Tuesday, March 31, 2009
On March 30, 2009, the United States District Court for the Southern District of New York entered a partial consent judgment against defendant Pinchus Gold, of Brooklyn, New York, in an action filed in February by the SEC. Without admitting or denying the allegations of the Commission's complaint, Gold consented to the entry of judgment that permanently enjoins him from further violation of the anti-fraud and registration provisions of the federal securities laws. The judgment further provides that Gold will disgorge his ill-gotten gains and prejudgment interest in an amount to be determined by the Court, and that Gold will be subject to a civil penalty in an amount to be determined by the Court.
The Commission's complaint alleges that Gold and others made material misrepresentations to the transfer agent for Forest Resources Management Corp. in order to obtain millions of restricted shares without the required restricted legend. A registration statement was never in effect for the shares issued to Gold and his nominees. Gold and his nominees then sold these unlegended shares on the open market, falsely holding them out to the investing public as free-trading shares, when in fact they were restricted stock. Gold received nearly $600,000 from the improper sale of these shares.
The litigation is continuing against the remaining defendants.