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Stark Biography |
Recent Significant Prosecutions Led by the Office of Internet Enforcement
Biographical Information
John Reed Stark serves as Chief of the Office of Internet Enforcement (OIE) in the Division of Enforcement of the U.S. Securities and Exchange Commission. Mr. Stark’s job entails the direction, coordination and implementation of the Enforcement Division’s Internet Program. Mr. Stark is also an Adjunct Professor of Law at the Georgetown University Law Center where, for the past twelve years, he has taught a course on advanced securities regulation. Mr. Stark has also published a wide range of articles on SEC issues and serves as Co-Chair of the American Bar Association Litigation Section Subcommittee on Securities Law and the Internet.
Mr. Stark received his original appointment to direct the Internet Program in late 1995, and is the first and only person to hold the position. In July of 1998, Mr. Stark was promoted to the new position of Chief of OIE. OIE, now a team of about twenty-five professionals (almost exclusively attorneys), conducts investigations and prosecutions of securities violations, specializing in those that involve technology (including coordinating five nationwide sweeps).
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--Chief-- Office of Internet Enforcement United States Securities and Exchange Commission
--Adjunct Professor-- Securities Regulation Graduate Program Georgetown University Law Center |
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Mr. Stark also coordinated and ran several securities fraud training programs, including several CyberSecurities Forums attended by hundreds of members of the law enforcement and regulatory community.
Mr. Stark began with the Enforcement staff in September 1991 with a brief eight month interruption to serve a detail as a Special Assistant United States Attorney for the United States Attorney’s Office for the District of Columbia. As an AUSA, Mr. Stark prosecuted street crimes mostly pertaining to guns, drugs and domestic violence. Prior to joining the SEC, Mr. Stark worked as an associate for the law firm of Arent Fox Kintner Plotkin and Kahn where he focused on business-related litigation.
Mr. Stark received his law degree from Duke University School of Law in 1989, where he reached the finals of the Hardt Cup and the finals of a national moot court competition. He also served on Duke's Moot Court Executive Board during his second year and as its Vice-Chair during his third year.
Mr. Stark received his undergraduate degree (cum laude) in Political Science from Union College in 1986, where he graduated with departmental honors, was awarded an honors designation for his senior thesis, was appointed to the Pi Sigma Alpha political science honors society and was a Stanley R. Becker Scholar.
Significant SEC Enforcement Matters Led By the Office of Internet Enforcement
In the Matter of Trading in the Securities of GenX Corporation (trading suspension of purported digital music company) |
In the Matter of Trading in the Securities of Patriot Energy Corporation (trading suspension of purported alternative energy company) |
| SEC v. James Nicholson and Westgate Capital Management LLC and Relief Defendants (Hedge fund fraud) |
| SEC v. Butko (fraudulent scheme to manipulate the prices of numerous stocks through the unauthorized use of other people’s online brokerage accounts) |
| In the Matter of E*Trade Clearing LLC and E*Trade Securities LLC (anti-money laundering action concerning E*Trade's failure to vet 65,442 of its joint account holders for possible terrorism links, failure of broker-dealer to comply with the reporting, recordkeeping and record keeping requirements in regulations implemented under the Bank Secrecy Act) |
SEC v. George J. Simchuk (former mining manager of Glamis de Mexico settles to insider trading violation for purchasing shares of Western Silver company while he worked on the Glamis due diligence team for Glamis's potential acquisition of Western Silver) |
SEC v. Michael A. Stummer (Daytrader commits unlawful deception when he sneaks into brother-in-law's computer in brother-in-law's bedroom, reviews material, nonpublic information about possible tender offer by brother-in-law's private equity firm's client and trades on the basis of that information) |
In the Matter of Certain Companies Trade in the Pink Sheets: NeoTactix Corporation, Graystone Park Enterprises, Inc. and Younger America, Inc. (SEC Suspends Trading in Three Companies Promoted Through Spam and Internet Videos (including on YouTube) |
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In the Matter of Kenneth M. Christison, Esq. (SEC order finding attorney caused an unlawful distribution of securities in multimillion dollar pump-and-dump scheme) |
Complaint (unofficial copy) |
SEC v. Michael Saquella a.k.a. Michael Paloma and Lawrence Kaplan (intricate microcap pump and dump scheme (filed parallel with the U.S. Attorney's Office for the Eastern District of Virginia)) |
Complaint (unofficial copy) |
SEC v. Shane Bashir Suman and Monie Rahman (unlawful insider trading by Information technology specialist at MDS, Inc. (and his wife) prior to a tender offer by Molecular Devices Corporation (filed parallel with the Ontario Securities Commission) |
| LR-56116 | Vision Airships Trading Suspension See also Order (Trading Suspension FAQ) |
| SEC v. CyberKey Solutions Inc. and James Plant (false press releases issued concerning purported contract with the Department of Homeland Security) (parallel criminal arrest by Philadelphia U.S. Attorney's Office) |
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SEC v. Jaisankar Marimuthu, Chockalingam Ramanathan and Thirugnanam Ramanathan (fraudulent scheme to manipulate the prices of numerous stocks through the unauthorized use of other people’s online brokerage accounts; filed parallel with Omaha U.S. Attorney's Office ) |
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SEC v. Shashakant C. Shah (unlawful insider trading by Able Laboratories, Inc.'s Vice President concerning his concealment from the FDA of Able's faulty quality control testing practices; filed parallel with the New Jersey U.S. Attorney's office) |
