SEC CHARGES PETER LYBRAND (F/K/A) PETER TOSTO WITH MARKET MANIPULATION
The Commission today filed a complaint against Peter C. Lybrand, formerly known as Peter C. Tosto, charging him, and three other persons, with securities fraud and selling unregistered securities in a complex market manipulation that netted the defendants a total of over $12 million. The complaint charges that, from June 1998 through January 1999, Lybrand manipulated the securities of three shell companies: Polus, Inc., Citron, Inc., and Electronic Transfer Associates Inc. (ETA), and that he sold securities of those companies in unregistered transactions. The complaint alleges that Lybrand carried out this scheme through eight foreign entities and three domestic entities that he controlled and/or owned, all of which are also named as defendants in today's action.
In today's action, the Commission also charged Richard S. Kern, of Aurora, Colorado, his brother Donald R. Kern, also of Aurora, and Charles Wilkins, of Scottsdale, Arizona, alleging that they too sold the stock of the shell companies in unregistered transactions and aided and abetted Lybrand's manipulation by participating in matched transactions. Finally, the complaint also charges five entities associated with the Kerns and Wilkins (EFI Corp, Barclay Bankcard, Inc., Canyon Vista Corp., and Salteaux Ltd.) with selling unregistered securities.
The Commission charges that Lybrand's conduct violated Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder. He and his entities also sold the shell companies' securities in violation of Section 5 of the Securities Act, the registration provision of the federal securities laws. For their part, the Kerns and Wilkins are charged with violations of Section 5 of the Securities Act, and with aiding and abetting Lybrand's violations of Section 10(b) of the Exchange Act, and Rule 10b-5. The relief sought by the Commission in this action includes permanent injunctions against future violations, disgorgement and civil penalties. [SEC v. Peter C. Lybrand, f/k/a Peter C. Tosto, Richard S. Kern, Donald R. Kern, Charles Wilkins, Admiral Investments Ltd., Compulink International Corp., Drawbridge Investments Ltd., Glittergrove Investments Ltd., Grafton Investments Ltd., Greeenford Investments Ltd., McDonalds Ltd., Oasis Enterprises Ltd., Investor Relations, Inc., Tellerstock, Inc., Conversant Enterprises, Inc., EFI CORP. a/k/a Electronic Funds, Inc., Barclay Bankcard, Inc., Canyon Vista Corp., and Salteaux Ltd. a/k/a First American Security Corp. a/k/a First American Securities Corp., Defendants, and Hannah G Irrevocable Trust and Hannah R Trust, Relief Defendants, U.S. District Court for the Southern District of New York, 00 Civ. 1387, SDNY] (LR-16448)
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