SEC Charges California-Based Attorney with Securities Registration Violations
Litigation Release No. 24024 / January 5, 2018
Securities and Exchange Commission v. Owen H. Naccarato, Civil Action No. 1:17-cv-24682-JLK (S.D. Fla. filed December 26, 2017)
The U.S. District Court for the Southern District of Florida yesterday entered Final Judgment in a Securities and Exchange Commission case against California-based attorney Owen H. Naccarato for violating the securities registration provisions of the federal securities laws.
The SEC’s complaint alleges that in September 2013, Naccarato issued two opinion letters pursuant to Rule 144 of the Securities Act of 1933 (“Securities Act”) improperly concluding that Global Digital Solutions, Inc. (“Global Digital”), a Florida-based microcap company, was not a shell company and that certain shareholders were not affiliates of Global Digital. The SEC’s complaint further alleges that Naccarato improperly instructed Global Digital’s transfer agent to remove the restrictive legends from these shareholder certificates. Many of the shares were then sold in unregistered public distributions.
Naccarato consented to the entry of the Final Judgment without admitting or denying any of the allegations in the Commission’s complaint. The Final Judgment permanently enjoins Naccarato from violating Sections 5(a) and 5(c) of the Securities Act, and orders him to pay $1,000 in disgorgement, $127.77 in prejudgment interest, and a civil penalty of $10,000.
The Final Judgment also prohibits Naccarato, for a period of five years, from directly or indirectly providing, or receiving compensation from the provision of, professional legal services to any person or entity in connection with the offer or sale of securities pursuant to, or claiming, an exemption under Section 4(a)(1) predicated on Securities Act Rule 144, or any other exemption from the registration provisions of the Securities Act, including, without limitation, participating in the preparation or issuance of any opinion letter related to such offering or sale.
The SEC’s investigation was conducted by Jacqueline M. O’Reilly with assistance from Russell Koonin, and supervised by Thierry Olivier Desmet, all in the Miami Regional Office.