Fed. Sec. L. Rep. P 93,747 Securities and Exchange Commission v. United Financial Group, Inc., Formerly Known as Usi Group, Inc.

This case is before us on an interlocutory appeal authorized by 28 U.S.C. § 1292 (a)(1) and (2). United Financial Group, Inc. (hereinafter “UFG”), et al. appeal from the ruling of the district court in favor of the Securities and Exchange Commission (hereinafter “SEC”) granting a preliminary injunction and appointing a receiver pendente lite. Our opinion is limited to the issues of whether there is subject matter jurisdiction and whether the district judge abused his discretion in granting the relief mentioned. We affirm.

UFG is a Delaware corporation with its headquarters in Novato, California. The individual appellants are officers and directors of UFG and of various of the appellant companies owned by UFG. UFG is a holding company owning and, from its home base in the United States, controlling quite a large number of service and investment companies incorporated in foreign countries. Such investment companies are commonly referred to as “offshore mutual funds.” Most of such funds, including the ones here, have very substantial investments in companies and property in the United States. Many offshore mutual funds were created subsequent to the passage of the Foreign Investors…