SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.

SECURITIES EXCHANGE ACT OF 1934
Rel. No. 47357 / February 12, 2003

Admin. Proc. File No. 3-8873

In the Matter of NICHOLAS P. HOWARD

: : : : : :

OPINION OF THE COMMISSION

BROKER-DEALER AND CEASE-AND-DESIST PROCEEDINGS

Grounds for Remedial Action

Aiding and Abetting Fraudulent Closing of Part-or-None Offering

Aiding and Abetting Unlawful Sale to Investment Company

Vice president of registered broker-dealer recklessly aided and abetted the fraudulent closing of a part-or-none offering and the unlawful sale of securities to a registered investment company. Held, it is in the public interest to suspend vice president from association with any broker or dealer for three months, to impose a money penalty of $50,000, and to issue a cease-and-desist order.

APPEARANCES:

Richard D. Marshall and Vincent P. Liberti, of Kirkpatrick & Lockhart LLP, for Nicholas P. Howard.

Yuri B. Zelinsky and Laura B. Josephs, for the Division of Enforcement.

Appeal filed: April 13, 1999
Last brief received: June 25, 1999

I.

Nicholas P. Howard, who during the relevant period was a senior vice president of James Capel, Inc. ("JCI"), a registered broker-dealer, and the Division of Enforcement appeal from the decision of an administrative law judge. The law judge found that, in 1990 and 1991, Howard, in connection with two offerings by JCI of the securities of New Europe Hotels N.V. ("NEH"), aided and abetted and was a cause of violations by JCI and NEH of Section 17(a) of the Securities Act of 1933 ¹ and Section 10(b) of the Securities Exchange Act of 1934 ² and Exchange Act Rules 10b-5 and 10b-9. ³ The law judge also found that Howard aided and abetted and was a cause of a violation by JCI of Section 17(a)(1) of the Investment Company Act of 1940 ("ICA"). ⁴

Howard was suspended for three months from association with any broker or dealer, ordered to pay a money penalty of $50,000, and ordered to cease and desist from further violations. He challenges the law judge's decision. The Division seeks an increase in the length of Howard's suspension. We base our findings on an independent review of the record except for those findings that are not challenged on review.

II.

The facts in this matter are largely undisputed. In 1990 and 1991, JCI and its European affiliates ⁵ (collectively "the Capel Group") marketed two offerings of the securities of NEH, a company formed to acquire, develop, and operate hotel and resort properties in central and eastern Europe. JCI was exclusive sales agent for the offerings in the United States, where they were marketed as private placements, and its affiliates were underwriters for the offerings in Europe.

The first NEH offering was offered and sold in November and December 1990. It closed on January 2, 1991. The offering was made on a "best efforts, part-or-none" basis with a maximum of5,000,000 shares of common stock offered at a price of 20 deutsche marks (DM) per share. To close, the offering required a minimum of 2,500,000 shares to be sold, a figure that was lowered to 2,000,000 in December 1990 due to lagging sales. Subscribers were required to pay for their shares in immediately available funds no later than December 27, 1990. The placement agreement between JCI and NEH provided that, unless subscriptions for at least 2,000,000 shares were received and accepted by January 2, 1991, all funds received from subscribers would be refunded in full.

At the time of the first offering, Howard was in charge of marketing continental European equities to United States institutional investors. He and his group ⁶ telephoned prospective investors, solicited them to purchase NEH stock, and mailed copies of the NEH preliminary offering memorandum ("POM"). Howard also arranged and attended "road shows" at which NEH management presented its business plan to potential investors. He distributed additional copies of the POM at the road shows.

Howard "skimmed through" the POM but did not read it closely. Instead he relied on a two- or three-page "sales brief" or talk sheet, which was largely the work of JCI's corporate finance department. According to Howard, he was not even aware that the NEH offering was being sold on a "part-or-none" basis when he began marketing it. Nor did he know the legal requirements of such an offering.

A. Sales of the NEH offering were unsatisfactory and, in December, concern grew within the Capel Group that even the reduced minimum would not be met. By that time, Howard, who was receiving total sales figures daily, was aware that, if the minimum amount was not sold, there would be no closing. Faced with the impending deadline, the Capel Group decided to buy enough NEH stock to close the offering. On or about December 20, the Group acquired 100,000 shares of NEH in lieu of its 2,000,000 DM fee for acting as selling agent, and bought an additional 55,650 shares of NEH stock for 1,113,000 DM. Howard was aware that the Capel Group was buying in order to meet the offering minimum. He informed investors of the Group's decision to invest, which he regarded as a "marketing plus." In speaking to investors, however, he omitted the information that the Group's purchases would be counted towards the 2,000,000-share minimum, and that the Group made the investment because it concluded that otherwise the closing condition would not be met.

