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U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 23381 / October 8, 2015

Securities and Exchange Commission v. Garfield Taylor, Inc., et al,, Civil Action No. 1:11-CV-02054-RC (District Court for the District of Columbia)

SEC Obtains Final Judgments Against Garfield M. Taylor, Jeffrey A. King, Garfield Taylor, Inc., Gibraltar Asset Management Group, LLC and the King Group, LLC

On October 8, 2015, the Securities and Exchange Commission announced that the Honorable Rudolph Contreras, United States District Judge for the District of Columbia, entered final judgments on September 28, 2015, against Garfield M. Taylor, Jeffrey A. King, Garfield Taylor, Inc. (“GTI”), Gibraltar Asset Management Group, LLC (“Gibraltar”) and The King Group, LLC (“TKG”), in connection with a multi-million dollar Washington-area Ponzi scheme.

The Commission filed a complaint on November 18, 2011, alleging that Gibraltar’s and GTI’s former Chief Executive Officer, Garfield M. Taylor, operating through GTI and Gibraltar, with the assistance of Jeffrey A. King and others, conducted a Ponzi scheme targeting investors in the Washington D.C. metropolitan area.  The complaint alleged that the scheme defrauded more than $27 million from approximately 130 investors from 2005 to 2010, before ultimately collapsing in the fall of 2010.

On September 17, 2012, the Court granted the Commission’s motion for default judgment as to GTI, Gibraltar, King and TKG, and on December 13, 2012, the Court granted the Commission’s motion for summary judgment on all charges sought by the Commission against Taylor.  Prior to determining the appropriate relief against Taylor and the defaulting defendants, on March 28, 2013, the Court granted Taylor’s motion to hold the case in abeyance, in light of the then pending federal criminal charges against him.

Taylor pleaded guilty in March 2014 in the U.S. District Court of the District of Columbia to securities fraud.  In May 2015, he was sentenced to 13 years in prison and ordered to pay over $28.6 million in restitution.  In July 2015, the Court in the civil matter lifted the stay and ruled on the Commission’s pending motions seeking remedies against Taylor, King, Gibraltar, GTI and TKG.  On September 28, 2015, the Court ordered the following relief against the defendants:

  • Garfield M. Taylor was permanently enjoined from violating Sections 10(b) and 15(a)(1) of the Securities Exchange Act of 1934 (“Exchange Act”), Rule 10b-5 promulgated under the Exchange Act, and Sections 5 and 17(a) of the Securities Act of 1933 (“Securities Act”).  He was also ordered to pay disgorgement of approximately $23.6 million and prejudgment interest of approximately $4.3 million, for a total of approximately $27.9 million.
  • Jeffrey A. King was permanently enjoined from violating Sections 10(b) and 15(a)(1) of the Securities Exchange Act, Rule 10b-5 promulgated under the Exchange Act, and Section 17(a) of the Securities Act.  He was ordered to pay disgorgement of $137,641, prejudgment interest of $14,480 and a civil penalty of $150,000, for a total of $302,121.
  • Gibraltar Asset Management Group, LLC was permanently enjoined from violating Sections 10(b) of the Exchange Act, Rule 10b-5 promulgated under the Exchange Act, and Sections 5 and 17(a) of the Securities Act.  Gibraltar was also ordered to pay disgorgement of approximately $9.4 million, prejudgment interest of $826,460 and a civil penalty of $725,000, for a total of approximately $10.9 million.
  • Garfield Taylor, Inc. was permanently enjoined from violating Sections 10(b) of the Exchange Act, Rule 10b-5 promulgated under the Exchange Act, and Sections 5 and 17(a) of the Securities Act.  Gibraltar was also ordered to pay disgorgement of approximately $14.2 million, prejudgment interest of approximately $2.9 million and a civil penalty of $725,000, for a total of approximately $17.9 million.
  • The King Group, LLC, a relief defendant wholly owned and controlled by King, was ordered to pay disgorgement of $65,801 and prejudgment interest of $14,409, for a total of $80,210.

For further information, please see Litigation Release No. 22162 (November 18, 2011), Litigation Release No. 22611 (February 5, 2013) and Litigation Release No. 22665 (April 3, 2013).

 

http://www.sec.gov/litigation/litreleases/2015/lr23381.htm


Modified: 10/08/2015