Fed. Sec. L. Rep. P 92,455 Robert W. Nees v. Securities and Exchange Commission, William Reigel v. Securities and Exchange Commission

These two cases, combined on appeal, challenge an order of the Securities and Exchange Commission barring both petitioners from association with any securities broker or dealer. Petitioners, who were salesmen for Century Securities Company, were found to have willfully violated, or to have aided and abetted the violation of, the anti-fraud provisions of § 17(a) of the Securities Act of 1933, 15 U.S.C. § 77q(a) and §§ 10(b) and 15(c) (1) of the Securities Exchange Act of 1934, 15 U.S.C. § 78j (b) and 78o(c) (1).

The securities whose sale triggered the action reviewed here were those of the Jayark Films Corp. (hereafter Jayark), a distribution organization. Two issues of Jayark are involved; the first lot, but not the second, was registered. During the period petitioners were active in selling Jayark, that company was negotiating with Samual Goldwyn Productions for the acquisition of films for television. When an agreement failed to materialize, Jayark unsuccessfully attempted to make a deal with Paramount Pictures Corporation.

The hearing examiner found that petitioner Nees was guilty of “a reckless abandonment and disregard of his obligation for fair dealing in accordance with…