In April 2012, while Eldaher was associated with ACAP, he reached an
agreement with Efstratios “Elias” D. Argyropoulos (“Argyropoulos”), the principal of
Prima Capital Group, Inc. (“Prima”), an entity purporting to sell pre-IPO Facebook shares
in the secondary market, by which Eldaher would receive 50% of the mark-up on Facebook
shares sold to investors Eldaher successfully solicited. In 2012, Eldaher sold $362,887.50
worth of Facebook shares to twelve investors throughout the country. Eldaher was paid
$15,478 by Prima. ACAP did not know about Eldaher’s arrangement with Argyropoulos
and terminated Eldaher for selling securities other than through ACAP.
C. VIOLATIONS
As a result of the conduct described above, Eldaher willfully violated
Section 15(a)(1) of the Exchange Act, which makes it unlawful for a broker or dealer “to
make use of the mails or any means or instrumentality of interstate commerce to effect any
transactions in, or to induce or attempt to induce the purchase or sale of, any security”
unless registered with the Commission in accordance with Section 15(b) of the Exchange
Act.
III.
In view of the allegations made by the Division of Enforcement, the Commission
deems it necessary and appropriate in the public interest that public administrative and
cease-and-desist proceedings be instituted to determine:
A. Whether the allegations set forth in Section II hereof are true and, in
connection therewith, to afford Respondent an opportunity to establish any defenses to such
allegations;
B. What, if any, remedial action is appropriate in the public interest against
Respondent pursuant to Section 15(b) of the Exchange Act including, but not limited to,
disgorgement and civil penalties pursuant to Section 21B of the Exchange Act;
C. What, if any, remedial action is appropriate in the public interest against
Respondent pursuant to Section 9(b) of the Investment Company Act; and
D. Whether, pursuant to Section 21C of the Exchange Act, Respondent should
be ordered to cease and desist from committing or causing violations of and any future
violations of Section 15(a)(1) of the Exchange Act, whether Respondent should be ordered
to pay a civil penalty pursuant to Section 21B(a) of the Exchange Act, and whether
Respondent should be ordered to pay disgorgement pursuant to Sections 21B(e) and 21C(e)
of the Exchange Act.
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IV.
IT IS ORDERED that a public hearing for the purpose of taking evidence on the
questions set forth in Section III hereof shall be convened not earlier than 30 days and not
later than 60 days from service of this Order at a time and place to be fixed, and before an
Administrative Law Judge to be designated by further order as provided by Rule 110 of the
Commission’s Rules of Practice, 17 C.F.R. § 201.110.
IT IS FURTHER ORDERED that Respondent shall file an Answer to the allegations
contained in this Order within twenty (20) days after service of this Order, as provided by
Rule 220 of the Commission's Rules of Practice, 17 C.F.R. § 201.220.
If Respondent fails to file the directed answer, or fails to appear at a hearing after
being duly notified, the Respondent may be deemed in default and the proceedings may be
determined against him upon consideration of this Order, the allegations of which may be
deemed to be true as provided by Rules 155(a), 220(f), 221(f) and 310 of the Commission's
Rules of Practice, 17 C.F.R. §§ 201.155(a), 201.220(f), 201.221(f) and 201.310.
This Order shall be served forthwith upon Respondent as provided for in the
Commission’s Rules of Practice.
IT IS FURTHER ORDERED that the Administrative Law Judge shall issue an
initial decision no later than 300 days from the date of service of this Order, pursuant to
Rule 360(a)(2) of the Commission’s Rules of Practice.
In the absence of an appropriate waiver, no officer or employee of the Commission
engaged in the performance of investigative or prosecuting functions in this or any factually
related proceeding will be permitted to participate or advise in the decision of this matter,
except as witness or counsel in proceedings held pursuant to notice. Since this proceeding is
not “rule making” within the meaning of Section 551 of the Administrative Procedure Act, it
is not deemed subject to the provisions of Section 553 delaying the effective date of any
final Commission action.
By the Commission.
Brent J. Fields
Secretary
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