B. NEH retained IDG Development Corporation ("IDG") to serve as development manager for its European projects. As disclosed in the POM, IDG was slated to receive 75,000 free shares of NEH as so-called "founders shares," and had agreed to purchase an additional 75,000 shares at the offering price. As Howard was aware, IDG's 150,000 shares were counted towards the 2,000,000-share offering minimum. In late December 1990, IDG was informed that, because of another investor's objection, it would not receive any free stock and would have to pay the full offering price for its 150,000 shares. As Howard knew, IDG objected to the additional expense of about $1 million.

After discussions between JCI and IDG in which Howard was not involved, IDG proposed a plan whereby NEH would in effect pay IDG's managerial fees in advance from the proceeds of the offering by providing the collateral for bank loans to IDG. In the last week of December, the directors of NEH met by telephone conference call and approved this proposal. Howard, who was an NEH director at that time, did not participate in the conference call but shortly thereafter agreed to the plan after being told that it had been approved by JCI's outside counsel. ⁷

Accordingly, on January 3, 1991, after the close of the offering, NEH purchased a $550,000 certificate of deposit from the Founders Bank of Arizona and assigned it to IDG Europe, Ltd., ⁸ which pledged it to the bank as collateral for a $525,000 loan. On February 4, 1991, NEH deposited $35,000 in a Fountain Bank money market account and purchased a $360,000 Fountain Bank certificate of deposit. It then assigned the account and certificate of deposit to IDG Europe, which pledged them to that bank as collateral for a $360,000 loan. The loan proceeds in the total amount of $885,000 were used to pay for the shares that IDG was originally supposed to receive free of charge. Howard did not inform investors of NEH's agreement to assist IDG, or that IDG's financed shares were counted towards the offering minimum.

C. Before 1990, Howard had participated in the development of the European Warrant Fund ("EWF"), a registered closed-end investment company. Julius Baer Securities, Inc. ("Baer") servedas the fund's investment adviser and, as Howard knew, JCI served as sub-adviser.

During the NEH subscription period, Howard received an indication of interest for 30,000 NEH shares from Markus Schiegg at Baer, on behalf of the EWF. At Howard's direction, a sales assistant filled out an order ticket reflecting that information. Towards the close of the subscription period, Howard contacted subscribers to confirm their orders, but was unable to reach Schiegg who was on vacation. Howard asked Peter Green, JCI's president, how to handle the situation. Green told Howard that JCI would purchase the shares, and that Howard should contact Schiegg when he returned to see if the EWF still wanted the stock. Accordingly, JCI bought the shares which, as Howard was informed in a December 20 memorandum from JCI's corporate finance department, were counted towards the 2,000,000-share offering minimum. No disclosure of these circumstances was made to investors. On January 4, 1991, Howard confirmed the order with Schiegg, and the 30,000 shares were sold by JCI to the EWF.

D. As noted above, full payment for shares in the NEH offering was due in immediately payable funds no later than December 27, 1990. However, a number of investors failed to make payment by that date. ⁹ A December 28 memorandum reflects that more than 13 million DM, a third of the offering proceeds, had not been received by December 27. Howard, who had been on vacation, learned of the problem when he returned to work on January 4. Thereafter, he assisted JCI's efforts to account for and collect the missing funds, a process that took several weeks.

E. JCI made a second offering of NEH securities, this time on a "best efforts" but not a part-or-none basis, in late October and November 1991. By then, Howard had been promoted, and was in charge of all JCI sales. ¹⁰ In connection with the new NEH offering, Howard once again attended "road shows," and he and his staff distributed offering materials to prospective investors. As before, however, Howard merely skimmed through those materials, and relied on JCI's corporate finance department and outside counsel to ensure their accuracy. No disclosure was made to investors in the second offering that the Capel Group had been unable to find enough customers willing to invest in NEH to meetthe first offering's 2,000,000-share minimum, a circumstance that was clearly material to customers trying to determine whether or not to invest in that company.

III.

