SEC Issues Order Involving Lee Cohen

WASHINGTON, May 26 -- The Securities and Exchange Commission issued the following order (No. 3-21467) on May 25, 2023:

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In the Matter of LEE COHEN, Respondent.

ORDER INSTITUTING ADMINISTRATIVE PROCEEDINGS PURSUANT TO SECTION 15(b) OF THE SECURITIES EXCHANGE ACT OF 1934 AND NOTICE OF HEARING

I.

The Securities and Exchange Commission ("Commission") deems it appropriate and in the public interest that public administrative proceedings be, and hereby are, instituted pursuant to Section 15(b) of the Securities Exchange Act of 1934 ("Exchange Act") against Lee Cohen ("Respondent" or "Cohen").

II.

After an investigation, the Division of Enforcement alleges that:

A. RESPONDENT

1. Cohen, age 52, is a citizen of the United Kingdom. From at least June 2017 through February 2018, he resided in and operated a self-described boiler room from Manila, The Philippines. Cohen has never held any licenses in the financial services industry and has never been registered as or associated with a registered broker-dealer or any other entity registered with the Commission.

B. RESPONDENT'S CRIMINAL CONVICTION

2. On August 1, 2022, Respondent pled guilty to a charge of conspiracy to commit securities fraud, in violation of 15 U.S.C. Sec.Sec. 78j(b) and 78ff, in the United States District Court for the Eastern District of New York, in United States v. Cohen, 1:22-cr-00209-KAM (E.D.N.Y. May 4, 2022). On May 15, 2023, a judgment in the criminal case was entered against Cohen. He was sentenced to a prison term of seventeen months and ordered to make restitution in the amount of $1.2 million.

3. Cohen pled guilty to a count of conspiracy to commit securities fraud in a criminal information, dated May 9, 2022, which superseded a complaint and affidavit in support of an application for an arrest warrant filed under seal on March 9, 2022. With regard to the count of conspiracy to commit securities fraud, the complaint and the superseding criminal information alleged, among other things, that Cohen engaged in a scheme with others to defraud investors and potential investors in the securitities of HD View 360, Inc. ("HD View"), a penny stock company that traded on the over-the-counter markets, by, among other things, manipulating the price and trading volume of HD View shares. The complaint and information alleged that Cohen operated a call room in the Philippines - which he referred to as a "[b]oiler room" - to call individuals in the United States and recommend that they purchase HD View shares at particular prices. Cohen coordinated with another individual, who controlled the majority of HD View's free-trading shares at the time to sell HD View shares at the same prices that Cohen recommended that investors pay to purchase the shares. Cohen received a portion of the proceeds from the sale of HD View shares.

III.

In view of the allegations made by the Division of Enforcement, the Commission deems it necessary and appropriate in the public interest that public administrative proceedings be instituted to determine:

A. Whether the allegations set forth in Section II hereof are true and, in connection therewith, to afford Respondent an opportunity to establish any defenses to such allegations; and

B. What, if any, remedial action is appropriate in the public interest against Respondent pursuant to Section 15(b) of the Exchange Act.

IV.

IT IS ORDERED that a public hearing before the Commission for the purpose of taking evidence on the questions set forth in Section III hereof shall be convened at a time and place to be fixed by further order of the Commission, pursuant to Rule 110 of the Commission's Rules of Practice, 17 C.F.R. Sec. 201.110.

IT IS FURTHER ORDERED that Respondent shall file an Answer to the allegations contained in this Order within twenty (20) days after service of this Order, as provided by Rule 220(b) of the Commission's Rules of Practice, 17 C.F.R. Sec. 201.220(b).

IT IS FURTHER ORDERED that the Division of Enforcement and Respondent shall conduct a prehearing conference pursuant to Rule 221 of the Commission's Rules of Practice, 17 C.F.R. Sec. 201.221, within fourteen (14) days of service of the Answer. The parties may meet in person or participate by telephone or other remote means; following the conference, they shall file a statement with the Office of the Secretary advising the Commission of any agreements reached at said conference. If a prehearing conference was not held, a statement shall be filed with the Office of the Secretary advising the Commission of that fact and of the efforts made to meet and confer.

