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SEC Charges Penny-Stock Operators in Push to Crack Down on Repeat Offenders.

Article By : Patrick Mansfield | U.S. Consumer Finance
SEC Charges Penny Stock Fraud

The Securities and Exchange Commission has recently been looking for ways of making sure repeat offenders in penny stocks cases are charged in local courts, to halt the trade in patents which do not exist. The SEC believes the issue of penny stock companies reporting patents to customers which do not exist, is an ongoing part of the battle to reduce the number of fraud cases taking place in the U.S. markets. 

In response to the continuing issue of penny stock traders returning to the patent trading markets, some repeat offenders have recently been targeted for thier role, they continue to play in the development of this controversial market. Two of these repeat offenders were recently taken to court by the legal department of the SEC. To halt what the Securities and Exchange Commission believes to be a fraudulent business model, where non-existent patents are reported to be owned by an investment company, which will later result in major profits. The latest two cases to be taken to court by the SEC saw Rockey "Roc" G. Hatfield and Steve E. Lovern charged with a SEC complaint in the U.S. District Court for the Southern District of Florida.

The role still being played on the penny stocks markets by Hatfield is seen as one for major concern according to SEC officials as he has already been barred from taking part in the penny stocks trade and a number of other financial markets. In his bid to continue trading the SEC alleges Hatfield registered his most recent companies by registering them under the name of his wife and an associate, Steve E. Lovern of Atlanta, Georgia front the companies he was using to allegedly defraud those who fell for the scripted calls made on his behalf.

The SEC alleges Rockey Hatfield was also employing non-professional people to cold call potential customers who were given a prepared pith written by Hatfield himself as he mad a pitch regarding profits available on non-existent patents. As part of the pitch made by Hatfield's employs the SEC alleges potential investors were told an initial investment of around $80,000 could result in a payoff of an estimated $1 million.

A major move towards handling the often illegal practices of penny stock operators has been an ongoing issue for the SEC, an organization which has been at the heart of some charges filed against different companies and CEO's using unfair practices. In September 2016, the SEC charged Craig V. Sizer of Sanomedics Inc. with pressuring seniors and vulnerable persons into making penny stock trades allegedly with no chance of achieving a profit or in patents which did not exist. 

By seeking out repeat offenders using boiler room and alleged fake patents the SEC has begun a new Recidivist Initiative headquartered in its Miami regional office headed by Eric I. Bustillo. In implementing a recidivist program at the Miami Regional Office, it is hoped the instances of repeat offenders will be reduced across the state.
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