2016-09-28 sec-litreleases litigation_release 66 KB 2,720 chars

SEC v. Craig V. Sizer; and Miguel Mesa, No. LR-23658, Southern District of Florida (Sept. 28, 2016) — Press Release

raw: Craig V. Sizer, and Miguel Mesa

Craig V. Sizer, and Miguel Mesa, No. 1:16-CV-24106-JAL (Sept. 28, 2016)

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Securities and Exchange Commission v. Craig V. Sizer, and Miguel Mesa
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Craig V

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Craig V. Sizer, former CEO of Sanomedics Inc. and Fun Cool Free Inc., and Miguel Mesa, a boiler room operator, were accused of defrauding approximately 400 seniors and other investors out of $20 million by misrepresenting the use of investor funds in penny stock companies. The SEC alleged that Sizer and Mesa misappropriated 90% of the funds raised, using them for personal enrichment and sales commissions. Sizer and Mesa were charged with violating Sections 17(a) and 10(b) of the Securities Act and Exchange Act, and agreed to partial settlements, including being barred from future penny stock offerings and public company roles, with financial sanctions to be determined later.

narrative

Craig V. Sizer, former CEO of Sanomedics Inc. and Fun Cool Free Inc., and Miguel Mesa, a boiler room operator, were accused of defrauding approximately 400 seniors and other investors out of $20 million by misrepresenting the use of investor funds in penny stock companies. The SEC alleged that Sizer and Mesa misappropriated 90% of the funds raised, using them for personal enrichment and sales commissions. Sizer and Mesa were charged with violating Sections 17(a) and 10(b) of the Securities Act and Exchange Act, and agreed to partial settlements, including being barred from future penny stock offerings and public company roles, with financial sanctions to be determined later. The U.S. Securities and Exchange Commission charged former Sanomedics Inc. and Fun Cool Free Inc. CEO Craig V. Sizer and boiler room operator Miguel Mesa with defrauding hundreds of investors, primarily seniors, out of approximately $20 million by falsely promising that funds would fund research and development and that no sales commissions would be paid. Instead, Sizer and Mesa misappropriated about 90% of investor funds to enrich themselves and pay commissions to fraudulent sales agents, using deceptive pitch points to sell worthless penny stocks. The SEC alleged violations of Sections 17(a) and 10(b) of the federal securities laws, with Mesa also violating Section 15(a) and Sizer aiding and abetting those violations. Both defendants agreed to partial settlements, accepting permanent bars from participating in penny stock offerings and Sizer being barred from serving as an officer or director of a public company, with financial penalties to be determined by the court. Parallel criminal charges were filed by the U.S. Attorney’s Office, and the SEC’s investigation involved the FBI and FINRA. The U.S. Securities and Exchange Commission charged former microcap CEO Craig V. Sizer and boiler room operator Miguel Mesa with defrauding hundreds of investors, primarily seniors, out of approximately $20 million by promoting fraudulent penny stocks in Sanomedics Inc. and Fun Cool Free Inc. The defendants misrepresented that investor funds would support research and development and that no commissions would be paid, when in fact about 90% of the proceeds were misappropriated to enrich themselves and pay sales commissions. Sizer and Mesa agreed to partial settlements without admitting or denying guilt, accepting permanent bars from participating in penny stock offerings and, in Sizer’s case, from serving as an officer or director of a public company, with financial penalties to be determined later. They were charged with violating Sections 17(a) of the Securities Act and 10(b) and Rule 10b-5 of the Exchange Act, with Mesa also charged under Section 15(a), and parallel criminal charges were filed by the U.S. Attorney’s Office. The SEC’s investigation, supported by the FBI and FINRA, remains ongoing.

Enriched metadata

Scheme
boiler-room (95%)
Court
Southern District of Florida
Case No.
1:16-CV-24106-JAL
Outcome
settled · 2016-09-26
Victim loss
$20,000,000
Entity
Craig V. Sizer
Classified boiler-room(confidence 95%). EDGAR detection: forms Form D· recall 50% / precision 4%. detection rule →
Statutes
Section 17(a) of the Securities ActSection 10(b) of the Securities Exchange ActRule 10b-5
Parties
Securities and Exchange CommissionCraig V. SizerMiguel Mesa
Keywords
sizermesacraig sizersecurities exchangesizer miguelmiguel mesaexchange commissionsizer mesasecuritiesexchangesec'scraigmiguelsecmesa securities

Exhibits & Attached Documents (1)

