Securities and Exchange Commission v. Senderov et al, No. 4:2019cv05242 - Document 9 (E.D. Wash. 2020)
Court Description: ORDER GRANTING 8 FINAL MOTION TO APPROVE CONSENT JUDGMENT AND ENTRY OF CONSENT JUDGMENT AS TO DEFENDANT ANTON SENDEROV. Signed by Judge Rosanna Malouf Peterson. (TR, Case Administrator)
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Securities and Exchange Commission v. Senderov et al Case 4:19-cv-05242-RMP ECF No. 9 Doc. 9 filed 08/27/20 PageID.105 Page 1 of 12 1 2 FI LED I N THE U.S. DI STRI CT COURT EASTERN DI STRI CT OF WASHI NGTON 3 Aug 27, 2020 SEAN F. MCAVOY, CLERK 4 5 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF WASHINGTON 6 7 SECURITIES AND EXCHANGE COMMISSION, NO: 4:19-CV-5242-RMP 8 Plaintiff, 9 v. 10 11 ANTON SENDEROV; and LIOR BABAZARA, also known as Lior Bar, ORDER GRANTING FINAL MOTION TO APPROVE CONSENT JUDGMENT AND ENTRY OF CONSENT JUDGMENT AS TO DEFENDANT ANTON SENDEROV 12 Defendants. 13 14 BEFORE THE COURT is a Motion to Approve Consent Judgments from 15 Plaintiff Securities and Exchange Commission, ECF No. 8. The Court has reviewed 16 the Motion, proposed Final Judgments, and the attached Consents to those Final 17 Judgments signed by Defendants in this matter. Accordingly, the Court GRANTS 18 the Motion to Approve Consent Judgments, ECF No. 8, and ENTERS a Final 19 Consent Judgment according to the following terms: 20 21 The United States Securities and Exchange Commission having filed the Complaint and Defendant Anton Senderov (“Defendant” or “Senderov”) having ORDER GRANTING FINAL MOTION TO APPROVE CONSENT JUDGMENT AND ENTRY OF CONSENT JUDGMENT AS TO DEFENDANT ANTON SENDEROV ~ 1 Dockets.Justia.com Case 4:19-cv-05242-RMP ECF No. 9 filed 08/27/20 PageID.106 Page 2 of 12 1 waived service of a summons and the Complaint through counsel; consented to the 2 Court’s jurisdiction over Defendant and the subject matter of this action; consented 3 to entry of this Final Judgment without admitting or denying the allegations of the 4 Complaint (except as to jurisdiction and except as otherwise provided herein); 5 waived findings of fact and conclusions of law; and waived any right to appeal from 6 this Final Judgment: 7 8 9 I. IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that Defendant is permanently restrained and enjoined from: 10 (1) directly or indirectly, in the absence of any applicable exemption, offering 11 and/or selling “binary options,” financial instruments that expire at a predetermined 12 time where the payout is contingent on the future value of an underlying asset such 13 as a security or securities index, (hereinafter, “binary options”), or other securities, 14 in the United States unless a registration statement is in effect as to such binary 15 options; 16 (2) directly or indirectly offering and/or selling such binary options or other 17 securities in the United States as long as there is any amount due and owing by the 18 Defendant under the Judgment; or 19 20 (3) violating Section 5 of the Securities Act of 1933 (“Securities Act”) [15 U.S.C. §§ 77e] by, directly or indirectly, in the absence of any applicable exemption: 21 ORDER GRANTING FINAL MOTION TO APPROVE CONSENT JUDGMENT AND ENTRY OF CONSENT JUDGMENT AS TO DEFENDANT ANTON SENDEROV ~ 2 Case 4:19-cv-05242-RMP 1 ECF No. 9 filed 08/27/20 PageID.107 Page 3 of 12 (i) making use of any means or instruments of transportation or 2 communication in interstate commerce or of the mails in the United States to sell a 3 security through the use or medium of any prospectus or otherwise, unless a 4 registration statement is in effect as to such security; 5 (ii) carrying or causing to be carried through the mails or in interstate 6 commerce, by any means or instruments of transportation, any security for the 7 purpose of sale or for delivery after sale, unless a registration statement is in effect 8 as to such security; or 9 (iii) making use of any means or instruments of transportation or 10 communication in interstate commerce or of the mails to offer to sell or offer to buy 11 through the use or medium of any prospectus or otherwise any security, unless a 12 registration statement has been filed with the SEC as to such security, or while the 13 registration statement is the subject of a refusal order or stop order or (prior to the 14 effective date of the registration statement) any public proceeding or examination 15 under Section 8 of the Securities Act [15 U.S.C. § 77h], in violation of Section 5 of 16 the Securities Act [15 U.S.C. §§ 77e]. 