[PROPOSED] FINAL JUDGMENT AS TO DEFENDANT HOVAN CAPITAL MANAGEMENT, LLC
RICHARD SEEBORG, District Judge.
Plaintiff Securities and Exchange Commission ("Commission"), having filed a complaint in this matter, and defendant Hovan Capital Management, LLC ("defendant" or "HCM") having entered a general appearance and executed the Consent of Defendant Hovan Capital Management, LLC to Entry of Final Judgment ("Consent"), in which among other things, defendant consented to the Court's jurisdiction over it and the subject matter of this action; consented to entry of this Final Judgment without admitting or denying the allegations of the complaint (except as to jurisdiction, which defendant admits); waived findings of fact and conclusions of law; and waived any right to appeal from this Final Judgment:
I.
IT IS HEREBY ORDERED THAT defendant HCM and its agents, servants, employees, attorneys, and those persons in active concert or participation with any of them, who receive actual notice of this Final Judgment, by personal service or otherwise, and each of them, are permanently restrained and enjoined from, directly or indirectly, by the use of any means or instrumentality of interstate commerce, or of the mails, or of any facility of any national securities exchange:
a. employing any device, scheme, or artifice to defraud;
b. making any untrue statement of a material fact or omitting to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading; or
c. engaging in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person;
in connection with the purchase or sale of any security, in violation of Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act"), 15 U.S.C. § 78j(b), and Exchange Act Rule 10b-5 [17 C.F.R. § 240.10b-5.
II.
IT IS FURTHER ORDERED THAT defendant HCM and its agents, servants, employees, attorneys, and those persons in active concert or participation with any of them, who receive actual notice of this Final Judgment, by personal service or otherwise, and each of them, are permanently restrained and enjoined from, directly or indirectly, while acting as an investment adviser, by use of the mails or any means or instrumentality of interstate commerce:
(1) employing any device, scheme, or artifice to defraud any client or prospective client; or
(2) engaging in any transaction, practice, or course of business which operates as a fraud or deceit upon any client or prospective client,
in violation of Section 206(1) and (2) of the Investment Advisers Act of 1940 ("Advisers Act"), 15 U.S.C. §§ 80b-6(1) & (2).
III.
IT IS FURTHER ORDERED THAT defendant HCM and its agents, servants, employees, attorneys, and those persons in active concert or participation with any of them, who receive actual notice of this Final Judgment, by personal service or otherwise, and each of them, are permanently restrained and enjoined from, willfully making any untrue statements of material fact in any registration application or report filed with the Commission under Sections 203, or 204 of the Advisers Act, including but not limited to a Form ADV, or willfully omitting to state in any such registration application or report a material fact which is required to be stated therein, in violation of Section 207 of the Advisers Act, 15 U.S.C. § 80b-7.
IV.
IT IS FURTHER ORDERED THAT defendant HCM and its agents, servants, employees, attorneys, and those persons in active concert or participation with any of them, who receive actual notice of this Final Judgment, by personal service or otherwise, and each of them, are permanently restrained and enjoined from, directly or indirectly, by use of the mails or any means or instrumentality of interstate commerce, while acting as an investment adviser, failing to make or to keep for the prescribed period accurate records prescribed by rule, including but not limited to any communication received relating to a recommendation made or proposed to be made or advice given or proposed to be given, to any client, in violation of Section 204(a) of the Advisers Act, 15 U.S.C. § 80b-4(a), and Advisers Act Rule 204-2(a)(7), 17 C.F.R. § 275.204-2(a)(7).
V.
IT IS FURTHER ORDERED THAT defendant HCM and its agents, servants, employees, attorneys, and those persons in active concert or participation with any of them, who receive actual notice of this Final Judgment, by personal service or otherwise, and each of them, are permanently restrained and enjoined from, while affiliated with a registered investment company, accepting compensation (other than regular salary or wages from a registered investment company) for the purchase or sale of property to or for the registered investment company (or any controlled company thereof), in violation of Section 17(e)(1) of the Investment Company Act of 1940 ("Investment Company Act"), 15 U.S.C. § 80a-17(e)(1).
VI.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant is liable for disgorgement of $12,000, representing money obtained as a result of the conduct alleged in the Complaint, together with prejudgment interest thereon in the amount of $2,942, for a total of $14,942. Defendant shall satisfy this obligation by paying $14,942 to the Securities and Exchange Commission within 14 days after entry of this Final Judgment. Defendant shall make this payment by one of the following means: defendant may transmit payment electronically to the Commission, which will provide detailed ACH transfer/Fedwire instructions upon request. Alternatively, defendant may make payment directly from a bank account via Pay.gov through the SEC website at http://www.sec.gov/about/offices/ofm.htm. Alternatively, defendant may make payment by certified check, bank cashier's check, or United States postal money order payable to the Securities and Exchange Commission, which shall be delivered or mailed to:
Enterprise Services Center
Accounts Receivable Branch
6500 South MacArthur Boulevard
Oklahoma City, OK 73169
and shall be accompanied by a letter identifying the case title, civil action number, and name of this Court; identifying Hovan Capital Management, LLC as a defendant in this action; and specifying that payment is made pursuant to this Final Judgment.
Regardless of the method used for payment, defendant HCM shall simultaneously transmit photocopies of evidence of payment and case identifying information to the Commission's counsel in this action. By making this payment, HCM relinquishes all legal and equitable right, title, and interest in such funds and no part of the funds shall be returned to her. The Commission shall send the funds paid pursuant to this Final Judgment to the United States Treasury. Defendant shall pay post-judgment interest on any delinquent amounts pursuant to 28 USC § 1961.
VII.
IT IS FURTHER ORDERED THAT the Consent is incorporated herein with the same force and effect as if fully set forth herein, and that defendant HCM shall comply with all of the undertakings and agreements set forth therein.
VIII.
IT IS FURTHER ORDERED THAT this Court shall retain jurisdiction of this matter for the purposes of enforcing the terms of this Final Judgment.
IT IS SO ORDERED.