A. Howard does not dispute the law judge's conclusion that JCI and NEH violated the antifraud provisions charged. Rule 10b-9 requires that a part-or-none offering provide for the prompt return of investor funds if the required minimum proceeds are not raised through bona fide sales to the investing public by the stated deadline. ¹¹ The importance of that rule has been repeatedly stressed by the courts and the Commission. Its provisions assure each investor in a part-or-none offering that his money will be refunded if other investors do not share his views that the risk he is taking is worthwhile and the price he is paying is fair. ¹²

The requirements of a part-or-none offering may not be circumvented by transactions designed to create the appearance of a successful offering in order to avoid the required refund. Such conduct not only violates Rule 10b-9 but also the other antifraud provisions cited above -- Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. ¹³ It is well established that purchases by underwriters or their affiliates arranged for the undisclosed purpose of closing an unsuccessful part-or-none offering are fraudulent. ¹⁴ Similarly, insiders may not use the proceeds ofthe offering to finance purchases by third parties in order to make it appear that the necessary funds have been raised. ¹⁵

When investors did not purchase the 2,000,000-share minimum in the first NEH offering, the Capel Group, with the assistance of NEH, engaged in fraudulent stratagems to close the offering and avoid a refund of subscribers' money. In order to make it appear that the minimum had been reached, the Group took 100,000 NEH shares in lieu of its fees as selling agent, and purchased enough of the remaining unsold stock to reach the number of shares required for closing. Together with NEH, the Group arranged for loans collateralized by the offering proceeds that enabled IDG to make its additional 75,000-share purchase, and JCI purchased additional shares when the EWF indication of interest could not be confirmed. None of these was a bona fide transaction for purposes of meeting the offering minimum.

Antifraud violations also occurred when the first NEH offering was closed even though a third of the offering had not been paid for by the prescribed date. Investors in the second NEH offering were not told that the Capel Group had been unable to find enough customers to meet the first offering's 2,000,000-share minimum. We agree with the law judge that JCI and NEH acted with the requisite scienter, and willfully violated Section 17(a) of the Securities Act, and Section 10(b) of the Exchange Act and Exchange Act Rules 10b-5 and 10b-9.

B. Once primary violations are established, the elements necessary to find that a respondent aided and abetted those violations are (1) a general awareness by the aider and abettor that his role was part of an activity that was improper, and (2)�substantial assistance rendered by the aider and abettor to the violative conduct. ¹⁶ Recklessness is sufficient to satisfythe scienter requirement for aiding and abetting liability. ¹⁷ The law judge found that Howard had no awareness of the requirements of Rule 10b-9. Nevertheless, she concluded that Howard was reckless in failing to disclose material facts to NEH investors.

Howard insists that he was not reckless. He argues that there was no need for him to concern himself with the legalities of the NEH offerings since he reasonably relied on other professionals -- JCI's corporate finance and compliance departments and outside legal counsel -- to ensure that the offerings complied with the securities laws.

As a securities professional, Howard had an ongoing obligation to familiarize himself with pertinent legal requirements in order to protect investors from illegality. As we have stated:

[S]ecurities professionals�.�.�. are part of a highly regulated industry and, as such, required to know the law that is applicable to their conduct within that industry. In light of this requirement, it would make no sense to permit ignorance of the law to serve as a defense.�¹⁸

Thus an aider and abettor may not "escape liability by simply claiming he was ignorant of the securities laws . . . ." ¹⁹ "Knowledge means awareness of the underlying facts, not the labels that the law places on those facts." ²⁰

Howard had full knowledge of the underlying facts. As noted above, he became aware prior to the close of the offering that, if the 2,000,000-share minimum were not met, the offering would fail. In December 1990, as the closing date for the receipt of subscriptions approached, Howard was receiving daily reports of total sales figures. He admitted that "the transaction was struggling," that "conditions became extremely difficult," and that "everyone involved . . . was concerned about closing the transaction."

At that point, faced with the prospect of having to refund investors' money, the Capel Group embarked on frantic efforts to create the appearance that the requisite minimum had been sold to investors. Howard was aware of those efforts. He knew about the Group's purchases of NEH for its own account, JCI's purchase for aftermarket sale to the EWF, and IDG's complaint about paying for additional shares and the arrangement to advance funds to IDG by using the proceeds of the offering. Howard was also aware that all of these transactions were being counted towards the minimum required for closure of the offering.

