Securities and Exchange Commission v. Vassallo et al

Filing 365

ORDER signed by Senior Judge Lawrence K. Karlton on 10/25/2010 GRANTING Receiver Stephen E. Anderson's #340 Disgorgement Motion for Order directing Wells Fargo Bank to release all funds in USR Site Acquisition, LLC savings account. (Marciel, M)

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Securities and Exchange Commission v. Vassallo et al Doc. 365 1 FUTTERMAN DUPREE DODD CROLEY MAIER LLP JAMIE L. DUPREE (158105) 2 JAIME G. TOUCHSTONE (233187) 180 Sansome Street, 17th Floor 3 San Francisco, CA 94104 Telephone: (415) 399-3840 4 Facsimile: (415) 399-3838 jdupree@fddcm.com 5 jtouchstone@fddcm.com 6 Attorneys for Receiver Stephen E. Anderson 7 8 9 10 11 SECURITIES AND EXCHANGE COMMISSION, 12 Plaintiff v. 13 ANTHONY VASSALLO, et al, 14 Defendants. 15 16 17 18 19 20 The disgorgement motion of Receiver Stephen E. Anderson ("Receiver") directing Wells UNITED STATES DISTRICT COURT EASTERN DISTRICT OF CALIFORNIA SACRAMENTO Case No. CV 09-000665 LKK-DAD ORDER GRANTING RECEIVER'S DISGORGEMENT MOTION FOR ORDER DIRECTING WELLS FARGO BANK TO RELEASE TO RECEIVER ALL FUNDS IN USR SITE ACQUISITION, LLC SAVINGS ACCOUNT Date: Time: Location: Judge: October 25, 2010 10:00 a.m. Courtroom 4, 15th Floor Hon. Lawrence K. Karlton 21 Fargo Bank to release to Receiver all funds contained in Wells Fargo Business Performance 22 Savings Account Number XXX-XXX7703, in the name of USR Site Acquisition, LLC ("USR 23 Savings Account"), came on regularly for hearing in Courtroom 4 of the above-entitled Court on 24 October 25, 2010, at 10:00 a.m., the Honorable Lawrence K. Karlton presiding, with counsel 25 appearing on behalf of Receiver. The Court having considered the papers submitted in support 26 of and in opposition to such motion, and the arguments of counsel and for good cause shown, 27 28 FUTTERMAN DUPREE DODD CROLEY MAIER LLP 1 [PROPOSED] ORDER GRANTING DISGORGEMENT MOTION FOR ORDER DIRECTING WELLS FARGO TO RELEASE FUNDS CASE NO. CV 09-000665 LKK-DAD Dockets.Justia.com 1 2 THE COURT FINDS AND ORDERS AS FOLLOWS: Adequate and fair notice of this disgorgement motion was provided to USR Site 3 Acquisition, LLC and Charles "Charlie" Jarvis ("Jarvis") pursuant to the Court's August 20, 4 2009 Order. 5 Two million dollars ($2,000,000) of Equity Investment Management and Trading, Inc. 6 ("EIMT") investor funds were transferred by EIMT to Jeff Dennis Ferentz ("Ferentz") in 7 connection with a purported "bank sanctioned high yield funding program." Of that $2 million, 8 $591,500 in EIMT investor funds was transferred to a Wells Fargo Business Checking Account 9 Number XXX-XXX7037, in the name of USR Site Acquisition, Inc. ("USR Checking 10 Account"), on which Jarvis was an authorized signatory. EIMT investor funds were then 11 transferred from the USR Checking Account to the USR Savings Account, on which Jarvis was 12 also an authorized signatory. Ferentz died in June 2008. 13 Other than interest, no funds have been deposited in the USR Savings Account since 14 November 2007. Jarvis has used the funds in the USR Savings Account to pay for personal 15 expenses. 16 This Court issued an order on April 21, 2010 (Doc. No. 259) (the "April 21, 2010 17 Order") freezing the USR Saving Account, which had a balance of $168,055.45 as of March 31, 18 2010. 19 There was no legitimate business reason for the transfer of $2 million in EIMT investor 20 funds to Ferentz, the subsequent transfer of EIMT investor funds to the URS Checking Account, 21 or the subsequent transfer of EIMT investor funds to the USR Savings Account, EIMT obtained 22 no benefit from the purported "bank sanctioned high yield funding program." Although 23 Receiver has demanded return of the EIMT investor funds under the control of Jarvis in the USR 24 Savings Account, Jarvis has refused to return the funds to Receiver. 25 All of the money contained in the USR Savings Account is held in constructive trust for 26 EIMT for the benefit of its investors. Therefore, Receiver's motion is hereby GRANTED. 27 Wells Fargo Bank is directed to immediately release to Receiver Stephen E. Anderson all 28 funds in Wells Fargo Business Performance Savings Account Number XXX-XXX7703, in the FUTTERMAN DUPREE 2 DODD CROLEY MAIER LLP [PROPOSED] ORDER GRANTING DISGORGEMENT MOTION FOR ORDER DIRECTING WELLS FARGO TO RELEASE FUNDS CASE NO. CV 09-000665 LKK-DAD 1 name of USR Site Acquisition, LLC, frozen by the April 21, 2010 Court Order, and shall remit 2 to Receiver any interest earned on such funds during the time the funds were frozen by the April 3 21, 2010 Court Order. 4 5 6 Dated: October 25, 2010 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 FUTTERMAN DUPREE DODD CROLEY MAIER LLP IT IS SO ORDERED. 3 [PROPOSED] ORDER GRANTING DISGORGEMENT MOTION FOR ORDER DIRECTING WELLS FARGO TO RELEASE FUNDS CASE NO. CV 09-000665 LKK-DAD

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