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Supporting TRO |
SEC v. One or More Unknown Traders in the Common Stock of Certain Issuers and JSC Parex Bank (relief defendant) (Emergency asset freeze of $3 million of unlawful profits of fraudulent scheme to manipulate the prices of numerous stocks through the unauthorized use of other people’s online brokerage accounts) |
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SEC v. Daniel Fongnien Chiang and Eva Yi-Fen Chen (unlawful insider trading by husband and wife in the securities of SINA) |
| 34-55237 | CyberKey Solutions Inc. Trading Suspension See also Order (Trading Suspension FAQ) |
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SEC v. Kamardin (fraudulent scheme to manipulate the prices of numerous stocks through the unauthorized use of other people’s online brokerage accounts) |
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In the Matter of Able Laboratories, Inc. (De-registration) |
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In the Matter of Timothy F. Bell and In the Matter of Tracy A. Edwards (private placement stock fraud, see SEC LR-19098; U.S. Attorney's Office for the Central District of California also prosecuted related defendant) |
| SEC v. Salvatore Favata (fraudulent Ponzi scheme of so-called "investment notes" purportedly based upon mortgages and deeds of trust for real estate investments; joint filing with Central District of California U.S. Attorney's office) |
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GLUV Trading Suspension Order |
SEC v. Peter D. Kirschner and Media Magic, Inc. and In the Matter of Peter D. Kirschner (Fraudulent procurement of stock dividend shares in advance of the date on which they were to be publicly distributed and selling those shares into an uninformed market at prices that did not yet reflect the increase in the total number of outstanding shares) |
| SEC v. Boling, Boling, Mills and Direct Results of Sweetwater (Phase II of so called "vicemail" stock manipulation scheme, including charges against the voice behind the calls; filed parallel with with District of Columbia U.S. Attorney's office) (Press Release Announcing criminal pleas) |
| SEC v. Alexander J. Yaroshinsky and Victor E. Zak (emergency asset freeze of California drug executive with unlawful insider trading after learning of the FDA's reaction to Cancer tests of company's Acne drug) |
| LR-20674 | SEC v. Shawn Casius, Logic's Consulting, Inc., Steven R. Wright, International Solutions, Inc., Peter Jessop, Socius Holdings, Ltd., and SIGF SA (emergency asset freeze concerning concerted market manipulation of the stock of Cameron International) |
| 34-52743 | Cameron International, Inc. Trading Suspension See also Order (Trading Suspension FAQ) |
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In the Matter of Instinet LLC and INET ATS, Inc. (Failure to file accurate Order Execution Quality Reports -- first matter of this kind ever charged by SEC; joint filing with NASD) |
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In the Matter of Ford Motor Credit Company (Unlawful marketing of $7.3 billion of debt securities in so-called "corporate money market accounts" -- first matter of this kind ever charged by SEC) |
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SEC v. Blue Square, Westwood Holdings, Viktor Novosselov (AKA David Markovitz), Igor Malyar (AKA George Falcone) (fraudulent offering of ATM companies; filed parallel with Connecticut U.S. Attorneys Office) |
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SEC v. StockerYale, Inc. and and Mark W. Blodgett (failure to verify information in two false and misleading press releases) |
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In the Matter of DB Investment Advisers In the Matter of Galleon Management L.P. In the Matter of Oaktree Capital Management (hedge funds' multiple violations of SEC Regulation M and Rule 105) |
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SEC v. Michael O'Grady, Peter Cahill, David E. Wittimore, et al (so called "vicemail" stock manipulation scheme; criminal action filed parallel by the District of Columbia U.S. Attorney's office -- first matter of this kind ever charged by SEC) |
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SEC v. Z-Par Holdings, Inc., Z-Par Investment Fund II, Larry Michael Parrish, Michael Edward Zimmerman, defendants, and Eduard Akopian A/K/A Edward Akopian, and Capital Ban Corp., A California Corporation, relief defendants. (emergency asset freeze of up to $17 million of assets raised in prime bank scheme) |
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SEC v. Anthony C. Sudol III, Michael G. Sudol and Richard J. Sudol (unlawful insider trading in the securities of certain CISCO acquisition targets) |
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SEC v. Hubert A. Jeffreys, a/k/a Hugh Jeffreys, Earthboard Sports USA, Inc., Timothy F. Bell and Tracy A. Edwards (private placement stock fraud, filed parallel with the U.S. Attorney's Office for the Central District of California) |
| 34-51105 | Commanche Properties, Inc. Trading Suspension See also Order (Trading Suspension FAQ) |
| 34-51087 | Courtside Products, Inc. Trading Suspension See also Order (Trading Suspension FAQ) |
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SEC v. Discover Capital Holdings Corp., Eli Dinov, Ari Dinov, and David Rubinov (emergency asset freeze concerning boiler-room market manipulation) |
| SEC v. Van Dinh
(hacking, identity theft and securities fraud; filed parallel with Massachusetts U.S. Attorneys Office -- first matter of this kind ever charged by SEC) |
| SEC v. Andrew Gold
(pattern of reporting violations) |
| SEC v. K.C. Smith
and Kryer
Financial, (hacking, identity theft and securities fraud; filed parallel with Virginia U.S. Attorneys Office and Tennessee U.S. Attorney's office) |
| LR-18685 | SEC v. Clif Goldstein, formerly known as Clifford Dixon
Noe, Paul Howe Noe, also known as Paul Noe Randall, Carolyn M. Kaplan, Noel
Alelov, Russell B. Gerstein, Nuell W. Paschal, Great American Trust Company,
Inc., and Great American Trust Corporation, Inc.
