Fed. Sec. L. Rep. P 97,449 United States of America v. Alton Clark Bingham
Opinion
Opinion
Alton Clark Bingham lied about his name when he sold securities through a brokerage firm. We consider whether that lie constituted securities fraud under 17 C.F.R. § 240 .10b-5 (1992) (“Rule 10b-5”).
Bingham sold securities through a brokerage firm under the name of his recently deceased client, Howard Láveme Crow, for whom Bingham had served as an accountant. The securities he sold were issued by Mariah International, Inc., a corporation in which Bingham was an officer and a director. The number of shares sold (66,000) was less than one-half of one percent of the total outstanding shares.
Bingham was indicted on several counts of securities fraud, mail fraud, money laundering, and aiding and assisting in the filing of false tax returns. After a bench trial, he was found guilty on the securities fraud and related mail fraud charges. He was acquitted on the remaining charges.
He now appeals, claiming there was insufficient evidence to support his convictions. We reverse.
To violate Rule 10b-5, a misrepresentation or omission must be material. Information is material if there is “a substantial likelihood that the disclosure [of that information] would have been viewed by the…