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IN THE MATTER OF: JEFFREY ALAN COHAN * * * * * * * * * * * * * * * * * * * |
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CONSENT ORDER CO-2008-7308-S |
PRELIMINARY STATEMENT
WHEREAS, the Banking Commissioner (the “Commissioner”) is charged with the administration of Chapter 672a of the Connecticut General Statutes, the Connecticut Uniform Securities Act (the “Act”), and Sections 36b-31-2 et seq. of the Regulations of Connecticut State Agencies promulgated under the Act (the “Regulations”);
WHEREAS, Jeffrey Alan Cohan (“Cohan”) is currently registered as a broker-dealer agent under the Act;
WHEREAS, Cohan was previously registered as an agent of Buell Securities Corp. (Central Registration Depository number 1342) under the Act from October 1, 1992 to June 2, 2006;
WHEREAS, the Commissioner, through the Securities and Business Investments Division (the “Division”) of the Department of Banking, conducted an investigation (the “Investigation”) pursuant to Section 36b-26(a) of the Act into the alleged activities of Cohan to determine whether Cohan had violated, was violating or was about to violate any provision of the Act or any regulation or order under the Act;
WHEREAS, Section 36b-31(a) of the Act, provides, in relevant part, that “[t]he commissioner may from time to time make … such … orders as are necessary to carry out the provisions of sections 36b-2 to 36b-33, inclusive”;
WHEREAS, Section 4-177(c) of the Connecticut General Statutes provides, in relevant part, that “[u]nless precluded by law, a contested case may be resolved by . . . consent order”;
WHEREAS, the Commissioner finds that the entry of this Consent Order is necessary or appropriate in the public interest or for the protection of investors and consistent with the purposes fairly intended by the policy and provisions of the Act;
WHEREAS, without holding a hearing and without trial or adjudication of any issue of fact or law, and prior to the initiation of any formal proceeding, the Commissioner and Cohan reached an agreement, the terms of which are reflected in this Consent Order, in full and final resolution of the matters described herein;
WHEREAS Cohan, without admitting or denying any of the Commissioner’s allegations or findings, expressly consents to the Commissioner’s jurisdiction under the Act and to the terms of this Consent Order;
WHEREAS Cohan, through his execution of this Consent Order, represents and agrees that none of the violations alleged in this Consent Order shall occur in the future;
ALLEGATIONS
WHEREAS, as a result of the Investigation, the Division obtained evidence that, from December 2005 through April 2006 and while associated with Buell Securities Corp., Cohan violated Section 36b-16 of the Act by executing seventeen transactions in the securities of Lakota Resources, Inc. at a time when such securities were not registered under Sections 36b-17, 36b-18 or 36b-19 of the Act nor the subject of an exemptive claim or claim of covered security status under Section 36b-21 of the Act;
WHEREAS, as a result of the Investigation, the Division also obtained evidence that on November 15, 2005 and while registered as an agent of Buell Securities Corp. under the Act, Cohan violated Section 36b-31-6e of the Regulations by engaging in a private securities transaction without notice to his employing firm. Such private securities transaction involved Cohan transferring $60,000 from one of the Buell Securities Corp. accounts that he handled to a private real estate venture in which Cohan had an interest;
FINDINGS OF THE COMMISSIONER AS TO EVIDENTIARY SUFFICIENCY TO INITIATE ADMINISTRATIVE PROCEEDINGS
WHEREAS, the Commissioner finds that sufficient grounds would exist to initiate administrative proceedings under Sections 36b-15(a)(2)(B), 36b-27(a) and 36b-27(d) of the Act against Cohan based on the following, all of which are more fully described above, and which Cohan neither admits nor denies:
| 1. | From December 2005 through April 2006, Cohan violated Section 36b-16 of the Act by effecting transactions in securities at a time when such securities were not registered under Sections 36b-17, 36b-18 or 36b-19 of the Act nor the subject of an exemptive claim or claim of covered security status under Section 36b-21 of the Act; |
| 2. | Cohan violated Section 36b-31-6e of the Regulations by engaging in a private securities transaction without notice to his employing broker-dealer; |
CONSENT TO WAIVER OF PROCEDURAL RIGHTS
WHEREAS, Cohan, through his execution of this Consent Order, voluntarily waives the following rights:
| 1. |
To receive prior written notice within the meaning of Sections 36b-15(f), 36b-27(a), 36b-27(d) and 4-177(b) of the Connecticut General Statutes; |
| 2. |
To present evidence and argument and to otherwise avail himself of Section 4-177c(a) of the Connecticut General Statutes; |
