Endurance Exploration Group Inc (EXPL)

[hedge_fun]

U.S. Securities and Exchange Commission v. Spartan Securities Group, LTD., et al.

CASE SUMMARY

The SEC alleges that market-makers Spartan, and transfer agent Island, were involved in filing Form 211 applications with the Financial Industry Regulatory Authority (FINRA) to publicly list 19 issuers’ common stock to be traded and available to investors. The SEC eventually discovered that the issuers had been involved in fraud, and now faults Spartan and Island for failing to discover the misconduct. The Commission also claims the companies failed to investigate certain SEC “red flags” raised by FINRA. However, SEC has repeatedly emphasized the limited nature of the obligation of market-makers and rejected any view that they have a special due diligence requirement to look beyond the statements made to them by issuers of securities.

Neither Spartan nor Island nor any of their employees were involved in the creation or operation of the named issuers listed in the complaint, and they have amply complied with their statutory obligations, gathered all required information, and compiled reams of documents supporting the applications above and beyond the lawful requirements. NCLA argues that SEC is attempting to hold the defendants liable under an arbitrary expansion of the requirements of applicable rules set out by Congress and the Commission itself. SEC’s Division of Enforcement would hold the market-makers responsible, even when both regulators from FINRA and the SEC’s own examiners have analyzed the same information and declared it to be valid and genuine.

https://nclalegal.org/u-s-securities-and-exchange-commission-v-spartan-securities-group-ltd-et-al/?fbclid=IwAR3e-hQCOxYzFdj9tPyjzY4zFI67qF6LFa8e1xydwwiFdVy2WRfJol5VEug

Just to add, Island’s records were reviewed by regulators in 2012 and no concerns were raised. In the complaint allegations that pre-date 2012 are cited using the exact same records.

Mark Harmon, the Defendants expert witness who has over 30 years experience advising Transfer Agents and is GC to their association has filed a report stating Island did nothing wrong. But the SEC is trying to suggest his report should not be admissible. I guess they’re afraid to cross examine him because they know they have no case.