(3/12/99) JOSEPH AND CONSTANCE PIGNATIELLO ORDERED TO PAY $3.5 MILLION IN CONNECTION WITH AQUA BUOY FINANCIAL FRAUD
The United States District Court for the District of New Jersey
issued a final judgment against defendants Joseph and Constance
Pignatiello (the Pignatiellos) and: (1) permanently enjoined the
Pignatiellos from violating the federal securities laws; (2) ordered
the Pignatiellos to pay disgorgement of $2,106,185.14 and to pay
prejudgment interest of $1,398,641.98; (3) permanently enjoined
Joseph Pignatiello from serving as an officer or director of a
public company; and (4) enjoined Constance Pignatiello from serving
as an officer or director of a public company for five years.
Judgment was entered on February 22, 1999, after the Court granted
the Commission's motion for summary judgment.
The Court found that the Pignatiellos, former officers of Aqua Buoy
Corporation (Aqua Buoy), now known as Chester Holdings, Ltd.,
violated Section 17(a) of the Securities Act of 1933, Section 10(b)
of the Securities Exchange Act of 1934 (Exchange Act) and Rule 10b-5
thereunder, and Section 20(a) of the Exchange Act when they made
false public statements concerning the Aqua Buoy's financial
condition and sold their own Aqua Buoy stock at inflated prices.
Previously, on August 8, 1997, the Court entered a final judgment by
consent against Aqua Buoy, which consented to the entry of the
judgment without admitting or denying the allegations in the
complaint and was permanently enjoined from violating the antifraud
provisions, Section 10(b) of the Exchange Act and Rule 10b-5, and
Section 13(a) of the Exchange Act and Rules 12b-20, 13a-1, 13a-11,
and 13a-13. Also, on October 8, 1998, the Court entered a final
judgment by consent against Werner, who consented to the entry of
the judgment without admitting or denying the allegations in the
complaint and was permanently enjoined from violating the antifraud
provisions, Section 10(b) of the Exchange Act and Rule 10b-5,
Section 20(a) of the Exchange Act, and Section 17(a) of the
Securities Act, and ordered to disgorge $74,625.00 and pay
$43,020.42 in prejudgment interest. Payment of the disgorgement and
prejudgment interest was waived, and the Court did not impose civil
penalties, based on Werner's demonstrated inability to pay. [SEC v.
Chester Holdings, Ltd., formerly named Aqua Buoy Corporation, Joseph
Pignatiello, Constance Pignatiello and Christopher Werner, 97 Civ.
1654, D. N.J., MTB] (LR-16084)
sec.gov |