Howard was in charge of selling the NEH offering, and had an obligation to disclose to NEH investors any material change in the information that had been given to them. ²¹ He acknowledged that the lowering of the NEH minimum from 2,500,000 shares to 2,000,000 due to lagging sales was a material event, and he disclosed that circumstance to investors. However, as noted below, his subsequent disclosure was materially deficient.

Howard was aware that no closing could take place unless subscriptions were received for the reduced minimum of 2,000,000 shares. He also knew that the effort to sell that minimum to investors had failed and that the target would be achieved only through the machinations of interested insiders, creating the appearance of a successful offering. That information was clearly material to investors. Yet Howard recklessly ignored his obligation to make full disclosure. Instead, in an effort to boost sales, he told investors that the Capel Group was itself investing in the offering, suggesting that the Group considered NEH a worthwhile investment. He failed to mention that the only reason for that investment was the Group's desire to reach the minimum in order to salvage the offering.

Howard contends that recklessness does not establish the necessary level of knowledge for aiding and abetting liability where the alleged substantial assistance consists of silence or inaction. However, where there is an obligation to disclose, as was the case here, recklessness satisfies the knowledge requirement. ²² Moreover, as noted below, the assistance rendered by Howard extended beyond silence and inaction.

Howard further argues that he did not render substantial assistance to the violations. He points to the facts that he did not prepare the NEH offering materials, had no role in the decision to close the first offering, did not take part in the conference call in which the rest of the NEH board approved the advances to IDG, and gave his approval to those advances only after being told that outside counsel had approved them.

We think it clear that Howard substantially assisted the violations at issue. Howard led the sales effort for the first NEH offering. Although he did not participate in the decision to close the offering, his failure to disclose that the 2,000,000-share minimum would be met only with the aid of insider stratagems allowed the fraudulent closing to proceed. ²³ Moreover, as a director of NEH, Howard voted to approve the IDG loan scheme, and also played a substantial role in collecting late subscription payments from those whose failure to make timely payment should have aborted the offering. Finally, Howard led the marketing effort for the second NEH offering and distributed offering materials without disclosing to prospective customers that the required minimum for the first offering could not be sold to investors, a fact that would clearly have been material to customers determining whether or not to invest in the second offering.

We conclude that Howard aided and abetted the violations by JCI and NEH of Securities Act Section 17(a), Exchange Act Section 10(b), and Rules 10b-5 and 10b-9. We also find that Howard was a cause of those violations. ²⁴

IV.

Section 17(a)(1) of the ICA prohibits an affiliated person of a registered investment company, acting as principal, from selling any security to that company. Section 2(a)(3)(E) of the ICA ²⁵ defines "affiliated person" of an investment company to include "any investment adviser thereof." As noted above, JCI was an investment adviser to the EWF. Thus, by selling for its own account 30,000 shares of NEH to the EWF shortly after the close of the first offering, JCI willfully violated ICA Section 17(a)(1).

The law judge found that Howard aided and abetted JCI's violation. As in the case of the antifraud violations, she concluded that Howard did not know that the sale to the EWF was unlawful. However, she found that Howard was reckless in not knowing the restrictions applicable to transactions between JCI and the fund it served as investment adviser.

Howard again argues that he was not reckless. He asserts that he reasonably relied on Green, JCI's president, and JCI's compliance department (which was responsible for reviewing order tickets) to prevent violations of the ICA's "complex" and "obscure" provisions. We cannot accept his view that this reliance was reasonable. Howard participated in the creation and development of the EWF and other funds, and was aware that JCI was an investment adviser to the EWF, a relationship with obvious potential for conflicts of interest. We concur with the law judge's assessment that, as an experienced securities professional and a senior JCI sales official, Howard was reckless in not being aware of the basic prohibition that forbids an investment adviser to sell securities as principal to the fund it is advising. Moreover, as noted above, an aider and abettor with knowledge of the underlying facts cannot escape liability by claiming ignorance of the securities laws.

Howard seeks to minimize his role in the sale by asserting that he did nothing more than receive an indication of interest from Baer and pass it along to Green. We find, however, that Howard played a substantial role in the sale. After JCI hadpurchased 30,000 shares of the NEH offering for its own account because it could not confirm the EWF's order before the closing, it was Howard who called Schiegg and confirmed that the EWF still wanted to purchase the stock. The sale to the EWF was then consummated.

We conclude that Howard aided and abetted JCI's violation of Section 17(a)(1) of the ICA. ²⁶

V.

