida office Became A `boiler room' that sold Millennium common stock through an aggressive cold-calling campaign involving high-pressure sales tactics, misrepresentations and omissions of material facts, baseless price predictions, unauthorized purchases, and an undisclosed no net-selling practice
- Winkler Violated The antimanipulation provisions of the federal securities laws
- Winkler Placed IPO securities Into at least four nominee accounts
- Goldmen Repurchased the securities After the IPOs at a substantial profit and resell them to bona fide investors at yet higher prices
- Goldmen Commenced market making activities In the securities while these IPO securities were in Winkler's nominee accounts
- The antimanipulation provisions of the federal securities laws Prohibited Goldmen from engaging in such market making activity while IPO securities remained under Winkler's control in the nominee accounts
- The Winkler nominee accounts Made At least $250,000
- Winkler and Marchiano Violated The antimanipulation provisions in a similar scheme designed to resolve client complaints
- Winkler and Marchiano Placed IPO securities Into the accounts of complaining clients during various IPOs underwritten by Goldmen
- Goldmen Commenced making markets In the securities while these securities remained under Winkler's and Marchiano's control in the client accounts
Extracted body text (6,487c)
For Immediate Release 99-77 A.S. Goldmen and Co., Inc. and Employees Charged with Variety of Microcap Related Violations Washington, DC, July 8, 1999 -- The Securities and Exchange Commission instituted administrative and cease-and- desist proceedings against A.S. Goldmen & Co., Inc., a registered broker-dealer, charging the firm with selling unregistered securities, fraudulent sales practices, and violations of the anti-manipulation provisions. Also charged in the proceedings are: * Anthony J. Marchiano, of Naples, Florida, Goldmen's president and sole owner; * Stuart E. Winkler, of Morganville, N.J., Goldmen's financial and operations principal; * John T. Diasabeyagunawardena (a.k.a. John Abbey) of Metuchen, N.J.; * John P. DelCioppo, of Naples, Florida; * Christopher M. DelCioppo, of Tampa, Florida; * Vincent J. Lia, of Naples, Florida; * Duane P. Taylor, of Naples, Florida; and * Charles Trento, of Forked River, N.J. Abbey, John DelCioppo, Christopher DelCioppo, Lia, and Taylor, were all registered representatives in Goldmen's Naples, Florida office. Trento was a registered representative in Goldmen's New Jersey Office. Richard Walker, the Director of the Division of Enforcement said, "We will spare no effort to close the doors of `boiler rooms' that fraudulently peddle stocks to unsuspecting investors and tarnish the reputation of our capital markets." The order charges Goldmen, Marchiano, Winkler and the former registered representatives with five interrelated schemes that occurred between July 1994 to June 1998: First, from April 1997 to April 1998, Goldmen, Marchiano and Winkler conducted an unregistered offering of over 3 million shares of the common stock of Millennium Sports Management, Inc., a publicly-traded New Jersey corporation, and failed to deliver Millennium prospectuses to Goldmen's retail clients who bought Millennium stock during the unregistered offering. Goldmen raised net proceeds of at least $7.5 million through the sale of Millennium Stock during this period. Second, from July 1997 to June 1998, Marchiano, Abbey, John DelCioppo, Christopher DelCioppo, Lia, and Taylor engaged in a scheme to sell Millennium common stock to retail clients using a variety of fraudulent and deceptive sales practices. Under Marchiano's direction, Goldmen's Naples, Florida office became a "boiler room" that sold Millennium common stock through an aggressive cold-calling campaign involving high- pressure sales tactics, misrepresentations and omissions of material facts, baseless price predictions, unauthorized purchases, and an undisclosed no net- selling practice. Third, from July 1994 to February 1997, Winkler violated the antimanipulation provisions of the federal securities laws. During at least six initial public offerings ("IPOs") underwritten by Goldmen, Winkler placed IPO securities into at least four nominee accounts. Winkler then had Goldmen immediately repurchase the securities after the IPOs at a substantial profit and resell them to bona fide investors at yet higher prices. While these IPO securities were in his nominee accounts, Winkler had Goldmen commence market making activities in the securities. The antimanipulation provisions of the federal securities laws prohibited Goldmen from engaging in such market making activity while IPO securities remained under Winkler's control in the nominee accounts. The Winkler nominee accounts