SEC News Digest

ENFORCEMENT PROCEEDINGS

In the Matter of George J. Sandhu, Respondent

On August 7, the Commission issued an Order Making Findings and Imposing Remedial Sanctions Pursuant to Section 203(f) of the Investment Advisers Act (Order) against George J. Sandhu based on the entry of the injunction against him in SEC v. Universal Express, Inc., et al., Civil Action No. 1:04-cv-02322 (Nov. 26, 2007, USDC, SDNY). The Order finds that Sandhu, a resident of New York, was associated with an investment adviser, International Investment Group, LLC, prior to November 2001 and again after January 2003. The Order also finds that according to the Commission's complaint, during 2002, Sandhu wrote two letters to Universal Express, Inc. falsely representing that a mutual fund with which he was associated would invest $7,500,000 in the company's acquisitions, and provide an additional $50,000,000 in long-term financing. Contrary to these representations, the mutual fund had assets of approximately $4,000,000 to $5,000,000. Sandhu also sold shares of Universal Express for third-parties, when no registration statement was in effect. Sandhu was enjoined in the related civil case from violating Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5. [SEC v. Universal Express, Inc., et al., Civil Action No. 1:04-cv-02322, USDC, SDNY] (LR-18636, 20165).

Based on the above, the Order barred Sandhu from association with an investment adviser with the right to reapply in three years. Sandhu consented to the issuance of the Order without admitting or denying any of the findings in the Order, except with respect to the entry of the injunction in the related civil case, which he admitted. (Rel. IA-2768; File No. 3-12910)

In the Matter of WarpRadio, Inc., et al.

An Administrative Law Judge has issued an Order Making Findings and Revoking Registrations by Default as to WellnessAmerica Online, Inc., and Wireless Frontier Internet, Inc. (Default Order), in the matter of WarpRadio, Inc., et al. The Order Instituting Proceedings alleged that WellnessAmerica Online, Inc. (n/k/a General Ventures, Inc.), and Wireless Frontier Internet, Inc., failed repeatedly to file required annual and quarterly reports while their securities were registered with the Securities and Exchange Commission. The Default Order finds these allegations to be true and revokes the registrations of each class of registered securities of these two Respondents, pursuant to Section 12(j) of the Securities Exchange Act of 1934. Administrative Proceeding No. 3-13086. (Rel. 34-58330; File No. 3-13086)

SEC Sues Russian for Scheme to Intrude Into Online Accounts, Manipulate Market

The Commission today filed a complaint in the United States District Court for the District of Connecticut charging thirty-five year old Dmitriy Butko, a Russian resident, with fraudulently manipulating the prices of numerous stocks by using the Internet to intrude into the online brokerage accounts of unsuspecting customers at U.S. broker-dealers.

The complaint alleges that between Oct. 19, 2006 through Nov. 30, 2006, Butko, or others acting in concert, commandeered the online trading accounts of unwitting investors at various broker-dealers, liquidated existing equity positions and, using the resulting proceeds, purchased thinly traded stocks in order to create the appearance of trading activity and pump up the price of the stocks. The complaint further alleges that in five instances, Butko, in his own account, bought shares in the thinly traded issuers just prior to or at the same time that compromised accounts were made to buy shares, creating the false appearance of market activity. Shortly after the intrusions, Butko sold all of his shares at the inflated prices. In all but one of these instances, Butko realized a profit from his trading, netting a total profit of $60,362.

The Commission's action charges Butko with violations of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and seeks permanent injunctive relief, disgorgement and civil monetary penalties.

The SEC's Office of Investor Education and Assistance has previously issued an investor alert, available on the SEC's website, which provides tips for avoiding becoming a victim of an online intrusion. See http://www.sec.gov/investor/pubs/onlinebrokerage.htm.

The Commission acknowledges the assistance of FINRA in this matter. [SEC v. Dmitriy Butko, Civil Action No. 3:08-CV-01201 (D. Conn.)] (LR-20675)

SELF-REGULATORY ORGANIZATIONS

Immediate Effectiveness of Proposed Rule Change

A proposed rule change filed by Chicago Board Options Exchange (SR-CBOE-2008-78) relating to market-maker transaction fees has become effective under Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of August 11. Rel. 34-58321)

Order Granting Approval of a Proposed Rule Change; and Notice of Amendment No. 1 to Three Proposed Rule Changes, and Order Granting Accelerated Approval of Each

Pursuant to Rule 19b-4 under the Securities Exchange Act of 1934, the Boston Stock Exchange filed Amendment No. 1 to a proposed rule change relating to the acquisition of BSE by The NASDAQ OMX Group (SR-BSE-2008-023) and Amendment No. 1 to a proposed rule change relating to a proposal to transfer BSE's ownership interest in Boston Options Exchange Group (SR-BSE-2008-025); and the Boston Stock Exchange Clearing Corporation filed Amendment No. 1 to a proposed rule change relating to amendment of its Articles of Organization and By-Laws in connection with the planned acquisition by NASDAQ OMX (SR-BSECC-2008-01). The Commission granted accelerated approval of each proposed rule change as modified by Amendment No. 1 thereto. The Commission also granted approval of a proposed rule change (SR-BSE-2008-02), as modified by Amendment No. 1 thereto, submitted by the Boston Stock Exchange, amending BSE's Certificate of Incorporation. Publication is expected in the Federal Register during the week of August 11. Rel. 34-58324)

SECURITIES ACT REGISTRATIONS

• Latest Securities Act registrations (TXT)

RECENT 8K FILINGS

• Latest 8-K filings (TXT)

http://www.sec.gov/news/digest/2008/dig080808.htm