Howard points to the fact that, in two consent orders, we stated that, in applying the term "willful" in Commission administrative proceedings, we evaluate "whether the respondent knew or reasonably should have known under the particular facts and circumstances that his conduct was improper." ²⁷ He argues that, under that standard, his misconduct was not willful. We do not agree.

We have determined that Howard was reckless both in failing to disclose material information to investors, and in failing to recognize the impropriety of JCI's sale of securities as principal to the EWF. Under the circumstances, we think it clear that Howard's violations were willful. ²⁸

VI.

Howard argues that his conduct does not warrant the sanctions that the law judge imposed. He points out that the law judge found that his violations were "not extremely egregious," and that he did not have "a high conscious intent." He further asserts that there is no evidence of unjust enrichment or of harm to others arising from his actions, and that, in view of his otherwise unblemished record in the securities business, there is no basis for the issuance of a cease-and-desist order.

We take a less sanguine view of Howard's conduct. Howard's abdication of his responsibilities as a securities professional resulted in serious violations. Contrary to his claim that no one was harmed or unjustly enriched, it is evident that investors in the first NEH offering were deprived of the refund to which they were entitled, and that investors in the second offering were not informed of a circumstance material to their investment decision, the Capel Group's failure to find enough investors willing to purchase the first offering's 2,000,000-share minimum. Moreover, it is clear that NEH profited at investors' expense.

It appears that Howard currently has a managerial position at another brokerage firm. We consider that a cease-and-desist order with respect to the antifraud provisions is necessary to govern his future activities in the securities business. ²⁹ In light of the foregoing, moreover, we conclude that the other sanctions imposed by the law judge -- the $50,000 money penalty and the three-month suspension from association with any broker or dealer�-- are fully warranted in the public interest.

An appropriate order will issue. ³⁰

By the Commission (Chairman PITT and Commissioners GLASSMAN, ATKINS and CAMPOS); Commissioner GOLDSCHMID not participating.

Jonathan G. Katz
Secretary

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.

SECURITIES EXCHANGE ACT OF 1934
Rel. No. 47357 / February 12, 2003

Admin. Proc. File No. 3-8873

In the Matter of NICHOLAS P. HOWARD

: : : : : :

ORDER IMPOSING REMEDIAL SANCTIONS

On the basis of the Commission's opinion issued this day, it is

ORDERED that Nicholas P. Howard be, and he hereby is, suspended from association with any broker or dealer for a period of three months, effective at the opening of business on February 24, 2003; and it is further

ORDERED that Howard cease and desist from committing or causing any violation or future violation of Section 17(a) of the Securities Act of 1933, and Section 10(b) of the Securities Exchange Act of 1934 and Rules 10b-5 and 10b-9 thereunder; and it is further

ORDERED that, within 30 days of the entry of this order, Howard shall pay a civil money penalty in the amount of $50,000. Such payment shall be (a) made by United States postal money order, certified check, bank cashier's check, or bank money order made payable to the Securities and Exchange Commission; (b) hand-delivered or mailed to the Comptroller, Securities and Exchange Commission, 6432 General Green Way, Suite B, Mail Stop O-3, Alexandria, Virginia 22312; and (c) submitted under cover letter that identifies Howard as a respondent in this proceeding and lists the file number of this proceeding. Copies of the cover letter and check shall be sent to Yuri B. Zelinsky, counsel for the Division of Enforcement, Securities and Exchange Commission, 450 Fifth Street, N.W., Washington, D.C. 20549.

By the Commission.

