The Securities and Exchange Commission today announced settled charges against 23 entities and individuals for failures to timely report information about their holdings and transactions in public company stock. Two public companies were also charged for contributing to filing failures by their officers and directors and failing to report their insiders’ filing delinquencies as required.
The charges announced today stem from SEC enforcement initiatives focused on Schedules 13D and 13G reports and Forms 3, 4, and 5 that certain corporate insiders are required to file. Schedules 13D and 13G provide information about the holdings and intentions of investors who beneficially own more than five percent of any registered voting class of public company stock. Forms 3, 4, and 5 are reports used to provide information about public company stock transactions by corporate officers, directors, or certain investors who beneficially own more than 10 percent of the stock. These reporting requirements apply irrespective of whether the trades were profitable and regardless of a person’s reasons for the transactions. SEC staff used data analytics to identify the charged individuals and entities as filing required reports late.
Without admitting or denying the findings, all of the entities and individuals agreed to cease and desist from committing and causing violations of the respective charged provisions and to pay civil penalties.
The firms charged in connection with beneficial ownership of publicly traded companies and their respective penalties are:
- Sunbeam Management, LLC - $40,000;
- TALANTA Investment Group, LLC - $45,000;
- Grays Peak Ventures LLC - $65,000;
- Stilwell Value LLC - $75,000;
- BSC, LP - $75,000;
- Bain Capital Credit Member, LLC - $130,000;
- FIG LLC, which conducts business under the name Fortress Investment Group - $200,000;
- Adage Capital Management, L.P. - $200,000;
- Essex Woodlands Management, Inc. - $225,000;
- The Goldman Sachs Group, Inc. - $300,000;
- Oaktree Capital Management, L.P. - $375,000;
- The Bank of Nova Scotia - $375,000; and
- Alphabet Inc. - $750,000.
Alphabet was also charged with failing to timely file Forms 13F, reports institutional money managers are required to file regarding certain sizeable securities holdings.
The Individuals charged who were officers, directors, and/or beneficial owners of publicly traded companies, and the civil penalty each will pay, are:
- Mitchell P. Rales, of Potomac, Maryland - $10,000;
- Scott B. Stevens, of Bedford, New York - $20,000;
- Michael Winterhalter, of Dana Point, California - $20,000;
- Pedro C. Gonzalez, of St. Petersburg, Florida - $25,000;
- Curtis Drew Hodgson, of Addison, Texas - $30,000;
- Kenneth E. Shipley, of Levelland, Texas - $30,000;
- Peter M. Thomas, of Las Vegas, Nevada - $77,000;
- Howard S. Jonas, of Easton, Pennsylvania - $90,000;
- David L. Kanen, of Parkland, Florida - $109,000; and
- Jack W. Schuler, of Lake Bluff, Illinois - $200,000.
The public companies charged that contributed to filing failures and failed to report delinquencies, and the civil penalty each will pay, are:
- Legacy Housing Corporation - $200,000; and
- Celsius Holdings, Inc. - $200,000.
“To make informed investment decisions, shareholders rely on, among other things, timely reports about insider holdings and transactions and changes in potential controlling interests,” said Thomas P. Smith, Jr., Associate Regional Director of the SEC’s Division of Enforcement. “Today’s actions are a reminder to large investors that they must commit necessary resources to ensure these reports are filed on time.”
The SEC previously charged corporate insiders for failing to timely report transactions and holdings, and several issuers for contributing to their insiders’ failures in September 2023.
The SEC’s investigations were conducted by Eric C. Kirsch and Bari R. Nadworny, of the New York Regional Office, Christine Chen and Gary Zinkgraf of SEC Headquarters, Cassandra Arriaza and Dahlia Rin of the Boston Regional Office, Jennifer Miller of the Philadelphia Regional Office, and Douglas Dykhuizen of the Atlanta Regional Office. Beth Groves, Howard Kaplan, and Alexander C. Lefferts of the Division of Enforcement’s Office of Investigative & Market Analytics and Michael Pessin of the Division of Economic and Risk Analysis also provided assistance. The teams worked in close collaboration with Anne M. Krauskopf and Nicholas P. Panos in the agency’s Division of Corporation Finance. The investigations were supervised by Wendy Tepperman and Mr. Smith of the New York Regional Office and Jeffrey Weiss, Armita Cohen, and Mark Cave of SEC Headquarters.
