US Securities and Exchange Commission v. New Futures Trading International Corporation et al

Filing 16

ORDER granting 12 Motion for Preliminary Injunction. So Ordered by Chief Judge Joseph N. Laplante.(cmp)

UNITED STATES DISTRICT COURT
DISTRICT OF NEW HAMPSHIRE

l,S

™'CTOFNEWHAMPSHIRE

DFC 0 7 2(111
SECURITIES AND EXCHANGE
COMMISSION,
Plaintiff,

Civil Action No. 11-CV-00532-JL

NEW FUTURES TRADING
INTERNATIONAL CORPORATION,
and HENRY ROCHE,
Defendants.

PRELIMINARY INJUNCTION FREEZING ASSETS
AND OTHER EQUITABLE RELIEF
Having considered the motion for a preliminary injunction freezing assets and other
equitable relief filed by plaintiff Securities and Exchange Commission ("the Commission"), as
well as the Complaint, the Commission's memorandum of law and accompanying evidentiary
materials, and argument, the Court finds that the Commission has made a proper prima facie
showing that: (1) defendants Henry Roche ("Roche") and New Futures Trading International
Corporation ("New Futures") have directly or indirectly engaged in the violations alleged in the
Complaint; (2) there is a reasonable likelihood that these violations will be repeated; (3) unless
restrained and enjoined by Order of this Court, Roche and New Futures may dissipate, conceal or
transfer from the jurisdiction of this Court assets which could be subject to an order of
disgorgement or an order to pay a civil monetary penalty in this action; and (4) entry of a
preliminary injunction freezing assets and other equitable relief, including an accounting and
repatriation of assets, is necessary to preserve the status quo. In consideration of the foregoing,

the Court being fully advised in the premises:

I.
IT IS HEREBY ORDERED that Roche and New Futures and each of their agents,
servants, employees and attorneys and those persons in active concert or participation with them
who receive actual notice of this Order by personal service or otherwise, including via facsimile
or email transmission, or overnight delivery service, are restrained from violating Section 17(a)
of the Securities Act of 1933 ("Securities Act") [15 U.S.C. § 77q(a)] by, directly or indirectly,
through the use of any means or instrumentalities of interstate commerce or the mails or of any
facility of any national securities exchange,
(a)

employing any device, scheme or artifice to defraud;

(b)

obtaining any money or property by means of any untrue statement of a material
fact or any omission 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)

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

in the offer or sale of any securities.

II.
IT IS HEREBY FURTHER ORDERED that Roche and New Futures and each of their
agents, servants, employees and attorneys and those persons in active concert or participation
with them who receive actual notice of this Order by personal service or otherwise, including via
facsimile or email transmission, or overnight delivery service, are restrained from violating
2

Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act") [15 U.S.C. § 78j(b)] and
Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5] by, directly or indirectly, through the use of the
means or instrumentalities of interstate commerce or of the mails or of any facility of any
national securities exchange,
(a)

employing any device, scheme or artifice to defraud;

(b)

making any untrue statement of a material fact or omitting 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)

engaging in any act, practice or course of business which operates or would
operate as a fraud or deceit upon any person,

in connection with the purchase or sale of any security.

III.
IT IS HEREBY FURTHER ORDERED that Roche and New Futures and each of their
agents, servants, employees and attorneys and those persons in active concert or participation
with them who receive actual notice of this Order by personal service or otherwise, including via
facsimile or email transmission, or overnight delivery service, are restrained from violating
Section 5 of the Securities Act [15 U.S.C. § 77e] by, directly or indirectly, in the absence of any
applicable exemption:
(a)

Unless a registration statement is in effect as to a security, making use of any
means or instruments of transportation or communication in interstate commerce
or of the mails to sell such security through the use or medium of any prospectus
or otherwise;
3

(b)

Unless a registration statement is in effect as to a security, carrying or causing to
be carried through the mails or in interstate commerce, by any means or
instruments of transportation, any such security for the purpose of sale or for
delivery after sale; or

(c)

Making use of any means or instruments of transportation or communication in

interstate commerce or of the mails to offer to sell or offer to buy through the use or medium of
any prospectus or otherwise any security, unless a registration statement has been filed with the
Commission as to such security, or while the registration statement is the subject of a refusal
order or stop order or (prior to the effective date of the registration statement) any public
proceeding or examination under Section 8 of the Securities Act [15 U.S.C. § 77h].

IV.
IT IS HEREBY FURTHER ORDERED that:
A.

Roche and New Futures and each of their agents, servants, employees and

attorneys and those persons in active concert or participation with them who receive actual notice
of this Order by personal service or otherwise, including via facsimile or email transmission, or
overnight delivery service, shall hold and retain funds and other assets of defendants presently
held by them, for their direct or indirect benefit, under their direct or indirect control or over
which they exercise actual or apparent investment or other authority, in whatever form such
assets may presently exist and wherever located, and shall prevent any withdrawal, sale, payment
(including, but not limited to, any charges on any credit card or draws on any other credit
arrangement), transfer, dissipation, assignment, pledge, alienation, encumbrance, disposal, or
diminution in value of any such funds or other assets, which are hereby frozen; and

4

B.