made at least $250,000. Fourth, during the same period, Winkler and Marchiano violated the antimanipulation provisions in a similar scheme designed to resolve client complaints. Winkler and Marchiano placed IPO securities into the accounts of complaining clients during various IPOs underwritten by Goldmen and controlled the repurchase and resale of the securities, guaranteeing those clients a profit. While these securities remained under Winkler's and Marchiano's control in the client accounts, Goldmen commenced making markets in the securities. In one instance, Winkler and Marchiano placed nearly 30 percent of the IPO warrants into the accounts of complaining clients. This same scheme violated the antifraud provisions by creating a materially false impression of the nature and extent of investor interest in the offerings and aftermarket for the IPO securities. Fifth, from July 1994 to May 1997, Trento engaged in a pattern of fraudulent sales practices. These practices included: the use of nominee accounts to hide his financial interest in certain sales of securities; engaging in fraudulent cross-trading; making baseless price predictions; executing unauthorized and unsuitable trades; and engaging in an undisclosed no net-selling practice. In addition to the schemes described above, Winkler is charged with instructing certain Goldmen employees, including Goldmen's compliance director, to falsify, conceal and destroy various required books and records, including trade blotters, trade tickets, and customer complaints. The order alleges that Winkler did so to conceal from regulators, among other things, evidence of sales practice abuses, as well as other violations of federal and state securities laws. A hearing will be held before an administrative law judge to determine whether the allegations against the respondents are true and, if so, to determine what remedial sanctions are appropriate and in the public interest, and whether the respondents should be ordered to pay disgorgement and/or civil penalties. The Division of Enforcement thanks the New York County District Attorney's Office, the National Association of Securities Dealers (NASD), and the New Jersey Bureau of Securities for their assistance in the investigation. Also today, the New York County District Attorney's Office brought criminal charges against Goldmen and numerous former Goldmen brokers, employees, and others associated with the firm. The indictments include charges of enterprise corruption, schemes to defraud, criminal possession of stolen property, money laundering, and violations of the New York General Business Law. This enforcement action is one of several cases filed in an effort to address abuses in the offer and sale of microcap stocks. It is also part of the Commission's four-pronged approach to minimizing microcap fraud: enforcement, inspections, investor education and regulation. For more information about the SEC's response to microcap fraud, visit the SEC's Microcap Fraud Information Center at http://www.sec.gov/news/extra/microcap.htm. # # #OCR text (6,487c · plain-text · 99% conf)
For Immediate Release 99-77 A.S. Goldmen and Co., Inc. and Employees Charged with Variety of Microcap Related Violations Washington, DC, July 8, 1999 -- The Securities and Exchange Commission instituted administrative and cease-and- desist proceedings against A.S. Goldmen & Co., Inc., a registered broker-dealer, charging the firm with selling unregistered securities, fraudulent sales practices, and violations of the anti-manipulation provisions. Also charged in the proceedings are: * Anthony J. Marchiano, of Naples, Florida, Goldmen's president and sole owner; * Stuart E. Winkler, of Morganville, N.J., Goldmen's financial and operations principal; * John T. Diasabeyagunawardena (a.k.a. John Abbey) of Metuchen, N.J.; * John P. DelCioppo, of Naples, Florida; * Christopher M. DelCioppo, of Tampa, Florida; * Vincent J. Lia, of Naples, Florida; * Duane P. Taylor, of Naples, Florida; and * Charles Trento, of Forked River, N.J. Abbey, John DelCioppo, Christopher DelCioppo, Lia, and Taylor, were all registered representatives in Goldmen's Naples, Florida office. Trento was a registered representative in Goldmen's New Jersey Office. Richard Walker, the Director of the Division of Enforcement said, "We will spare no effort to close the doors of `boiler rooms' that fraudulently peddle stocks to unsuspecting investors and tarnish the reputation of our capital markets." The order charges Goldmen, Marchiano, Winkler and the former registered representatives with five interrelated schemes that occurred between July 1994 to June 1998: First, from April 1997 to April 1998, Goldmen, Marchiano and Winkler conducted an unregistered offering of over 3 million shares of the