(so called "prime bank fraud;" filed parallel with South Carolina U.S. Attorneys Office) |
| SEC v. Kin H. Lee
(market manipulation in the after hours marketplace -- first matter of this kind ever charged by SEC) |
| LR-18614 | SEC v. Nikolai Safavi
(impersonation/market manipulation) |
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SEC v.
Arash Aziz-Golshani, Hootan Melamed and Allen Derzakharian
(emergency asset freeze concerning market manipulation of stock of NEI Webworld; filed parallel with Central District of California U.S. Attorneys Office) |
| 34-49657 |
SEC v. William Lyons and SV Group (so-called "prime bank fraud") |
Recipient, 2007 Stanley Sporkin Award (granted to SEC staff member for tenacious and insightful contribution to SEC Enforcement)
Recipient, 2004 Duke University School of Law's Young Alumni Award (granted to one Duke law graduate each year for his or her significant contributions of leadership and service both professionally and to Duke Law School)
One of 2002’s “Online Finance Forty” as compiled by Institutional Investor (sole government designee)
Recipient, 2001 SEC Supervisory Excellence Award
One of “Ten to Watch in 1999: The People and the Companies Bringing Business to the Net” as compiled by The Industry Standard (sole government designee)
#11 of “20 Most Important Players on Financial Web in 1997” as compiled by Institutional Investor (sole government designee)
"Top Regulator of 1997" and Runner-up "Internet Compliance Person of the Year" in Internet Compliance Alert
Publications
(Adobe Reader sometimes required) 
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Keeping Watch: Five Great Management Lessons from Seven Great Watches June 2008 HR: Watches Magazine (Volume 11, Issue 3) |
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The Presidents and Their Timepieces December 2007 HR: Watches Magazine (Volume 10, Issue 6) |
| How To Buy a Watch on EBay October 2007 HR: Watches Magazine (Volume 10, Issue 5) |
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Using the SEC's Statutory Weaponry to Combat Spam (Spring 2006 University of Toledo Law Review, in commemoration of the ten year anniversary of the CyberSecurities Institute) (with Carolyn E. Kurr) |
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Real World Juries: From Deliberation Room to Green Room, ABA Securities Litigation Journal (Volume 15, Number 3, Summer 2005 ) (with David R. Fontaine) |
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Online Road Shows: Past, Present and Future, Journal of Internet Law, (Volume 8, Number 11, May 2005) (with William W. Hankins) |
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Prime Bank Frauds: Past, Present and Future: The Fatal Internet Migration of Dr. No (Securities Regulation Law Journal in Spring 2003) (with N. Blair Vietmeyer) |
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Successful Management For The New Millennium: 12 Great Lessons From 12 Great Cop Flicks (Presented at 2002 Economic Crime Summit of National White Collar Crime Center Spring 2002) (with Captain Matthew Klein) |
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Enforcenet Redux: A Retrospective of the SEC’s Internet Program Four Years After its Genesis (The Business Lawyer, November 2001) |
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Internet Fraud: Myths and Reality (NSCP Currents, December 2000) |
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The SEC’s Statutory Weaponry to Combat Internet Fraud (The Securities Reporter, Fall 1999) (with Stephen Cutler) |
| Securities Enforcement Tombstones: The Internet’s Impact Upon SEC Rules of Engagement (Insights Magazine, February 1998) |
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SEC Enforcement and The Internet: Meeting the Challenge of the Next Millennium . . . A Program for the Eagle and The Internet (The Business Lawyer, May 1997 (with Joseph Cella) |
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Never, Ever Leave Your Wingman (September 1997, not yet published) |