SEC Settles Charges Against Short-Seller

May 9 2008 | 12:20pm ET

The Securities and Exchange Commission has filed a settled civil action against Quogue Capital and Wayne Rothbaum, Quogue's managing member and owner.

The SEC’s complaint alleges that Rothbaum committed multiple violations of a securities rule that prohibits covering a short sale when the short sale occurs during a specific period (usually within five business days) before the pricing of the offering.

Quogue and Rothbaum allegedly violated Rule 105 of Regulation M in connection with purchases of securities in public offerings made by Bioenvision, Geron Corp., Cotherix and Point Therapeutics. The SEC alleges that on each such occasion, Rothbaum sold securities short within five business days before the pricing of public offerings and then covered the short positions with securities purchased in the offering pocketing a total of $782,902 form the trades.

Without admitting or denying the allegations of the complaint, Rothbaum agreed to pay a civil money penalty in the amount of $390,000.

The SEC also instituted settled cease-and-desist and administrative proceedings against Rothbaum, who agreed to the proceedings and paid a disgorgement charge of $782,902 and prejudgment interest of $161,154.


Lifestyle

Survey: Wall Street Banks Still Top Silicon Valley, Hedge Funds for Freshly-Minted MBAs

Jun 21 2016 | 9:01pm ET

Contrary to concerns that Wall Street isn't as appealing to new graduates as it...

Guest Contributor

The Future of the Blockchain in Financial Services Communications

Jun 17 2016 | 1:05pm ET

Over the past year, a large portion of the financial services industry has awakened...