If Respondent fails to file the directed Answer, or fails to appear at a hearing or conference after being duly notified, the Respondent may be deemed in default and the proceedings may be determined against him upon consideration of this Order, the allegations of which may be deemed to be true as provided by Rules 155(a), 220(f), 221(f) and 310 of the Commission's Rules of Practice, 17 C.F.R. Sec.Sec. 201.155(a), 201.220(f), 201.221(f), and 201.310.

This Order shall be served forthwith upon Respondent Cohen by any means permitted by the Commission's Rules of Practice.

The Commission finds that it would serve the interests of justice and not result in prejudice to any party to provide, pursuant to Rule 100(c) of the Commission's Rules of Practice, 17 C.F.R. Sec. 201.100(c), that notwithstanding any contrary reference in the Rules of Practice to service of paper copies, service to the Division of Enforcement of all opinions, orders, and decisions described in Rule 141, 17 C.F.R. Sec. 201.141, and all papers described in Rule 150(a), 17 C.F.R. Sec. 201.150(a), in these proceedings shall be by email to the attorneys who enter an appearance on behalf of the Division, and not by paper service.

Attention is called to Rule 151(a), (b) and (c) of the Commission's Rules of Practice, 17 C.F.R. Sec. 201.151(a), (b) and (c), providing that when, as here, a proceeding is set before the Commission, all papers (including those listed in the following paragraph) shall be filed electronically in administrative proceedings using the Commission's Electronic Filings in Administrative Proceedings (eFAP) system access through the Commission's website, www.sec.gov, at http://www.sec.gov/eFAP. Respondent also must serve and accept service of documents electronically. All motions, objections, or applications will be decided by the Commission.

The Commission finds that it would serve the interests of justice and not result in prejudice to any party to provide, pursuant to Rule 100(c) of the Commission's Rules of Practice, 17 C.F.R. Sec. 201.100(c), that notwithstanding any contrary reference in the Rules of Practice to filing with or disposition by a hearing officer, all filings, including those under Rules 210, 221, 222, 230, 231, 232, 233, and 250 of the Commission's Rules of Practice, 17 C.F.R. Sec.Sec. 201.210, 221, 222, 230, 231, 232, 233, and 250, shall be directed to and, as appropriate, decided by the Commission. This proceeding shall be deemed to be one under the 75-day timeframe specified in Rule of Practice 360(a)(2)(i), 17 C.F.R. Sec. 201.360(a)(2)(i), for the purposes of applying Rules of Practice 233 and 250, 17 C.F.R. Sec.Sec. 201.233 and 250.

The Commission finds that it would serve the interests of justice and not result in prejudice to any party to provide, pursuant to Rule 100(c) of the Commission's Rules of Practice, 17 C.F.R. Sec. 201.100(c), that the Commission shall issue a decision on the basis of the record in this proceeding, which shall consist of the items listed at Rule 350(a) of the Commission's Rules of Practice, 17 C.F.R. Sec. 201.350(a), and any other document or item filed with the Office of the Secretary and accepted into the record by the Commission. The provisions of Rule 351 of the Commission's Rules of Practice, 17 C.F.R. Sec. 201.351, relating to preparation and certification of a record index by the Office of the Secretary or the hearing officer are not applicable to this proceeding.

The Commission will issue a final order resolving the proceeding after one of the following: (A) The completion of post-hearing briefing in a proceeding where the public hearing has been completed; (B) The completion of briefing on a motion for a ruling on the pleadings or a motion for summary disposition pursuant to Rule 250 of the Commission's Rules of Practice, 17 C.F.R. Sec. 201.250, where the Commission has determined that no public hearing is necessary; or (C) The determination that a party is deemed to be in default under Rule 155 of the Commission's Rules of Practice, 17 C.F.R. Sec. 201.155, and no public hearing is necessary.

In the absence of an appropriate waiver, no officer or employee of the Commission engaged in the performance of investigative or prosecuting functions in this or any factually related proceeding will be permitted to participate or advise in the decision of this matter, except as witness or counsel in proceedings held pursuant to notice. Since this proceeding is not "rule making" within the meaning of Section 551 of the Administrative Procedure Act, it is not deemed subject to the provisions of Section 553 delaying the effective date of any final Commission action.

For the Commission, by its Secretary, pursuant to delegated authority.

Vanessa A. Countryman, Secretary

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Original text here: https://www.sec.gov/litigation/admin/2023/34-97594.pdf