The Securities and Exchange Commission (SEC) announced that it filed charges against Macquarie Capital (USA) Inc., a New York-based brokerage firm. Allegedly, Macquarie Capital (USA) Inc. was responsible for underwriting a public offering even though they had obtained a due diligence report indicating that the China-based company’s offering materials had contained false information.
Macquarie Capital (USA) Inc., is an owned subsidiary of a global financial services firm, Macquarie Group Limited. They have agreed to settle the SEC’s charges by paying $15 million and covering the costs of establishing a Fair Fund to compensate investors who suffered losses after purchasing shares in the public offering by Puda Coal.
The former Macquarie Capital managing director, Aaron Black, and former investment banker William Fang, were also charged by the SEC for failing to exercise care in their due diligence. Aaron Black agreed to pay $212,711 and William Fang agreed to pay $35,000 to settle the charges. Aaron Black agreed to be barred from supervisory positions in the securities industry and William Fang agreed to be barred from the securities industry, for at least five years.
The SEC alleges that Macquarie Capital made a profit of $4.17 million as the lead underwriter on the Puda Coal offering, selling stock to investors at a price of $12 per share. When reports about Puda Coal’s false claim appeared on the Internet based on the same PRC filings that Kroll Associates accessed for its report, Puda Coal’s stock price plunged as low as pennies per share.
If you have experienced a financial loss due to Macquarie Capital and/or the public offering by Puda Coal, call Soreide Law Group for a free consultation with an attorney on how to potentially recovery your investment at: 888-760-6552.
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