17 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as 18 provided in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also 19 binds the following who receive actual notice of this Final Judgment by personal 20 service or otherwise: (a) Defendant’s officers, agents, servants, employees, and 21 ORDER GRANTING FINAL MOTION TO APPROVE CONSENT JUDGMENT AND ENTRY OF CONSENT JUDGMENT AS TO DEFENDANT ANTON SENDEROV ~ 3 Case 4:19-cv-05242-RMP ECF No. 9 filed 08/27/20 PageID.108 Page 4 of 12 1 attorneys; and (b) other persons in active concert or participation with Defendant or 2 with anyone described in (a). 3 II. 4 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that that 5 Defendant is permanently restrained and enjoined from , directly or indirectly, 6 unless Defendant is registered with the SEC in accordance with Section 15(b) of the 7 Securities Exchange Act of 1934 (the “Exchange Act”) [15 U.S.C. § 78o(b)], and in 8 the absence of any applicable exemption, acting as a broker-dealer in the United 9 States or otherwise making use of the mails or any means or instrumentality of 10 interstate commerce to effect any transactions in, or to induce or attempt to induce 11 the purchase or sale of, binary options or any other security (other than an exempted 12 security or commercial paper, bankers’ acceptances, or commercial bills) in the 13 United States, in violation of Section 15(a) of the Exchange Act [15 U.S.C. § 14 78o(a)]. 15 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as 16 provided in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also 17 binds the following who receive actual notice of this Final Judgment by personal 18 service or otherwise: (a) Defendant’s officers, agents, servants, employees, and 19 attorneys; and (b) other persons in active concert or participation with Defendant or 20 with anyone described in (a). 21 ORDER GRANTING FINAL MOTION TO APPROVE CONSENT JUDGMENT AND ENTRY OF CONSENT JUDGMENT AS TO DEFENDANT ANTON SENDEROV ~ 4 Case 4:19-cv-05242-RMP ECF No. 9 filed 08/27/20 PageID.109 Page 5 of 12 1 III. 2 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that that 3 Defendant is permanently restrained and enjoined from violating, directly or 4 indirectly, Section 10(b) of the Securities Exchange Act of 1934 (the “Exchange 5 Act”) [15 U.S.C. § 78j(b)] and Rule 10b-5 promulgated thereunder [17 C.F.R. 6 § 240.10b-5], by using any means or instrumentality of interstate commerce, or of 7 the mails, or of any facility of any national securities exchange, in connection with 8 the purchase or sale of any security: 9 (a) to employ any device, scheme, or artifice to defraud; 10 (b) to make any untrue statement of a material fact or to omit to state a 11 material fact necessary in order to make the statements made, in the light of 12 the circumstances under which they were made, not misleading; or 13 (c) 14 would operate as a fraud or deceit upon any person. 15 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as 16 provided in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also 17 binds the following who receive actual notice of this Final Judgment by personal 18 service or otherwise: (a) Defendant’s officers, agents, servants, employees, and 19 attorneys; and (b) other persons in active concert or participation with Defendant or 20 with anyone described in (a). to engage in any act, practice, or course of business which operates or 21 ORDER GRANTING FINAL MOTION TO APPROVE CONSENT JUDGMENT AND ENTRY OF CONSENT JUDGMENT AS TO DEFENDANT ANTON SENDEROV ~ 5 Case 4:19-cv-05242-RMP ECF No. 9 1 2 filed 08/27/20 PageID.110 Page 6 of 12 IV. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that 3 Defendant is jointly and severally liable with Defendant Lior Babazara a/k/a Lior 4 Bar for disgorgement and pre-judgment interest in the amount of $560,773.00, 5 representing profits gained as a result of the conduct alleged in the Complaint. 6 Defendant is further liable for a civil penalty in the amount of $350,000.00 pursuant 7 to Section 20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) of 8 the Exchange Act [15 U.S.C. § 78u(d)(3)]. Defendant shall satisfy this obligation by 9 paying the Securities and Exchange pursuant to the terms of the payment schedule 10 set forth below after entry of this Final Judgment. 