common stock of Millennium Sports Management, Inc., a publicly-traded New Jersey corporation, and failed to deliver Millennium prospectuses to Goldmen's retail clients who bought Millennium stock during the unregistered offering. Goldmen raised net proceeds of at least $7.5 million through the sale of Millennium Stock during this period. Second, from July 1997 to June 1998, Marchiano, Abbey, John DelCioppo, Christopher DelCioppo, Lia, and Taylor engaged in a scheme to sell Millennium common stock to retail clients using a variety of fraudulent and deceptive sales practices. Under Marchiano's direction, Goldmen's Naples, Florida office became a "boiler room" that sold Millennium common stock through an aggressive cold-calling campaign involving high- pressure sales tactics, misrepresentations and omissions of material facts, baseless price predictions, unauthorized purchases, and an undisclosed no net- selling practice. Third, from July 1994 to February 1997, Winkler violated the antimanipulation provisions of the federal securities laws. During at least six initial public offerings ("IPOs") underwritten by Goldmen, Winkler placed IPO securities into at least four nominee accounts. Winkler then had Goldmen immediately repurchase the securities after the IPOs at a substantial profit and resell them to bona fide investors at yet higher prices. While these IPO securities were in his nominee accounts, Winkler had Goldmen commence market making activities in the securities. The antimanipulation provisions of the federal securities laws prohibited Goldmen from engaging in such market making activity while IPO securities remained under Winkler's control in the nominee accounts. The Winkler nominee accounts made at least $250,000. Fourth, during the same period, Winkler and Marchiano violated the antimanipulation provisions in a similar scheme designed to resolve client complaints. Winkler and Marchiano placed IPO securities into the accounts of complaining clients during various IPOs underwritten by Goldmen and controlled the repurchase and resale of the securities, guaranteeing those clients a profit. While these securities remained under Winkler's and Marchiano's control in the client accounts, Goldmen commenced making markets in the securities. In one instance, Winkler and Marchiano placed nearly 30 percent of the IPO warrants into the accounts of complaining clients. This same scheme violated the antifraud provisions by creating a materially false impression of the nature and extent of investor interest in the offerings and aftermarket for the IPO securities. Fifth, from July 1994 to May 1997, Trento engaged in a pattern of fraudulent sales practices. These practices included: the use of nominee accounts to hide his financial interest in certain sales of securities; engaging in fraudulent cross-trading; making baseless price predictions; executing unauthorized and unsuitable trades; and engaging in an undisclosed no net-selling practice. In addition to the schemes described above, Winkler is charged with instructing certain Goldmen employees, including Goldmen's compliance director, to falsify, conceal and destroy various required books and records, including trade blotters, trade tickets, and customer complaints. The order alleges that Winkler did so to conceal from regulators, among other things, evidence of sales practice abuses, as well as other violations of federal and state securities laws. A hearing will be held before an administrative law judge to determine whether the allegations against the respondents are true and, if so, to determine what remedial sanctions are appropriate and in the public interest, and whether the respondents should be ordered to pay disgorgement and/or civil penalties. The Division of Enforcement thanks the New York County District Attorney's Office, the National Association of Securities Dealers (NASD), and the New Jersey Bureau of Securities for their assistance in the investigation. Also today, the New York County District Attorney's Office brought criminal charges against Goldmen and numerous former Goldmen brokers, employees, and others associated with the firm. The indictments include charges of enterprise corruption, schemes to defraud, criminal possession of stolen property, money laundering, and violations of the New York General Business Law. This enforcement action is one of several cases filed in an effort to address abuses in the offer and sale of microcap stocks. It is also part of the Commission's four-pronged approach to minimizing microcap fraud: enforcement, inspections, investor education and regulation. For more information about the SEC's response to microcap fraud, visit the SEC's Microcap Fraud Information Center at http://www.sec.gov/news/extra/microcap.htm. # # #