SEC v. Honig, et al.
DOCKET · 1:18-cv-08175 · FILED · SEP 7, 2018
Violations Charged
Sections 17(a)(1), (3), Section 10(b), Rule 10b-5, Sections 13(d), 16, Section 5
Case Overview
The SEC charged a group of investors led by Barry Honig, with co-defendants including Phillip Frost and Michael Brauser, in connection with pump-and-dump schemes in three public companies between 2013 and 2018. In each, the group acquired large stakes at steep discounts through shells, reverse mergers, or financings on terms unfavorable to the company, then operated as an undisclosed control group while staying under the ownership disclosure thresholds.
The group paid a promoter to publish favorable and materially misleading articles, and in several instances traded ahead of the promotions to create the appearance of market interest. Company executives signed filings that omitted the group's ownership. According to the complaint, the three schemes generated more than $27 million in stock sales.
Joe's Role
The SEC's press release announcing the charges names Joe among the staff who conducted the investigation.
Outcome
Most defendants, including Honig and Frost, consented to final judgments between 2019 and 2021, with the remaining claims resolving in the years after.
ISSUERS · 3 issuers ยท $27M+ in unlawful sales