Legal
SEC

Criminal Charges, $44M in Penalties for Tiger Asia Management

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Funds managed by Tiger Asia Management engaged in illegal short selling of shares in private placements of two Chinese companies, according to a civil suit against Tiger founder Sung Kook "Bill" Hwang and head trader Raymond Park. The pair has agreed to pay $44 million to settle the Securities and Exchange Commission suit, and the U.S. Attorney's Office for the District of New Jersey announced criminal charges against Tiger. The actions were filed in the Newark, N.J., U.S. District Court. The SEC suit alleges that New York-based Tiger manipulated prices and illegally sold short and covered with shares obtained in the placements, which required investors not to engage in short selling. The activity took place around placements of China Bank and China Construction Bank stock, which trade on the Hong Kong stock exchange.

Legal
CYXI

SEC Targets Chinese Reverse Merger Maven Zhou

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Reverse merger advisor Huakang “David” Zhou manipulated markets and dissipated funds from financings, according to a suit filed by the Securities and Exchange Commission. The suit claims Zhou's work with now defunct China Yingxia International and other companies illustrates how Zhou stole cash from unregistered offerings, manipulated share prices, sought to evade Chinese currency transfer laws, and used subterfuges to create the illusion of a shareholder base suitable for listing. The suit was filed Dec. 11 in a New York City U.S. District Court. Zhou also duped investors in American Nano Silicon Technologies (ANNO), the SEC claims. "Zhou misused a significant portion of the investment proceeds to pay $271,500 towards a mortgage on a million dollar condo in New York City and a $40,000 'refund' to his wife for undisclosed reasons."

Legal
Magnum d'Or

Magnum d’Or Announced Fake PIPE, SEC Claims

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Tire recycler Magnum d'Or Resources (MDOR) ran into double trouble with consulting regulations when it pumped its stock with misleading press releases and illegally channeled money from stock sales back to the company, according to a suit filed by regulators. The Securities and Exchange Commission has announced that a U.S. District Court has ordered two of the consultants to pay over $6 million in disgorgement and penalties for their involvement in a stock price manipulation scheme. The Securities and Exchange Commission filed suit against recycling business Magnum last year for running afoul of S-8 regulations for the issuance of stock to consultants. Magnum tapped the PIPE market three times in 2008 through 2010, raising $19.5 million in convertible note transactions according to PlacementTracker data. However, the SEC claims one of the PIPEs may not have actually taken place.

Legal

Octagon Principal Settles Insider PIPE Trading Case

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Octagon Capital Partners principal Steven Hart agreed to a $1.3 million settlement after regulators accused him of insider trading and sham trading involving PIPE issuers and other companies. In settling with the Securities and Exchange Commission, Hart did not dispute allegations that he generated gains with matched trades causing losses to another fund and violated confidentiality in numerous securities deals. New York-based Octagon has invested $5.4 million in twenty PIPEs since 2011 according to PlacementTracker, most recently in a LightPath Technologies (LPTH) deal this June. The commission's suit was filed in Manhattan's U.S. District Court on Dec. 11.