United States Securities and Exchange Commission v. Western International Securities, Inc. et al, No. 2:2022cv04119 - Document 133 (C.D. Cal. 2024)
Court Description: FINAL JUDGMENT AS TO DEFENDANT WESTERN INTERNATIONAL SECURITIES, INC. by Judge Wesley L. Hsu in favor of United States Securities and Exchange Commission against Western International Securities, Inc.: IT IS HEREBY ORDERED, ADJUDGED, AND DECREED th at Defendant is permanently restrained and enjoined. Defendant shall satisfy this obligation by paying $196,468.63 to the Securities and Exchange Commission within 30 days after entry of this Final Judgment. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that this Court shall retain jurisdiction of this matter for the purposes of enforcing the terms of this Final Judgment. (see document for further details) Related to: NOTICE OF MOTION AND MOTION for Judgment by Consent 129 . (bm)
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United States Securities and Exchange Commission v. Western International Securities, Inc. et al Doc. 133 1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA 8 9 10 11 12 13 14 15 16 17 UNITED STATES SECURITIES AND EXCHANGE COMMISSION, Case No. 2:22-cv-04119-WLH-JCx Plaintiff, v. WESTERN INTERNATIONAL SECURITIES, INC., NANCY COLE, PATRICK EGAN, ANDY GITIPITYAPON, STEVEN GRAHAM, and THOMAS SWAN, Defendants, 18 19 20 FINAL JUDGMENT AS TO DEFENDANT WESTERN INTERNATIONAL SECURITIES, INC. The Securities and Exchange Commission (“Commission”) having filed a 21 22 Complaint and Defendant Western International Securities, Inc. (“Western” or 23 “Defendant”) having entered a general appearance; consented to the Court’s 24 jurisdiction over Defendant and the subject matter of this action; consented to entry 25 26 of this Final Judgment without admitting or denying the allegations of the Complaint 27 (except as to jurisdiction); waived findings of fact and conclusions of law; and 28 Final Judgment of Defendant Western International Securities, Inc. 1 Case No. 2:22-cv-04119-WLH-JCx Dockets.Justia.com 1 waived any right to appeal from this Final Judgment: 2 I. 3 4 5 6 IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that Defendant is permanently restrained and enjoined from violating, directly or indirectly, Rule 15l1(a)(1) of the Securities Exchange Act of 1934 (the “Exchange Act”) [15 CFR § 7 8 240.15l-1(a)(1)], by failing, when making a recommendation of any securities 9 transaction or investment strategy involving securities to a retail customer, to act in 10 the best interest of the retail customer at the time the recommendation is made, 11 12 without placing its financial or other interest ahead of the interest of the retail 13 customer. 14 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as 15 16 provided in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also 17 binds the following who receive actual notice of this Final Judgment by personal 18 service or otherwise: (a) Defendant’s officers, agents, servants, employees, and 19 20 attorneys; and (b) other persons who are in active concert or participation with 21 Defendant or with anyone described in (a). 22 II. 23 24 IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that 25 26 27 28 Defendant is liable for disgorgement of $34,468, representing net profits gained as a result of conduct alleged in the Complaint, together with prejudgment interest thereon in the amount of $2,000.63, and a civil penalty in the amount of $160,000 Final Judgment of Defendant Western International Securities, Inc. 2 Case No. 2:22-cv-04119-WLH-JCx 1 2 pursuant to Sections 21(d)(3), (5), and (7) of the Exchange Act [15 U.S.C. §§ 78u(d)(3), (5), (7)]. Defendant shall satisfy this obligation by paying $196,468.63 to 3 4 5 6 the Securities and Exchange Commission within 30 days after entry of this Final Judgment. Defendant may transmit payment electronically to the Commission, which will 7 8 provide detailed ACH transfer/Fedwire instructions upon request. Payment may also 9 be made directly from a bank account via Pay.gov through the SEC website at 10 http://www.sec.gov/about/offices/ofm.htm. Defendant may also pay by certified 11 12 check, bank cashier’s check, or United States postal money order payable to the 13 Securities and Exchange Commission, which shall be delivered or mailed to 14 15 16 Enterprise Services Center Accounts Receivable Branch 6500 South MacArthur Boulevard Oklahoma City, OK 73169 17 and shall be accompanied by a letter