Extracted insights

Dollar amounts 1
  • $20.00M $20 million $10M–$100M
Entities 6
  • scheme_term boiler room
  • person craig v. sizer
  • person lucrative profits
  • company microcap company
  • person miguel mesa
  • company sanomedics inc.
Triples 19
  • Craig V. Sizer founded Sanomedics Inc.
  • Craig V. Sizer charged with fraud
  • Miguel Mesa charged with fraud
  • SEC charged Craig V. Sizer and Miguel Mesa
  • Craig V. Sizer operated boiler room
  • SEC alleges fraud against seniors and others
  • Craig V. Sizer promised lucrative profits
  • Miguel Mesa pressured investors to invest
  • SEC filed lawsuit Securities and Exchange Commission v. Craig V. Sizer, and Miguel Mesa
  • Craig V. Sizer led microcap company
  • SEC announced charges on September 26, 2016
  • Craig V. Sizer founded Sanomedics Inc.
  • U.S. Securities and Exchange Commission charged Craig V. Sizer and Miguel Mesa with fraud
  • Craig V. Sizer and Miguel Mesa defrauded seniors and others who were pressured to invest in penny stock companies
  • Securities and Exchange Commission charged a former microcap company CEO and a boiler room operator on September 26, 2016
  • Securities and Exchange Commission alleges Craig V. Sizer founded Sanomedics Inc.
  • Craig V. Sizer founded Sanomedics Inc.
  • SEC issued Litigation Release No. 23658 on September 28, 2016
  • SEC named Craig V. Sizer and Miguel Mesa as defendants in Civil Action No. 1:16-CV-24106-JAL
PDF (from attached: complaint)
(collectively “Defendants”) for violating the antifraud and broker-dealer registration provisions · Source
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U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 23658 / September 28, 2016 Securities and Exchange Commission v. Craig V. Sizer, and Miguel Mesa, Civil Action No. 1:16-CV-24106-JAL (S.D. Fla.) SEC Charges CEO and Boiler Room Operator with Fraud On September 26, 2016 the Securities and Exchange Commission charged a former microcap company CEO and a boiler room operator with defrauding seniors and others who were pressured to invest in a pair of penny stock companies and promised lucrative profits. The SEC alleges that Craig V. Sizer founded Sanomedics Inc. and Fun Cool Free Inc., which were purportedly in the business of selling non-contact infrared thermometers and software applications respectively, and he hired Miguel "Michael" Mesa to help him attract and defraud investors in both companies. Sizer allegedly provided Mesa with a list of pitch points for use by boiler-room agents hired by Mesa to sell shares of the stocks based on misrepresentations that investor funds would be used for research and development and no sales commissions would be paid out of investor funds. According to the SEC's complaint, Sizer and Mesa misappropriated approximately 90 percent of the funds raised from investors, enriching themselves and paying sales commissions to the boiler-room agents. Several hundred investors nationwide were allegedly defrauded out of a total of approximately $20 million. In a parallel action on September 26, 2016, the U.S. Attorney's Office for the Southern District of Florida announced criminal charges. Sizer and Mesa have agreed to partial settlements of the SEC's charges without admitting or denying the allegations. They both agreed to be barred from future penny stock offerings, and Sizer agreed to be barred from serving as an officer or director of a public company. Financial sanctions will be decided by the court at a later date. The SEC's complaint alleges that Sizer and Mesa violated Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5. Mesa also allegedly violated Section 15(a) of the Exchange Act, and Sizer allegedly aided and abetted Mesa's violations. The SEC's continuing investigation is being conducted by Gary M. Miller and Eric E. Morales of the Enforcement Division's Microcap Fraud Task Force in the Miami office, and the case has been supervised by Elisha L. Frank and Jason R. Berkowitz of the Microcap Fraud Task Force. The SEC's litigation is being led by Alejandro O. Soto. The SEC appreciates the assistance of the Federal Bureau of Investigation, the U.S. Attorney's Office for the Southern District of Florida, and the Financial Industry Regulatory Authority. SEC Complaint
OCR text (2,720c · html-text · 99% conf) 
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 23658 / September 28, 2016 Securities and Exchange Commission v. Craig V. Sizer, and Miguel Mesa, Civil Action No. 1:16-CV-24106-JAL (S.D. Fla.) SEC Charges CEO and Boiler Room Operator with Fraud On September 26, 2016 the Securities and Exchange Commission charged a former microcap company CEO and a boiler room operator with defrauding seniors and others who were pressured to invest in a pair of penny stock companies and promised lucrative profits. The SEC alleges that Craig V. Sizer founded Sanomedics Inc. and Fun Cool Free Inc., which were purportedly in the business of selling non-contact infrared thermometers and software applications respectively, and he hired Miguel "Michael" Mesa to help him attract and defraud investors in both companies. Sizer allegedly provided Mesa with a list of pitch points for use by boiler-room agents hired by Mesa to sell shares of the stocks based on misrepresentations that investor funds would be used for research and development and no sales commissions would be paid out of investor funds. According to the SEC's complaint, Sizer and Mesa misappropriated approximately 90 percent of the funds raised from investors, enriching themselves and paying sales commissions to the boiler-room agents. Several hundred investors nationwide were allegedly defrauded out of a total of approximately $20 million. In a parallel action on September 26, 2016, the U.S. Attorney's Office for the Southern District of Florida announced criminal charges. Sizer and Mesa have agreed to partial settlements of the SEC's charges without admitting or denying the allegations. They both agreed to be barred from future penny stock offerings, and Sizer agreed to be barred from serving as an officer or director of a public company. Financial sanctions will be decided by the court at a later date. The SEC's complaint alleges that Sizer and Mesa violated Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5. Mesa also allegedly violated Section 15(a) of the Exchange Act, and Sizer allegedly aided and abetted Mesa's violations. The SEC's continuing investigation is being conducted by Gary M. Miller and Eric E. Morales of the Enforcement Division's Microcap Fraud Task Force in the Miami office, and the case has been supervised by Elisha L. Frank and Jason R. Berkowitz of the Microcap Fraud Task Force. The SEC's litigation is being led by Alejandro O. Soto. The SEC appreciates the assistance of the Federal Bureau of Investigation, the U.S. Attorney's Office for the Southern District of Florida, and the Financial Industry Regulatory Authority. SEC Complaint

Related documents (1)