11 Defendant may transmit payment electronically to the Commission, which 12 will provide detailed ACH transfer/Fedwire instructions upon request. Payment 13 may also be made directly from a bank account via Pay.gov through the SEC 14 website at http://www.sec.gov/about/offices/ofm.htm. Defendant may also pay by 15 certified check, bank cashier’s check, or United States postal money order payable to 16 the Securities and Exchange Commission, which shall be delivered or mailed to 17 18 Enterprise Services Center Accounts Receivable Branch 6500 South MacArthur Boulevard Oklahoma City, OK 73169 19 20 21 ORDER GRANTING FINAL MOTION TO APPROVE CONSENT JUDGMENT AND ENTRY OF CONSENT JUDGMENT AS TO DEFENDANT ANTON SENDEROV ~ 6 Case 4:19-cv-05242-RMP ECF No. 9 filed 08/27/20 PageID.111 Page 7 of 12 1 and shall be accompanied by a letter identifying the case title, civil action number, 2 and name of this Court; Anton Senderov as defendant in this action; and specifying 3 that payment is made pursuant to this Final Judgment. 4 Defendant shall simultaneously transmit photocopies of evidence of payment 5 and case identifying information to the Commission’s counsel in this action. By 6 making this payment, Defendant relinquishes all legal and equitable right, title, and 7 interest in such funds and no part of the funds shall be returned to Defendants. 8 The Commission may enforce the Court’s judgment for disgorgement and 9 prejudgment interest by moving for civil contempt (and/or through other collection 10 procedures authorized by law) at any time after 30 days following entry of this Final 11 Judgment. Defendant shall pay post judgment interest on any delinquent amounts 12 pursuant to 28 U.S.C. § 1961. The Commission shall hold the funds, together with 13 any interest and income earned thereon (collectively, the “Fund”), pending further 14 order of the Court. 15 The Commission may propose a plan to distribute the Fund subject to the 16 Court’s approval. Such a plan may provide that the Fund shall be distributed 17 pursuant to the Fair Fund provisions of Section 308(a) of the Sarbanes-Oxley Act of 18 2002. The Court shall retain jurisdiction over the administration of any distribution 19 of the Fund. If the Commission staff determines that the Fund will not be 20 distributed, the Commission shall send the funds paid pursuant to this Final 21 Judgment to the United States Treasury. ORDER GRANTING FINAL MOTION TO APPROVE CONSENT JUDGMENT AND ENTRY OF CONSENT JUDGMENT AS TO DEFENDANT ANTON SENDEROV ~ 7 Case 4:19-cv-05242-RMP 1 ECF No. 9 filed 08/27/20 PageID.112 Page 8 of 12 Regardless of whether any such Fair Fund distribution is made, amounts 2 ordered to be paid as civil penalties pursuant to this Judgment shall be treated as 3 penalties paid to the government for all purposes, including all tax purposes. To 4 preserve the deterrent effect of the civil penalty, Defendant shall not, after offset or 5 reduction of any award of compensatory damages in any Related Investor Action 6 based on Defendant’s payment of disgorgement in this action, argue that they are 7 entitled to, nor shall they further benefit by, offset or reduction of such 8 compensatory damages award by the amount of any part of Defendant’s payment of 9 a civil penalty in this action (“Penalty Offset”). If the court in any Related Investor 10 Action grants such a Penalty Offset, Defendant shall, within 30 days after entry of a 11 final order granting the Penalty Offset, notify the Commission’s counsel in this 12 action and pay the amount of the Penalty Offset to the United States Treasury or to a 13 Fair Fund, as the Commission directs. Such a payment shall not be deemed an 14 additional civil penalty and shall not be deemed to change the amount of the civil 15 penalty imposed in this Judgment. For purposes of this paragraph, a “Related 16 Investor Action” means a private damages action brought against Defendant by or 17 on behalf of one or more investors based on substantially the same facts as alleged in 18 the Complaint in this action. 19 20 21 V. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant shall pay the total of disgorgement, prejudgment interest, and civil ORDER GRANTING FINAL MOTION TO APPROVE CONSENT JUDGMENT AND ENTRY OF CONSENT JUDGMENT AS TO DEFENDANT ANTON SENDEROV ~ 8 Case 4:19-cv-05242-RMP ECF No. 9 filed 08/27/20 PageID.113 Page 9 of 12 1 penalty to the Commission according to the following schedule: (1) $200,000 as 2 partial payment of Defendant’s $350,000.00 civil penalty within 14 days of entry of 3 this Final Judgment; (2) 60 days following the entry of this Final Judgment, 4 $50,000.00 shall be due and applied toward the Defendant’s penalty balance; (3) 5 every additional 60 days following entry of this Final Judgment, Defendant shall pay 6 not less than $50,000.00, which shall be applied first to the Defendant’s outstanding 7 civil penalty until it is paid in full and thereafter shall be applied to the 8 disgorgement and prejudgment interest of $560,773.00 owed by Defendant jointly 9 and severally by with co-Defendant Lior Babazara a/k/a Lior Bar, until that amount 10 is paid in full. Payments shall be deemed made on the date they are received by the 11 Commission and shall be applied first to post-judgment interest, which accrues 12 pursuant to 28 U.S.C. § 1961 on any unpaid amounts due after 30 days from the 13 entry of this Final Judgment. Prior to making the final payment set forth herein, 14 Defendant shall contact the staff of the Commission for the amount due for the final 15 payment. 