identifying the case title, civil action number, 18 and name of this Court; Western International Securities, Inc. as a defendant in this 19 20 21 22 action; and specifying that payment is made pursuant to this Final Judgment. Defendant shall simultaneously transmit photocopies of evidence of payment and case identifying information to the Commission’s counsel in this action. By 23 24 25 26 making this payment, Defendant relinquishes all legal and equitable right, title, and interest in such funds and no part of the funds shall be returned to Defendant. The Commission may enforce the Court’s judgment for disgorgement and 27 28 prejudgment interest by using all collection procedures authorized by law, including, Final Judgment of Defendant Western International Securities, Inc. 3 Case No. 2:22-cv-04119-WLH-JCx 1 2 but not limited to, moving for civil contempt at any time after 30 days following entry of this Final Judgment. 3 4 5 6 The Commission may enforce the Court’s judgment for penalties by the use of all collection procedures authorized by law, including the Federal Debt Collection Procedures Act, 28 U.S.C. § 3001 et seq., and moving for civil contempt for the 7 8 violation of any Court orders issued in this action. Defendant shall pay post 9 judgment interest on any amounts due after 30 days of the entry of this Final 10 Judgment pursuant to 28 U.S.C. § 1961. 11 12 13 14 The Commission shall hold the funds, together with any interest and income earned thereon (collectively, the “Fund”), pending further order of the Court. The Commission may propose a plan to distribute the Fund subject to the 15 16 Court’s approval. Such a plan may provide that the Fund shall be distributed 17 pursuant to the Fair Fund provisions of Section 308(a) of the Sarbanes-Oxley Act of 18 2002. The Court shall retain jurisdiction over the administration of any distribution 19 20 21 22 23 of the Fund and the Fund may only be disbursed pursuant to an Order of the Court. Regardless of whether any such Fair Fund distribution is made, amounts ordered to be paid as civil penalties pursuant to this Judgment shall be treated as 24 penalties paid to the government for all purposes, including all tax purposes. To 25 preserve the deterrent effect of the civil penalty, Defendant shall not, after offset or 26 27 28 reduction of any award of compensatory damages in any Related Investor Action based on Defendant’s payment of disgorgement in this action, argue that it is entitled Final Judgment of Defendant Western International Securities, Inc. 4 Case No. 2:22-cv-04119-WLH-JCx 1 2 to, nor shall it further benefit by, offset or reduction of such compensatory damages award by the amount of any part of Defendant’s payment of a civil penalty in this 3 4 5 6 action (“Penalty Offset”). If the court in any Related Investor Action grants such a Penalty Offset, Defendant shall, within 30 days after entry of a final order granting the Penalty Offset, notify the Commission’s counsel in this action and pay the amount 7 8 of the Penalty Offset to the United States Treasury or to a Fair Fund, as the 9 Commission directs. Such a payment shall not be deemed an additional civil penalty 10 and shall not be deemed to change the amount of the civil penalty imposed in this 11 12 Judgment. For purposes of this paragraph, a “Related Investor Action” means a 13 private damages action brought against Defendant by or on behalf of one or more 14 investors based on substantially the same facts as alleged in the Complaint in this 15 16 action. 17 18 19 III. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that the Consent executed by Defendant in connection with this Final Judgment is 20 21 incorporated herein with the same force and effect as if fully set forth herein, and that 22 Defendant shall comply with all of the undertakings and agreements set forth therein. 23 24 25 26 27 28 Final Judgment of Defendant Western International Securities, Inc. 5 Case No. 2:22-cv-04119-WLH-JCx 1 2 IV. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that this Court 3 4 5 shall retain jurisdiction of this matter for the purposes of enforcing the terms of this Final Judgment. 6 7 Dated: August 28, 2024 8 ______________________________________ HON. WESLEY L. HSU UNITED STATES DISTRICT JUDGE 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Final Judgment of Defendant Western International Securities, Inc. 6 Case No. 2:22-cv-04119-WLH-JCx
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