Jonathan G. Katz
Secretary

_____________________

1	15 U.S.C. § 77q(a).
2	15 U.S.C. § 78j(b).
3	17 C.F.R. §§ 240.10b-5 and 10b-9.
4	15 U.S.C. § 80a-17.
5	The affiliates were James Capel & Company, Ltd., a London-based securities firm, and Van Meer James Capel N.V., a Dutch brokerage firm.
6	Three JCI salesmen reported to Howard.
7	There is conflicting evidence as to whether or not counsel was aware of the plan.
8	IDG Europe was a California limited partnership whose general partner was a wholly-owned IDG subsidiary.
9	As described above, IDG did not make full payment for its shares until sometime in February 1991.
10	As a result of Howard's promotion, about 25 people reported to him.
11	See Securities Exchange Act Rel. No. 11532 (July 11, 1975), 7 SEC Docket 403.
12	See, e.g., SEC v. First Pacific Bancorp, 142 F.3d 1186, 1191 (9th Cir. 1998); Banc One Capital Partners Corp. v. Kneipper, 67 F.3d 1187, 1192-1193 (5th Cir. 1995); A.J. White & Co. v. SEC, 556 F.2d 619, 623 (1st Cir. 1977); Richard H. Morrow, 53 S.E.C. 772, 777 (1998), and the authorities collected in notes 4 and 5 of that decision.
13	See, e.g., C.E. Carlson, Inc. v. SEC, 859 F.2d 1429, 1433-1434 (10th Cir. 1988), and the authorities cited therein; Gallagher & Co., 50 S.E.C. 557, 565-567 (1991), aff'd 963 F.2d 385 (11th Cir. 1992) (Table).
14	See C. Brock Lippitt, 48 S.E.C. 524, 526 (1986), aff'd sub nom. Svalberg v. SEC, 876 F.2d 181 (D.C. Cir. 1989), and thecases cited therein.
15	See SEC v. Blinder, Robinson & Co., 542 F. Supp. 468, 475 (D. Colo. 1982), aff'd, Fed. Sec. L. Rep. (CCH) ¶ 99,491 (10th Cir. 1983).
16	See, e.g., Investors Research Corp. v. SEC, 628 F.2d 168, 178 (D.C. Cir. 1980); Russo Secs. Inc., 53 S.E.C. 271, 278 (1997).
17	Graham v. SEC, 222 F.3d 994, 1004 (D.C. Cir. 2000); Levine v. Diamanthuset, Inc., 950 F.2d 1478, 1483 (9th Cir. 1990).
18	Marc N. Geman, Exchange Act Rel. No. 43963 (Feb. 14, 2001), 74 SEC Docket 999, 1033-1034, appeal pending, No.�01-9512 (10th Cir.). See also Jacob Wonsover, Exchange Act Rel. No. 41123 (Mar. 1, 1999), 69 SEC Docket 694, 712, aff'd, 205 F.3d 408 (D.C. Cir. 2000); Kirk A. Knapp, 51 S.E.C. 115, 134 (1992) ("[P]articipants in the industry must take responsibility for their compliance and cannot be excused for lack of knowledge, understanding, or appreciation of those requirements.").
19	Camp v. Dema, 948 F.2d 455, 459 (8th Cir. 1991).
20	SEC v. Falstaff Brewing Corp., 629 F.2d 62, 77 (D.C. Cir. 1980).
21	See SEC v. Manor Nursing Centers, Inc., 458 F.2d 1082, 1095 (2d Cir. 1972).
22	See, e.g., Camp v. Dema, supra; Cleary v. Perfectune, Inc., 700 F.2d 774, 777 (1st Cir. 1983).
23	See Camp v. Dema, supra, 948 F.2d at 460 ("Silence is included in the substantial assistance calculus if a duty to disclose exists.").
24	As we have previously stated, a finding that a respondentaided and abetted violations necessarily makes him a cause of those violations. See, e.g., Richard D. Chema, 53 S.E.C. 1049, 1059 n.20 (1998).
25	15 U.S.C. § 80a-2.
26	Since Howard was not charged under Section 9(f) of the ICA, we cannot find him a cause of JCI's violation, and no cease-and-desist order can issue with respect to Section 17(a)(1).
27	Credit Suisse First Boston Corp., Securities Act Rel. No. 7498 (Jan. 29, 1998), 66 SEC Docket 1241, 1250 n.4; Christopher LaPorte, Exchange Act Rel. No. 39171 (Sept. 30, 1997), 65 SEC Docket 1623, 1627 n.2.
28	See the court's discussion of willfulness in Wonsover v. SEC, 205 F.3d 408, 413 (D.C. Cir. 2000). The court reiterated its "traditional formulation of willfulness" for purposes of Section 15(b) of the Exchange Act. Citing its prior holding in Gearhart & Otis, Inc. v. SEC, 348 F.2d 798 (D.C. Cir. 1965), the Court noted that "willfully" in that provision "means intentionally committing the act which constitutes the violation," not that "the actor [must] also be aware that he is violating [the law]."
29	See supra, note 26.
30	We have considered all of the arguments advanced by the parties. We have rejected or accepted them to the extent that they are inconsistent or in accord with the views expressed herein.

http://www.sec.gov/litigation/opinions/34-47357.htm