The SEC's complaint, which also charges three entities owned and controlled by Morris, alleges violations of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5, and Sections 206(1) and 206(2) of the Investment Advisers Act of 1940. The complaint seeks permanent injunctions against future violations of the federal securities laws, disgorgement of ill-gotten gains with prejudgment interest, and financial penalties.
In a parallel criminal action, the Office of the Attorney General of the State of New York yesterday announced the indictment of Morris and Loglisci. Morris and Loglisci were arrested and criminally charged in a 123-count indictment that included money-laundering, enterprise-corruption and bribery charges. Their attorneys denied the accusations and said they would fight the charges, according to the Wall Street Journal.