Re: In the Matter of National Investors Council, In the Matter of Smith; In the Matter of TKO International
UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION
SECURITIES ACT OF 1933
Release No. 7600 / October 27, 1998
ADMINISTRATIVE PROCEEDING
File No. 3-9766
______________________________________
In the Matter of
NATIONAL INVESTORS COUNCIL and SKIP NORDSTROM,
Respondents.
______________________________________
ORDER INSTITUTING PUBLIC CEASE-AND-DESIST PROCEEDING, MAKING
FINDINGS AND ISSUING A CEASE-AND-DESIST ORDER
I.
The Securities and Exchange Commission ("Commission")
deems it appropriate that a public cease-and-desist
proceeding pursuant to Section 8A of the Securities Act of
1933 ("Securities Act") be instituted against National
Investors Council ("NIC") and Skip Nordstrom ("Nordstrom").
II.
In anticipation of the institution of this proceeding,
NIC and Nordstrom have each submitted an Offer of
Settlement, each of which the Commission has determined to
accept. Solely for the purpose of this proceeding and any
other proceeding brought by or on behalf of the Commission
or in which the Commission is a party, and without admitting
or denying the findings contained herein, except that NIC
and Nordstrom each admits the jurisdiction of the Commission
over each of them and over the subject matter of this
proceeding, NIC and Nordstrom each consents to the entry of
this Order Instituting Public Cease-and-Desist Proceeding,
Making Findings and Issuing a Cease-and-Desist Order
("Order") set forth below.
Accordingly, IT IS ORDERED that a proceeding pursuant
to Section 8A of the Securities Act be, and hereby is,
instituted.
III.
On the basis of this Order and the Offers of Settlement
submitted by NIC and Nordstrom, the Commission finds that:
A. RESPONDENTS
1. NIC is the fictitious business name for a Newport
Beach, California publishing business owned and
operated by Skip Nordstrom. NIC publishes two
publications on the internet: Skip Nordstrom's
Growthstock Newsletter ("Newsletter") and Portfolio
Picks, both of which are found on NIC's website.
2. Nordstrom is forty-seven (47) years old and resides in
Santa Ana, California. He is the sole employee and
owner of NIC.
B. FACTS
1. Nordstrom operates NIC out of his office located in
Newport Beach, California. Nordstrom writes NIC's
Newsletter and determines which issuers will be listed
in NIC's Portfolio Picks.
2. Portfolio Picks provides an overview of approximately
twelve companies which NIC represents have growth
potential. Persons interested in a particular company
can click on the stock symbol for the company within
Portfolio Picks and receive information regarding
current stock price and volume. A corporate digest
summarizing the company's operations is also available.
The Newsletter profiles small, publicly-held companies
that, in Nordstrom's opinion, have a two to five year
growth potential. The Newsletter is also available to
subscribers via regular mail and has a circulation of
approximately 1,000. Certain companies featured in the
Newsletter have been listed, sometimes concurrently, in
Portfolio Picks.
3. NIC charges a $900 monthly fee for a company to be
listed in Portfolio Picks, for a minimum of three
consecutive months. Under certain circumstances, NIC
has agreed to reduce the monthly fee or accepted
securities as payment. Prior to commencement of the
Commission's investigation, NIC's website contained a
disclaimer that readers should assume that NIC, its
principals, officers, and employees have a vested
interest in the companies presented on NIC's website,
which may have been acquired under terms and conditions
not available to the public.
4. Section 17(b) of the Securities Act prohibits any
person from publishing, giving publicity to, or
circulating any notice, circular, advertisement,
newspaper, article, letter, investment service or
communication which describes a security for a
consideration received or to be received, directly or
indirectly, from an issuer, underwriter or dealer,
without fully disclosing the receipt, whether past or
prospective, of such consideration and the amount
thereof. As a result of the conduct identified in
paragraphs III.B.1. through III.B.3., NIC and Nordstrom
violated Section 17(b) of the Securities Act by
publishing and giving publicity to communications which
described issuers featured in Portfolio Picks in
exchange for consideration, without disclosing the
amount of such consideration.
IV.
Based on the foregoing, the Commission deems it
appropriate to accept the Offers of Settlement submitted by
NIC and Nordstrom.
Accordingly, IT IS HEREBY ORDERED that:
A. Pursuant to Section 8A of the Securities Act, NIC
cease and desist from committing or causing any violation
and any future violation of Section 17(b) of the Securities
Act; and
B. Pursuant to Section 8A of the Securities Act,
Nordstrom cease and desist from committing or causing any
violation and any future violation of Section 17(b) of the
Securities Act.
By the Commission.
Jonathan G. Katz
Secretary
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
SECURITIES ACT OF 1933
Release No. 7603 / October 27, 1998
ADMINISTRATIVE PROCEEDING
File No. 3-9770
Order Instituting Proceedings against Maynard Matt Smith
The Commission announced the institution of a cease-and-desist proceeding
against Maynard Matt Smith ("Smith") alleging that he was a cause
of violations of the antitouting provision of the federal securities laws.
The Order alleges that from June 1997 through June 1998, Smith
received approximately $4,500 per month from the author and
publisher of investment newsletters (hereinafter the "author")
for researching public companies and writing and editing
articles. Smith was not directly involved in the circulation or
publication of the investment newsletters. Smith reviewed and
edited one of the author's investment newsletters, dated
September 8, 1997, recommending the stock of an issuer. At the
time Smith reviewed and edited this newsletter, Smith and the
author were negotiating with that issuer and anticipated that
they would each receive $2,500 per month from that issuer. This
newsletter did not disclose that they anticipated compensation or
the amount of compensation anticipated from that issuer. As a
result of this conduct, staff allege that Smith caused violations
of Section 17(b) of the Securities Act of 1933. A hearing will
be held to determine whether the allegations are true and if so,
whether to issue a cease-and-desist order.
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UNITED STATE SECURITIES AND EXCHANGE COMMISSION
SECURITIES ACT OF 1933
Release No. 7602 / October 27, 1998
Administrative Proceeding
File No. 3-9769
PROCEEDINGS INSTITUTED AGAINST TKO INTERNATIONAL, INC.
AND LEONARD A. TURANO
The Commission instituted an administrative
proceeding against TKO International, Inc. ("TKO") and
Leonard A. Turano, its president and sole shareholder to
determine whether to issue a cease-and-desist order
against the respondents. The Commission's staff alleges
that in September 1998, TKO and Turano contracted to
promote at least four microcap companies in exchange for
cash and/or options to purchase shares of the companies'
stock. TKO and Turano then promoted those companies to
investors through the Internet without disclosing the
amount of the cash or stock options, in violation of
Section 17(b) of the Securities Act of 1933, which
requires that the publicist disclose the amount of
compensation received from a public company.
TKO is a closely held Colorado corporation with its
place of business in Englewood, Colorado.
A hearing will be scheduled to determine whether the
allegations are true and, if so, whether a cease-and-
desist order should be issued. (Rel. No. 33- ).
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