| 3. | To present his position in a hearing in which he is represented by counsel; |
| 4. | To have a written record of the hearing made and a written decision issued by a hearing officer; and |
| 5. | To seek judicial review of, or otherwise challenge or contest, the matters described herein, including the validity of this Consent Order. |
CONSENT TO ENTRY OF SANCTIONS
WHEREAS, Cohan, through his execution of this Consent Order, consents to the Commissioner’s entry of a Consent Order imposing on him the following sanctions:
| 1. | For three years following the entry of this Consent Order by the Commissioner, Cohan shall not, while associated with any broker-dealer registered under the Act or any investment adviser that is registered under the Act or that has filed an exemptive notice under Section 36b-6(e) of the Act, exercise discretionary trading authority over client funds, securities or accounts. Through his execution of this Consent Order, Cohan undertakes to promptly provide any such broker-dealer or investment adviser with notice of such restriction, including a copy of this Consent Order; |
| 2. | For three years following the entry of this Consent Order by the Commissioner, Cohan shall limit his securities sales activities on behalf of any broker-dealer registered under the Act to securities issued by investment companies subject to regulation under the Investment Company Act of 1940; and to securities listed on the New York Stock Exchange, the American Stock Exchange, the NASDAQ Global Select Market, and the NASDAQ Capital Market. Nothing in this paragraph shall preclude Cohan from purchasing or selling securities not described in this paragraph solely for his own account or the accounts of his immediate family as long as such transactions are not effected with a view toward evading the restrictions in this paragraph. Through his execution of this Consent Order, Cohan undertakes to promptly provide any such broker-dealer with notice of such restriction, including a copy of this Consent Order; |
| 3. | Cohan shall comply in all respects with Section 36b-31-6e of the Regulations, and shall, while associated with any broker-dealer registered under the Act, provide such broker-dealer with a written statement each year, affirming whether or not Cohan has engaged in outside business activity and, if so, describing such activity in full. Through his execution of this Consent Order, Cohan undertakes to promptly provide any such broker-dealer with notice of such obligation, including a copy of this Consent Order; |
| 4. | No later than the date this Consent Order is entered by the Commissioner, Cohan shall remit to the department, by certified check made payable to "Treasurer; State of Connecticut," the sum of five thousand dollars ($5,000.00) as an administrative fine; |
CONSENT ORDER
NOW THEREFORE , the Commissioner enters the following:
| 1. |
The Sanctions set forth above be and are hereby entered; |
| 2. |
If Cohan fails to comply with any term or undertaking in this Consent Order, or if any representation made by Cohan and set forth herein is subsequently determined to be untrue, the Commissioner may initiate administrative or judicial proceedings against Cohan to enforce this Consent Order or to sanction Cohan for violating an order of the Commissioner, or may take any other action authorized under the Act or any other applicable law, including the imposition of fines or penalties as provided by the Act; |
| 3. | This Consent Order shall not preclude additional proceedings by the Commissioner against Cohan for acts or omissions not specifically addressed in this Consent Order or for acts and/or omissions that do not arise from the facts or transactions addressed herein; and |
| 4. | This Consent Order shall become final when issued. |
________/s/_________
Howard F. Pitkin
Banking Commissioner
So ordered at Hartford, Connecticut
this 3rd day of June 2008.
CONSENT TO ENTRY OF ORDER
I, Jeffrey Alan Cohan, state that I have read the foregoing Consent Order; that I know and fully understand its contents; that I agree freely and without threat or coercion of any kind to comply with the terms and conditions stated herein; and that I voluntarily consent to the entry of this Consent Order, expressly waiving any right to a hearing on the matters described herein.
_________/s/_________________
Jeffrey Alan Cohan
On this the 29th day of April 2008, before me, Jeffrey Alan Cohan [sic], the undersigned officer, personally appeared Jeffrey Alan Cohan, known to me (or satisfactorily proven) to be the person whose name is subscribed to the within instrument and acknowledged that he executed the same for the purposes therein contained.
In witness whereof I hereunto set my hand.
____________/s/___________________
Notary Public
Date Commission Expires: Dec. 31, 2009