Securities And Exchange Commission v. Neufeld et al

Filing 16

MOTION by Plaintiff Securities And Exchange Commission for judgment AGREED OF PERMANENT INJUNCTIONS AND DISGORGEMENT (Attachments: # 1 Exhibit 1 - Text of Proposed Order, # 2 Exhibit 2- Consents of Defendants)(Shoenthal, Andrew)

Securities And Exchange Commission v. Neufeld et al

Doc. 16 Att. 2

EXHIBIT 2

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UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION SECURITIES AND EXCHANGE COMMISSION, Plaintiff, v. JEFFREY R. NEUFELD and PARIDON CAPITAL MANAGEMENT LLC f/k/a TRITONE CAPITAL MANAGEMENT, LLC Defendants. JUDGMENT FOR PERMANENT INJUNCTIONS AND DISGORGEMENT FOR DEFENDANTS The Securities and Exchange Commission (the "Commission") having filed a Complaint and Defendants Jeffrey R. Neufeld ("Neufeld") and Paridon Capital Management, LLC f/k/a Tritone Capital Management, LLC ("Paridon") (collectively, the "Defendants"), having entered general appearances; consented to the Court's jurisdiction over Defendants and the subject matter of this action; consented to entry of this Judgment without admitting or denying the allegations of the Complaint (except as to jurisdiction); waived findings of fact and conclusions of law; and waived any right to appeal from this Judgment: I. A. IT IS ORDERED that Defendants and Defendants' agents, servants, employees, Case No.: 10-CV-2399 Judge John F. Grady Magistrate Judge Nolan

attorneys, and all persons in active concert or participation with them who receive actual notice

of this Judgment by personal service or otherwise are restrained and enjoined from violating, directly or indirectly, Section 10(b) of the Securities Exchange Act of 1934 (the "Exchange Act") [15 U.S.C. § 78j(b)] and Rule 10b-5 promulgated thereunder [17 C.F.R. § 240.10b-5], by using any means or instrumentality of interstate commerce, or of the mails, or of any facility of any national securities exchange, in connection with the purchase or sale of any security: (a) (b) to employ any device, scheme, or artifice to defraud; to make any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading; or (c) to engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person. B. IT IS FURTHER ORDERED that Defendants and Defendants' agents, servants,

employees, attorneys, and all persons in active concert or participation with them who receive actual notice of this Judgment by personal service or otherwise are restrained and enjoined from violating Section 17(a) of the Securities Act of 1933 (the "Securities Act") [15 U.S.C. § 77q(a)] in the offer or sale of any security by the use of any means or instruments of transportation or communication in interstate commerce or by use of the mails, directly or indirectly: (a) (b) to employ any device, scheme, or artifice to defraud; to obtain money or property by means of any untrue statement of a material fact or any omission of a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading; or

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(c)

to engage in any transaction, practice, or course of business which operates or would operate as a fraud or deceit upon the purchaser.

C.

IT IS FURTHER ORDERED that Defendants and Defendants' agents, servants,

employees, attorneys, and those persons in active concert or participation with them, and each of them, are restrained and enjoined from violating Sections 206(1) and (2) of the Investment Advisers Act of 1940 ("Advisers Act") [15 U.S.C. § 80b-6(1) and (2)] by, while acting as an investment adviser, by the use of the means and instrumentalities of interstate commerce and of the mails, directly or indirectly, employing devices, schemes, and artifices to defraud its clients and prospective clients, or engaging in transactions, practices, and courses of business which operate as a fraud or deceit upon its clients and prospective clients. D. IT IS FURTHER ORDERED that Defendants and Defendants' agents, servants,

employees, attorneys, and those persons in active concert or participation with them, and each of them, are restrained and enjoined from violating Section 206(3) of the Advisers Act [15 U.S.C. § 80b-6(3)] by, while acting as an investment adviser, by the use of the means and instrumentalities of interstate commerce and of the mails, directly and indirectly, acting as a principal for their own account, knowingly to sell any security from a client, or acting as broker for a person other than such client, knowingly to effect any sale or purchase of any security for the accounts of such client, without disclosing to such client in writing before the completion of such transaction the capacity in which they are acting and obtaining the consent of the client to such transaction. E. IT IS FURTHER ORDERED that Defendants and Defendants' agents, servants,

employees, attorneys, and those persons in active concert or participation with them, and each of

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them, are restrained and enjoined from violating Section 206(4) of the Advisers Act [15 U.S.C. § 80b-6(4)] and Rule 206(4)-8 thereunder [17 C.F.R. § 275.206(4)-8] by, while acting as an investment adviser to a pooled investment vehicle, by the use of the means and instrumentalities of interstate commerce and of the mails, making untrue statements of material fact or omitting to state a material fact necessary to make the statements made, in light of the circumstances under which they were made, not misleading, to any investor or prospective investor in a pooled investment vehicle or otherwise engaging in acts, practices, or courses of business that are fraudulent, deceptive or manipulative with respect to any investor or prospective investor in a pooled investment vehicle. II. IT IS FURTHER ORDERED that Defendants are liable for disgorgement of $51,463.84, representing funds owed to John Evans ("Evans") an investor in the Paridon Currency Fund LP ("Currency Fund") as a result of the conduct alleged in the Complaint, together with prejudgment interest thereon in the amount of $1,718.49, for a total of $53,182.33. The Commission may enforce the Court's judgment for disgorgement and prejudgment interest by moving for civil contempt (and/or through other collection procedures authorized by law) at any time after 180 days following entry of this Judgment. In response to any such civil contempt motion by the Commission, the Defendants may assert any legally permissible defense. Payments under this paragraph shall be made by Defendants directly to Evans together with a cover letter identifying Defendants as defendants in this action; setting forth the title and civil action number of this action and the name of this Court; and specifying that payment is made pursuant to this Judgment. Defendants shall simultaneously transmit photocopies of such

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payment and letter to the Commission's counsel in this action. Defendants relinquish all legal and equitable right, title, and interest in such payments, and no part of the funds shall be returned to Defendants. Defendants shall pay post-judgment interest on any delinquent amounts pursuant to 28 USC § 1961. III. IT IS FURTHER ORDERED that the Consents are incorporated herein with the same force and effect as if fully set forth herein, and that Defendants shall comply with all of the undertakings and agreements set forth therein. IV. IT IS FURTHER ORDERED that this Court retains jurisdiction of this matter for the purposes of enforcing the terms of this Judgment. The Court also retains jurisdiction over the appropriateness and amount of a civil penalty. The parties shall try to resolve the issue of civil penalties, however if the parties cannot agree, the Court shall determine the appropriateness and amount of the civil penalty upon motion of a party. V. There being no just reason for delay, pursuant to Rule 54(b) of the Federal Rules of Civil Procedure, the Clerk is ordered to enter this Judgment forthwith and without further notice.

Dated: ______________, _____ ____________________________________ UNITED STATES DISTRICT JUDGE

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