U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 23143 / November 25, 2014
Securities and Exchange Commission v. Hold Brothers On-Line Investment Services, LLC, now known as Tafferer Trading, LLC, Gregory Hold, and Steven Hold, Civil Action No. 2:14-cv-7286-KSH-CLW (D.N.J.)
SEC Brings Proceeding to Enforce Compliance with Consent Order to Pay Over $2 Million and Seeks Joint and Several Liability Against Control Persons
The Securities and Exchange Commission announced today that on November 21, 2014, it filed an application in the United States District Court for the District of New Jersey seeking compliance by Hold Brothers On-Line Investment Services, LLC, now known as Tafferer Trading, LLC (Hold Brothers), with an SEC consent order requiring it to pay a balance of over $2 million in disgorgement, civil penalties, and post-order interest. The SEC further seeks to have Gregory and Steven Hold, the eponymous Hold brothers, held jointly and severally liable as control persons for culpably causing Hold Brothers to fail to pay the agreed-upon amount to the SEC.
On September 25, 2012, the SEC issued a consent order in an administrative proceeding finding that Hold Brothers had violated the federal securities laws by enabling and failing to adequately monitor deceptive trading practices by certain offshore traders who used its systems. It required Hold Brothers to pay disgorgement, civil penalties, and post-order interest totaling $2,535,237.44 in five installments over the next 360 days. Hold Brothers made only the first scheduled payment of $503,333.40 before defaulting.
The SEC alleges that Gregory Hold and Steven Hold controlled Hold Brothers, which paid at least $1.4 million to certain members (equity holders) in the same month that the Commission issued its consent order. According to the SEC’s application, Gregory and Steven Hold culpably caused Hold Brothers to fail to comply with the Commission’s consent order and are jointly and severally liable with Hold Brothers for the unpaid amount of disgorgement, civil penalty, and post-order interest.
For further information see Securities Exchange Act Release No. 67924 / Investment Company Act Release No. 30213 (Sept. 25, 2012).