Page 8 - 2013_2014 NASAA report

NASAA Member Activity | U.S.
NASAA Activity Report 13-14.indd
6
Connecticut Securities and Business Investments Division
In March 2013, fve employees in the Division were honored by the U. S. Attorney s Ofce
for the District of Connecticut for their investigative eforts in signifcant federal criminal
prosecutions and civil cases in Connecticut over the past year. Te employees received
recognition based on two cases. In U.S. v. Stephen Blankenship, an investment adviser pleaded
guilty to defrauding investors of about $600,000, was sentenced to 41 months incarceration
and ordered to make restitution to his victims. Te U.S. Attorney s Ofce considered this
case to be a text-book example of the efectiveness of coordination and teamwork among
local, state and federal members of the Securities Fraud Task Force. In U.S. v. Robin Brass,
a victim complaint to the Division initiated a federal investigation. Te defendant was found
guilty of stealing nearly $2 million from her victims, many elderly and infrm, in a Ponzi
scheme and was sentenced to 96 months imprisonment.
Delaware Department of Justice, Securities Division
Te Division obtained an indictment charging a New Castle County man with theft,
securities fraud, and tax evasion following its investigation of a scheme to defraud investors of
nearly $1 million in a case involving an unregistered agent selling unregistered securities. Te
man also was charged with fve counts of income tax evasion for failing to fle an income tax
return or pay state income taxes from 2006 through 2010 on more than $1.3 million dollars
in taxable income.
District of Columbia Department of Insurance, Securities and Banking
At the request of the Department (DISB), the District of Columbia City Council
enacted the DISB Fingerprint-Based Background Check Authorization Act of 2012,
which authorized DISB to require license applicants to submit their fngerprints to
the Department so that it could request the FBI conduct Criminal History Background
Checks on applicants who were not already fngerprinted primarily investment adviser
representatives and a small category known as Agents of Issuers. Applicants for broker-
dealer agent licenses are fngerprinted as part of the FINRA licensing process. In 2013,
DISB took all the major steps toward full implementation of the legislation. DISB is one of
a handful of U.S. jurisdictions that requires all securities license applicants to submit their
fngerprints as part of the licensing process.
Florida Office of Financial Regulation
Te Ofce was successful in obtaining preliminary injunctions and the appointment of a
receiver in two distinct investment fraud schemes targeting senior citizens with promises
of safe investments that paid a fxed, above market rate return. Tese cases involved about
$25 million invested by over 300 victims. Most of the money raised is alleged to have been
misappropriated or used to pay returns to investors in a Ponzi-like fashion. Te Ofce
continues to work with law enforcement as needed to ensure the perpetrators of these
schemes are criminally prosecuted.
8 4/30/2014 2:30:47 PM