Securities and Exchange Commission v. Bryant et al
Filing
188
MEMORANDUM OPINION AND ORDER. The Court finds that motions 184 and 185 should be denied. Signed by District Judge Amos L. Mazzant, III on 4/18/2018. (rpc, )
United States District Court
EASTERN DISTRICT OF TEXAS
SHERMAN DIVISION
SECURITIES AND EXCHANGE
COMMISSION
v.
THURMAN P. BRYANT III, BRYANT
UNITED CAPITAL FUNDING, INC.,
ARTHUR F. WAMMEL, WAMMEL
GROUP, LLC, THURMAN P. BRYANT
JR., and CARLOS GOODSPEED
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Civil Action No. 4:17-CV-00336
Judge Mazzant
MEMORANDUM OPINION AND ORDER
Pending before the Court is Brandi Bryant’s Motion for Order pursuant to Customer
Challenge Provision of the Right to Financial Prviacy Act of 1978 (Dkt. #184) and Motion to
Quash Subpoena, or in the Alternative, for a Protective Order (Dkt. #185). The Court finds that
both motions should be denied.
BACKGROUND
On May 15, 2017, the Securities and Exchange Commission (“SEC”) filed a complaint
against Defendants alleging securities fraud in connection with a series of interrelated Ponzi
schemes (Dkt. #1). On May 15, 2017, the Court entered an order appointing a receiver over Bryant
and Bryant Capital (“Receivership Order”) (Dkt. #17). The Receivership Order gave Receiver
exclusive jurisdiction to marshal, conserve, hold, and operate all of the Defendants’ assets. Also
on May 15, 2017, the Court entered an temporary restraining order enjoining the Bryant
Defendants from violating the antifraud provisions of the federal securities laws and freezing their
assets (“Asset Freeze Order”) (Dtk. #16).
On January 26, 2018, the SEC filed its First Amended Complaint naming Carlos
Goodspeed (“Goodspeed”) as a primary defendant (Dkt. #154). The SEC recently obtained bank
records for a bank account held by Goodspeed at Bank of America, N.A. Those records indicate
that well after the Court issued its Asset Freeze Order and Receivership Order, Goodspeed made
multiple wire transfers to a Capital One Account held in the name of Brandi Bryant (“Mrs.
Bryant”).
On April 4, 2018, the SEC served Capital One with a subpoena (the “Subpoena”), which
sought, among other documents, account opening records, account statements, checks and
deposits, wire transfer details, and signature cards for the Capital One Account. On April 9, 2018,
Mrs. Bryant filed a motion for an order pursuant to Customer Challenge Provision of the Right to
Financial Prviacy Act of 1978 (“RFPA”) (Dkt. #184). On April 11, 2018, Mrs. Bryant filed a
motion to quash (Dkt. #185). On April 11, 2018, the SEC filed a response in opposition to Mrs.
Bryant’s RFPA motion (Dkt. #186).
ANALYSIS
Under the RFPA, the Court must deny a customer challenge to a subpoena issued pursuant
to the RFPA if the Government establishes the relevance of the validly subpoenaed documents to
a legitimate law enforcement inquiry. 12 U.S.C. 3410(c). See Sandsend Financial Consultants, Ltd
v. Federal Home Loan Bank Board, 878 F.2d 875, 877 (5th Cir. 1989) (“Upon finding that there
is a demonstrable reason to believe that the agency is conducting a legitimate law enforcement
inquiry and that the records sought are relevant to that inquiry, the court ‘shall deny the motion to
quash.’”) (quoting 12 U.S.C. 3410(c) (emphasis in original)).
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The Court finds that the SEC has demonstrated that its investigation is a legitimate law
enforcement inquiry and the subpoenaed records are relevant to the SEC’s investigation. It is
therefore ORDERED that Brandi Bryant’s motion to quash is DENIED.
SIGNED this 18th day of April, 2018.
___________________________________
AMOS L. MAZZANT
UNITED STATES DISTRICT JUDGE
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