U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 23865 / June 21, 2017
Accounting and Auditing Enforcement Release No. 3881 / June 21, 2017
Securities and Exchange Commission v. Jay Mac Rust and Christopher K. Brenner, No. 16-cv-03573 (S.D.N.Y. filed May 13, 2016)
SEC Obtains Judgment Against Attorney Who Defrauded Escrow Clients
The Securities and Exchange Commission obtained a partial judgment against Christopher K. Brenner, an attorney licensed to practice in Colorado and Texas.
The partial judgment, entered on June 9, 2017 by the Honorable Edgardo Ramos of the U.S. District Court for the Southern District of New York, permanently enjoins Brenner from violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, orders that disgorgement, pre-judgment interest and a civil money penalty be imposed, and defers the determination of the amounts of such relief until a later date. Brenner also has consented to the entry of an SEC order, based on the court’s entry of judgment, permanently suspending him from appearing and practicing before the SEC as an attorney. The order prohibits Brenner from representing clients in SEC matters, including investigations, litigation, or examinations, and from advising clients about SEC filing obligations or content. Brenner consented to the judgment and order and neither admitted nor denied the allegations in the complaint or the findings in the order.
The SEC charged Brenner and his co-defendant, Jay Mac Rust, with fraud for making undisclosed risky investments and in some instances outright stealing money they obtained in escrow accounts from small business owners seeking commercial loans. The SEC’s litigation against Rust continues.
The examination that uncovered the misconduct was conducted by broker-dealer examiners in the New York office. The ensuing investigation was conducted by Daphna A. Waxman, Tuongvy T. Le, and Valerie A. Szczepanik. The litigation is being led by Richard G. Primoff, and the case is being supervised by Lara S. Mehraban.