U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 23212 / March 3, 2015
Securities and Exchange Commission v. Inofin, Inc., Michael J. Cuomo, Kevin J. Mann, Sr., Melissa George, Thomas Kevin Keough, David Affeldt, and Nancy Keough, Civil Action No. 1:11-CV-10633 (D. Mass., Complaint Filed April 14, 2011
Final Judgements Entered Against Former Sales Agent of Massachusetts Company and His Wife
The Securities and Exchange Commission announced today that the U.S. District Court for the District of Massachusetts has entered final judgments against Thomas Kevin Keough ("Kevin Keough"), a former registered representative associated with a broker-dealer, and his wife, Nancy Keough, in connection with their role in the unlawful promotion and sale of unregistered securities issued by Inofin, Inc., a subprime auto-financing company. Among other things, the judgments order the Keoughs to pay a total of over $350,000 in disgorgement of ill-gotten gains.
The Keoughs were defendants in a lawsuit brought by the Commission against Inofin, its former executives, and its sales agents alleging they illegally raised at least $110 million from hundreds of individual investors through the sale of unregistered Inofin notes and that Inofin and its executives lied about the company's financial performance and how Inofin was using its investors' money. The Commission alleged that Kevin Keough unlawfully earned commissions by promoting and selling Inofin's unregistered securities and that he concealed his activities from his broker-dealer employers by directing Inofin pay his illegal commissions to his wife, Nancy, who was named as a relief defendant in the Commission's action for the purpose of recovering these funds from her.
The judgment against Kevin Keough was entered on February 20, 2015. Kevin Keough consented to the entry of this judgment. The court entered summary judgment against Nancy Keough on September 25, 2014. The judgments order the Keoughs to disgorge $368,430 in illegal commissions. The judgment against Kevin Keough also orders him to pay an additional $44,500 in interest and permanently enjoins him from violating Section 15(a) of the Securities Exchange Act of 1934 ("Exchange Act") and Sections 5(a) and 5(c) of the Securities Act of 1933 ("Securities Act"). The court is still considering whether to order Kevin Keough to pay a civil penalty.
In a related action, the Commission issued an Order on March 3, 2015, barring Kevin Keough from certain parts of the securities industry, with the right to apply for reentry to the industry after three years. Kevin Keough consented to the issuance of this Order.
The Commission previously obtained final judgments by consent against Inofin's former executives Michael J. Cuomo of Plymouth, Massachusetts, Kevin Mann, Sr. of Marshfield, Massachusetts and Melissa George of Duxbury, Massachusetts and against another Inofin sales agent, David Affeldt of Potomac, Maryland. The judgments ordered Cuomo, George, Mann, and Affeldt to pay disgorgement and civil penalties and permanently enjoined them from violating the Exchange Act and the Securities Act. The SEC's action remains pending against bankrupt Inofin.
For further information, see Litigation Release No. 21929 (April 14, 2011), Litigation Release No. 22435 (August 6, 2012), Litigation Release No. 22667 (April 5, 2013), and Litigation Release No. 23006 (May 28, 2014).