SEC WINS JURY VERDICT AGAINST PENNY STOCK TRADER JERRY ROSEN AND ACCOMPLICES
FOR ROLE IN SYSTEMS OF EXCELLENCE MANIPULATION; FINAL JUDGMENTS ORDER
DISGORGEMENT, PREJUDGMENT INTEREST, CIVIL PENALTIES AND A PERSONAL TRADING
BAN AGAINST ROSEN
The Commission announced that on April 24, 2002, the Honorable Donald M.
Middlebrooks, United States District Judge for the Southern District of
Florida, entered final judgments against penny stock trader Jerome E.
Rosen, disbarred attorney William A. Calvo III, and Calvo's company,
Diversified Corporate Consulting Group. Rosen, the trader exclusively
responsible for his firm's market making activity in Systems of
Excellence, Inc. (SOE), accepted a bribe, in the form of free SOE stock,
in exchange for his efforts to manipulate the price of SOE.
Diversified, a company controlled by Calvo, among others, supported
Rosen's fraudulent and manipulative trading activity and sold
unregistered shares of SOE while one of its principals was touting SOE
in a popular penny stock newsletter. The final judgments, which follow
a March 7, 2002 jury verdict in favor of the SEC, permanently enjoin (i)
Rosen and Diversified from future violations of the antifraud provisions
of the federal securities laws and (ii) Calvo, Rosen and Diversified
from future violations of the registration provisions. In total, Rosen,
Calvo and Diversified were ordered to pay more than $3.8 million in ill-
gotten gains, prejudgment interest and civil penalties, all arising from
their respective roles in the manipulation of SOE stock. Additionally,
the Court enjoined Rosen from buying and selling individual stocks.
With these final judgments, the Commission has now successfully
concluded seven separate enforcement actions arising from its
investigation of SOE, assisted in obtaining four criminal convictions,
deregistered the securities of SOE, and recovered approximately $15
million for defrauded investors. Two related lawsuits against other
defendants are still pending. [SEC v. Jerome E. Rosen, Diversified
Corporate Consulting Group, Joseph D. Radcliffe, and William A. Calvo
III, Civil Action No. 01-0369-CIV-Middlebrooks (S.D. Fla.)] (LR-17510) |