All banks, brokerage and other financial institutions (including but not limited to

Citizens Bank, Sovereign Bank, and Bank of America) and other persons or entities (including
but not limited to the following entities: Fingland Stables, Linda Adlof Ranch, Oswald Stallion
Station, Bob Loomis Quarter Horses, McQuay Stables, Rancho Oso Rio, Stoneride Farm,
Fappini Performance Horses, and Vallejo III, Inc.) which receive actual notice of this Order by
personal service or otherwise, including via facsimile or email transmission, or overnight
delivery service, holding any funds or other assets in the name, for the direct or indirect benefit,
or under the direct or indirect control of defendants or over which defendants exercise actual or
apparent investment or other authority, in whatever form such assets may presently exist and
wherever located, shall hold and retain within their control and prohibit the withdrawal, removal,
sale, payment (including, but not limited to, any charges on any credit card or draws on any other
credit arrangement), transfer, dissipation, assignment, pledge, alienation, encumbrance,
diminution in value, or other disposal of any such funds or other assets; and that such funds and
assets are hereby frozen.
C.

The above Paragraphs IV.A and IV.B shall immediately cease to apply to any

assets located within the United States, including any bank, brokerage or other financial
institution account, which becomes subject to any later order entered by any federal court as a
result of proceedings which may be filed by the United States or any department or agency
thereof under any federal civil or criminal forfeiture statute, to the extent such later order
requires the transfer of any asset to the United States government.

V.

5

IT IS HEREBY FURTHER ORDERED that all persons who hold or possess the direct
or indirect proceeds of the misconduct described in the Complaint, in whatever form such funds
or other assets may presently exist and wherever located, who receive actual notice of this Order,
by personal service or otherwise, including via facsimile or email transmission, or overnight
delivery service, shall hold and retain such funds and assets and shall prevent any withdrawal,
sale, payment (including, but not limited to, any charges on any credit card or draws on any other
credit arrangement), transfer, dissipation, assignment, pledge, alienation, encumbrance, disposal,
or diminution in value of any such funds or other assets, which are hereby frozen.

VI.
IT IS HEREBY FURTHER ORDERED that Roche and New Futures shall submit in
writing and serve upon the Commission, within five (5) business days following service of this
Order upon them, an accounting identifying:
1.

all transfers or payments of funds to them or any other entity controlled by them

from investors or clients in connection with the misconduct described in the Complaint (the
identification shall include the amount of each such transfer or payment, the date of the transfer
or payment, and the name, address, account number and financial institution of the party making
and the party receiving the transfer or payment);
2.

in detail, the precise disposition of each transfer or payment identified in response

to paragraph 1 above and all assets derived therefrom, including but not limited to:
a.

the nature and results of any investment in which the funds were used;

b.

any subsequent transfer or payment of the funds (the identification shall
include the amount of each such transfer or payment, the date of the

6

transfer or payment, the name, address, account number and financial
institution of the party making and receiving the transfer or payment, and
the reason for the transfer or payment); and
c.

any fees or expenses charged and a detailed statement of the nature and
purpose of such fees and expenses.

3.

by name and address, all persons, entities and accounts currently holding funds or

assets derived from the transfers or payments described in paragraph 1 above and the reason each
received the funds or assets (the identification shall include the amount each received, the date
received, the reason received, the institution and account number or location in which the funds
or other assets are held and the name, address, account number and financial institution of the
person or entity who provided each with the funds or other assets);
4.

assets of every type and description with a value of at least five hundred dollars

($500) presently owned by or held for the direct or indirect benefit, or subject to the direct or
indirect control, of Roche and New Futures, whether in the United States or elsewhere; and
5.

all accounts held at any bank, brokerage or other financial institution in the United

States or elsewhere in the name, for the direct or indirect benefit, or under the direct or indirect
control, of Roche or New Futures, or in which Roche or New Futures has or had any direct or
indirect beneficial interest, at any time from January 1, 2011 to the present.

VII.
IT IS HEREBY FURTHER ORDERED that Roche shall submit in writing to the
Commission, within three (3) business days following service of this Order upon him, a list of all
street and mailing addresses (including without limitation postal box numbers), telephone or

7

facsimile transmission numbers (including without limitation pagers and mobile telephones),
electronic mail addresses, safety deposit boxes, and storage facilities used by him or under his
direct or indirect control, at any time since January 1, 2011.

VIII.
IT IS HEREBY FURTHER ORDERED that Roche and New Futures and each of their
officers, agents, servants, employees and attorneys, and those persons in active concert or
participation with them who receive actual notice of this Order by personal service or otherwise,
including via facsimile or email transmission, or overnight delivery service, and each of them,
shall, within five (5) days of receiving actual notice of this Order, take such steps as are
necessary to repatriate and deposit into the registry of the Court in an interest bearing account,
any and all funds or assets that presently may be located outside of the United States that were
obtained directly or indirectly from investors.

IX.
IT IS HEREBY FURTHER ORDERED that Roche and New Futures and each of their
agents, servants, employees and attorneys and those persons in active concert or participation
with them who receive actual notice of this Order by personal service or otherwise, including via
facsimile or email transmission, or overnight delivery service, are hereby prohibited from
soliciting, accepting, or depositing any monies obtained from actual or prospective investors
pending the resolution of this action.

X.
IT IS HEREBY FURTHER ORDERED that Roche and New Futures and each of their
agents, servants, employees and attorneys and those persons in active concert or participation
8

with them who receive actual notice of this Order by personal service or otherwise, including via
facsimile or email transmission, or overnight delivery service, are hereby restrained from
destroying, mutilating, concealing, altering, disposing, or transferring custody of any items,
including but not limited to any books, records, documents, correspondence, contracts,
agreements, assignments, obligations, tape recordings, computer media or other property relating
to defendants or the misconduct described in the Complaint.

Chief Judge/J ose6h N. Laplante
UNITEIXSTAT/ES DISTRICT JUDGE

Dated: December

1
/

,2011

9