UNITED STATES OF AMERICA
SECURITIES AND EXCHANGE COMMISSION
Securities Exchange Act of 1934
Release No. 50348 / September 10, 2004
Administrative Proceeding File No. 3-11640
In the Matter of Allen Andrescu, Richard Brower, Mark Coates, Tejbir Singh, and Vikram Randhawa
The Securities and Exchange Commission ("Commission") announced today that it issued an Order Instituting Public Administrative Proceedings and Notice of Hearing Pursuant to Section 15(b) of the Securities Exchange Act of 1934 ("Order") against Allen Andrescu ("Andrescu"), Richard Brower ("Brower"), Mark Coates ("Coates"), Tejbir Singh ("Singh"), and Virkam Randhawa ("Randhawa") (collectively, the "Respondents"). In the Order, the Division of Enforcement alleges that: 1) on March 30, 2000, the Commission filed a civil injunctive action against the Respondents in SEC v. Renaissance Capital Management, Inc., et al., 00 Civ. 1848 (E.D.N.Y.) ("Injunctive Action") alleging that (a) from at least October 1997 to at least March 1999 the Respondents induced the investing public to buy at least $2.4 million worth of shares of stock issued by NNPD Textiles, Inc. ("NNPD"), a now-defunct New York corporation that was in the business of manufacturing sweaters; (b) that Respondents solicited investors through a series of false or misleading statements including, inter alia, that NNPD would be imminently conducting an IPO and investors could resell their private placement shares at a substantial profit; and (c) that Respondents distributed offering memoranda to investors even though Respondents knew or were reckless in not knowing that the offering memoranda contained material misstatements and omissions. The Commission's complaint charged that the Respondents violated Sections 5 and 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act"); 2) on April 17, 2001, the United States District Court for the Eastern District of New York ("District Court") granted the Commission's motion for summary judgment against Andrescu and Randhawa in the Injunctive Action, enjoining the Respondents from future violations of the antifraud and registration provisions of the securities laws. As a result of its findings, the Court permanently enjoined the Respondents from future violations of the antifraud and registration provisions of the securities laws and ordered Andrescu to disgorge $1,599,722.00 of ill-gotten gains derived from his fraudulent conduct, plus $277,969.00 in pre-judgment interest, and pay a civil penalty in the amount of $100,000.00. The same day the Court ordered Randhawa to pay $278,330.00, plus $48,363.00 in pre-judgment interest, and a $100,000.00 civil penalty; and 3) on March 29, 2003, the District Court in the Injunctive Action granted the Commission's application for summary judgment against Brower, Coates, and Singh enjoining the Respondents from future violations of the antifraud and registration provisions of the securities laws. On October 31, 2003, the District Court ordered Brower to disgorge $105,250.00 of ill-gotten gains derived from his fraudulent conduct, plus $53,536.53 in pre-judgment interest, and ordered Brower to pay a $105,520.00 civil penalty. The Court also ordered Coates to disgorge $26,650.00 of ill-gotten gains derived from his fraudulent conduct, plus $13,423.34 in pre-judgment interest, and ordered him to pay a $26,650.00 civil penalty; and ordered Singh to disgorge $10,000.00 of ill-gotten gains derived from his fraudulent conduct, plus $4,273.26 in pre-judgment interest, and ordered him to pay a $10,000.00 civil penalty.
A hearing will be scheduled before an administrative law judge to determine whether the allegations contained in the Order are true, to provide the Respondents an opportunity to dispute these allegations, and to determine what, if any, remedial sanctions against the Respondents are appropriate and in the public interest pursuant to Section 15(b) of the Exchange Act.
The Commission directed that an administrative law judge issue an initial decision in this matter within 210 days from the date of service of the Order Instituting Proceedings.
See also the Order in this matter