Securities Law Prof Blog

Editor: Eric C. Chaffee
Univ. of Toledo College of Law

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Thursday, February 12, 2009

SEC Enjoins Meridian Holdings from Fraud, Books & Records Violations

The SEC announced today that the United States District Court for the Central District of California entered final judgments, by consent, permanently enjoining Meridian Holdings, Inc. ("Meridian"), Anthony C. Dike ("Dike") and Michelle V. Nguyen ("Nguyen") from future violations of Sections 10(b), 13(a) and 13(b)(2)(A) of the Securities Exchange Act of 1934 and Rules 10b-5, 12b-20 and 13a-13 thereunder. In addition, both Meridian and Dike were permanently enjoined from future violations of Section 302(b) of Regulation S-T, and Dike was further permanently enjoined from future violations of Exchange Rule 13a-14. Dike was also ordered to pay a civil penalty in the amount of $25,000, and is prohibited for five years from the date of the judgment from acting as an officer or director of a public company. Nguyen was ordered to pay a civil penalty in the amount of $15,000 and, in a separate administrative proceeding, was suspended from appearing or practicing before the Commission as an accountant, with the right to request reinstatement after three years.

Meridian, which was located in Culver City, California, owned interests in companies that engage in e-commerce in the medical industry, and provided management services to those companies. The Commission's complaint, filed on September 28, 2007, alleged that the financial statements filed with Meridian's 2004 second and third quarter reports caused Meridian to materially overstate it assets and represent it had significant gains, when, in fact, it should have reported losses. Meridian also backdated officer certifications required by the Sarbanes-Oxley Act, the Commission alleged.  On October 30, 2009, Meridian filed with the Commission a certification and notice of termination of its registration under Section 12(g) of the Exchange Act.

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