SECURITIES AND EXCHANGE COMMISSION Washington, D.C. Litigation Release No. 15814/ July 16, 1998 SECURITIES AND EXCHANGE COMMISSION v. SAM M. ANTAR, ET AL., Civil Action No. 93-3988 (HAA) (D.N.J. July 15, 1998) The Honorable Harold A. Ackerman of the United States District Court for the District of New Jersey issued a 129-page opinion on July 15, 1998, finding in favor of the Securities Exchange Commission on all claims and holding that defendants Sam M. Antar, Allen Antar and Benjamin Kuszer committed insider trading in violation of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5. The decision was based on a 22-day bench trial in September and October 1997. The Court found that the defendants engaged in an extensive, multifaceted fraud beginning in the 1970s and continuing through 1987 at Crazy Eddie, Inc., an electronics retailing chain that at its peak operated forty stores in the greater New York metropolitan area. Defendants' schemes artificially inflated the price of their Crazy Eddie stock holdings, which they sold to unwitting investors for over $27 million. Crazy Eddie was founded in 1969 by Eddie Antar and his father, Sam M. Antar, 75, of West End, New Jersey. Allen Antar, 48, of Oakhurst, New Jersey, is one of Eddie's brothers. Benjamin Kuszer, 48, of Brooklyn, New York, is Eddie's brother- in-law. Judge Ackerman began his opinion as follows: There is perhaps no more insidious drain on the overall welfare of society than greed unchecked. The saga of the Antar family and their operation of a major retail consumer electronics business is but a manifestation of that tenet. In this and related cases, it has become evident that various members of the Antar family engaged in a pattern of fraud and deceit in their attempt to enrich themselves by selling securities, the price of which had been artificially inflated through a multitude of schemes. This appears to be the last chapter in a story of a family and its deception of the public. The Court explicitly rejected the defendants' trial testimony that they were unaware of the frauds that were committed at the company, finding that all three defendants lacked credibility. Judge Ackerman noted specifically with respect to Sam M. Antar, who testified for six days at trial: "Over that time, this court obtained a rather clear sense of him as hardworking, ambitious, and highly intelligent. I also found him to be a skillful and inveterate liar." In addition, the Court ruled in favor of the Commission on its claims against six relief defendants, Rori Antar, Sam A. Antar, Michelle Antar, Adam Kuszer, Sam Kuszer and Simon Kuszer, who are nieces and nephews of Eddie Antar. Judge Ackerman ordered them to disgorge the proceeds -- totaling $3,150,000 -- of Crazy Eddie stock that Eddie sold on their behalf in March 1985 while he was in possession of material, nonpublic information. Although there was no evidence that the relief defendants participated in or were aware of the Crazy Eddie frauds, the Court held that they have no legitimate claim to the fraudulent stock sale proceeds generated on their behalf by Eddie Antar. The Commission sued the defendants and relief defendants for stock sales in which they reaped a total of over $27 million in gross proceeds. The Court stated that it would order full disgorgement of illegal profits by the defendants and relief defendants. The Court also held that the protection of the investing public necessitated that Sam M. Antar, Allen Antar and Benjamin Kuszer be enjoined from any further violations of federal securities laws. Prior Litigation Releases dealing with this and related cases: 15251, 15008, 14431, 14053, 14028, 13958, 13776, 13764, 13723, 13723, 13649, 13509, 13281, 12995, 12723, 12548, 12356, and 12239.