Wednesday, July 18, 2012
The SEC announced that the Amish Helping Fund (AHF), a non-profit corporation that offers securities to fund mortgage and construction loans to young Amish families in Ohio, will ensure that its investors receive more timely and accurate information under a deferred prosecution agreement reached with the SEC. The SEC investigated the AHF, which was formed in 1995 by a group of Amish elders interested in furthering the Amish way of life, and alleges that AHF’s offering memorandum, drafted in 1995, was not updated for 15 years and thus contained material misrepresentations about the fund and the securities being offered.
The SEC release, however, goes on to state that:
Despite violating federal securities laws by disseminating a stale offering memorandum, the SEC found no evidence that AHF investors suffered any undue harm or investment losses as a result of these misrepresentations.
When informed of its alleged violations by the SEC, AHF immediately cooperated, updated its offering memorandum, and took other significant remedial steps in an expedited manner. Therefore, the SEC has entered into a Deferred Prosecution Agreement (DPA) and will not file an enforcement action against AHF provided it adheres to the provisions of the agreement. AHF is entering into a DPA with the SEC as part of the Cooperation Initiative the Enforcement Division announced in 2010 to facilitate and reward cooperation in SEC investigations.
Under the terms of the DPA, the SEC will refrain from filing an enforcement action against AHF if the company complies with certain undertakings. Among other things, AHF has updated and corrected its offering materials and agreed to register its new securities offerings and provide current investors with timely and accurate financial information.