16 If Defendant fails to make any payment by the date agreed and/or in the 17 amount agreed according to the schedule set forth above, all outstanding payments 18 under this Final Judgment, including post-judgment interest, minus any payments 19 made, shall become due and payable immediately at the discretion of the staff of the 20 Commission without further application to the Court. 21 ORDER GRANTING FINAL MOTION TO APPROVE CONSENT JUDGMENT AND ENTRY OF CONSENT JUDGMENT AS TO DEFENDANT ANTON SENDEROV ~ 9 Case 4:19-cv-05242-RMP 1 2 ECF No. 9 filed 08/27/20 PageID.114 Page 10 of 12 VI. IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that 3 within 14 days after entry of this Final Judgment, Defendant’s counsel, Saul Ewing 4 Arnstein & Lehr (“Saul Ewing”), shall transfer not less than $200,000 received from 5 Defendant for payment of this Final Judgment, or held for the benefit of Defendant 6 for payment of this Final Judgment, representing proceeds from certain allegations 7 in the Complaint, to the Commission. Saul Ewing may transmit payment 8 electronically to the Commission, which will provide detailed ACH transfer/Fedwire 9 instructions upon request. Payment may also be made directly from a bank account 10 via Pay.gov through the SEC website at http://www.sec.gov/about/offices/ofm.htm. 11 Saul Ewing also may transfer these funds by certified check, bank cashier’s check, 12 or United States postal money order payable to the Securities and Exchange 13 Commission, which shall be delivered or mailed to 14 15 Enterprise Services Center Accounts Receivable Branch 6500 South MacArthur Boulevard Oklahoma City, OK 73169 16 17 18 19 and shall be accompanied by a letter identifying the case title, civil action number, and name of this Court; Anton Senderov as defendant in this action; and specifying that payment is made pursuant to this Final Judgment. 20 21 ORDER GRANTING FINAL MOTION TO APPROVE CONSENT JUDGMENT AND ENTRY OF CONSENT JUDGMENT AS TO DEFENDANT ANTON SENDEROV ~ 10 Case 4:19-cv-05242-RMP ECF No. 9 1 filed 08/27/20 PageID.115 Page 11 of 12 VII. 2 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, solely for 3 purposes of exceptions to discharge set forth in Section 523 of the Bankruptcy Code, 4 11 U.S.C. § 523, the allegations in the Complaint are true and admitted by Defendant, 5 and further, any debt for disgorgement, prejudgment interest, civil penalty or other 6 amounts due by Defendant under this Final Judgment or any other judgment, order, 7 consent order, decree or settlement agreement entered in connection with this 8 proceeding, is a debt for the violation by Defendant of the federal securities laws or 9 any regulation or order issued under such laws, as set forth in Section 523(a)(19) of 10 the Bankruptcy Code, 11 U.S.C. § 523(a)(19). 11 VIII. 12 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that the 13 Consent of Defendant is incorporated herein with the same force and effect as if fully 14 set forth herein, and that Defendant shall comply with all of the undertakings and 15 agreements set forth therein. IX. 16 17 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that this 18 Court shall retain jurisdiction of this matter for the purposes of enforcing the terms 19 of this Final Judgment. 20 / / / 21 / / / ORDER GRANTING FINAL MOTION TO APPROVE CONSENT JUDGMENT AND ENTRY OF CONSENT JUDGMENT AS TO DEFENDANT ANTON SENDEROV ~ 11 Case 4:19-cv-05242-RMP 1 2 3 4 5 ECF No. 9 filed 08/27/20 PageID.116 Page 12 of 12 IT IS SO ORDERED. The District Court Clerk is directed to enter this Order and Consent Judgment and provide copies to counsel. DATED August 27, 2020. s/ Rosanna Malouf Peterson ROSANNA MALOUF PETERSON United States District Judge 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 ORDER GRANTING FINAL MOTION TO APPROVE CONSENT JUDGMENT AND ENTRY OF CONSENT JUDGMENT AS TO DEFENDANT ANTON SENDEROV ~ 12
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