Securities Law Prof Blog

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

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Wednesday, August 12, 2009

Florida Attorney Settles SEC Market Manipulation Charges

On July 31, 2009, the SEC filed a civil action in the United States District Court for the Southern District of Florida against L. Daniel Ferrer, a Florida attorney, alleging violations of the federal securities laws in connection with the manipulation of stock in Weida Communications, Inc.  According to the SEC’s complaint, from approximately June 2004 through April 2005, a group of promoters and brokers manipulated the market price for Weida common stock to approximately $5 per share in part to facilitate the sale of stock in private transactions for approximately $3 per share. The SEC alleges Ferrer used brokerage accounts opened in his name and that of his law firm to execute manipulative trades in Weida common stock. Ferrer was an attorney licensed to practice law in the State of Florida and outside counsel for Weida. The SEC further alleges that Ferrer falsely testified under oath when questioned by the staff about his trading activity during the investigation. The SEC charges Ferrer with violations of Section 10(b) Securities Exchange Act of 1934 (“Exchange Act”) and Rule 10b-5 thereunder and seeks as relief a permanent injunction, disgorgement with prejudgment interest, a civil penalty and penny stock bar. Without admitting or denying the allegations against him, Ferrer consented to a permanent injunction and penny stock bar. Ferrer also consented to an administrative order permanently suspending his privilege of appearing or practicing before the SEC as an attorney.

On April 6, 2009, Ferrer was arrested on related criminal charges brought by the United States Attorney’s Office for the Southern District of Florida [United States of America v. L. Daniel Ferrer, Case No. 09-60069-CR (Cohen J/Seltzer MJ)]. On May 19, 2009, Ferrer pleaded guilty to misprision of a felony pursuant to 18 U.S.C. § 4. Ferrer’s sentencing is scheduled for August 27, 2009.

http://lawprofessors.typepad.com/securities/2009/08/florida-attorney-settles-sec-market-manipulation-charges.html

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