Free Consent Judgment - District Court of Arizona - Arizona

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 AGREED JUDGMENT AS TO DEFENDANT JOHN M. ADAMS The Securities and Exchange Commission having filed a Complaint and Defendant and Oyate Development, Inc.; et al. Defendants Solely for Purposes of Equitable Relief. vs. U. S. Reservation Bank & Trust; et al. Defendants, Agreed Judgment as to Defendant John M. Adams Plaintiff, Case No. CIV-02-0581 PHX (EHC) IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA PHOENIX DIVISION Securities and Exchange Commission,

22 John M. Adams ("Defendant") having entered a general appearance; consented to the
Agreed Judgment as to John M. Adams SEC vs. U. S. Reservation Bank & Trust, et al. PAGE 1

Case 2:02-cv-00581-EHC

Document 625

Filed 09/26/2006

Page 1 of 5

1 Court's jurisdiction over Defendant and the subject matter of this action; consented to 2 entry of this Agreed Judgment without admitting or denying the allegations of the 3 Complaint (except as to jurisdiction); waived findings of fact and conclusions of law; and 4 waived any right to appeal from this Agreed Judgment: 5 6 I. IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that Defendant, solely in

7 respect to or in connection with the acts of Defendant, and Defendant's agents, servants, 8 employees, attorneys, and all persons in active concert or participation with them who 9 receive actual notice of this Agreed Judgment by personal service or otherwise are 10 permanently restrained and enjoined from violating, directly or indirectly, Section 10(b) 11 of the Securities Exchange Act of 1934 [15 U.S.C. §78j(b)] and Rule 10b-5 promulgated 12 thereunder [17 C.F.R. §240.10b-5], by using any means or instrumentality of interstate 13 commerce, or of the mails, or of any facility of any national securities exchange, in 14 connection with the purchase or sale of any security: 15 16 17 18 19 20 21 22
Agreed Judgment as to John M. Adams SEC vs. U. S. Reservation Bank & Trust, et al. PAGE 2

(a) (b)

to employ any device, scheme, or artifice to defraud; to make any untrue statement of a material fact or to omit to state a

material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading; or (c) to engage in any act, practice, or course of business which operates

or would operate as a fraud or deceit upon any person. II.

Case 2:02-cv-00581-EHC

Document 625

Filed 09/26/2006

Page 2 of 5

1

IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant,

2 solely in respect to or in connection with the acts of Defendant, and Defendant's agents, 3 servants, employees, attorneys, and all persons in active concert or participation with 4 them who receive actual notice of this Agreed Judgment by personal service or otherwise 5 are permanently restrained and enjoined from violating Section 17(a) of the Securities Act 6 of 1933 ("Securities Act") [15 U.S.C. §77q(a)] in the offer or sale of any security by the 7 use of any means or instruments of transportation or communication in interstate 8 commerce or by use of the mails, directly or indirectly: 9 10 11 12 13 14 15 16 17 (a) (b) to employ any device, scheme, or artifice to defraud; to obtain money or property by means of any untrue statement of a

material fact or any omission of a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading; or (c) to engage in any transaction, practice, or course of business which

operates or would operate as a fraud or deceit upon the purchaser. III. IT IS FURTHER ORDERED ADJUDGED AND DECREED that Defendant,

18 solely in respect to or in connection with the acts of Defendant, and his agents, servants, 19 employees, attorneys, and all persons in active concert or participation with him who 20 receive actual notice of this Agreed Judgment by personal service or otherwise, and each 21 of them, are restrained and enjoined from directly or indirectly, engaging in the business 22 of effecting transactions in securities, in the form of investment contracts, or any other
Agreed Judgment as to John M. Adams SEC vs. U. S. Reservation Bank & Trust, et al. PAGE 3

Case 2:02-cv-00581-EHC

Document 625

Filed 09/26/2006

Page 3 of 5

1 security, for his own account or for the account of others, while making use of the mails 2 or any means or instrumentality of interstate commerce to effect any transaction in, or to 3 induce or attempt to induce the purchase or sale of, any security (other than an exempted 4 security or commercial paper, banker's acceptances, or commercial bills) unless 5 Defendant is registered as a broker or dealer in accordance with Section 15(b) of the 6 Exchange Act [15 U.S.C. §78o(b)] and all applicable rules promulgated thereunder or is 7 otherwise exempt from registration under Section 15(a)(1) of the Exchange Act [15 8 U.S.C. §78o(a)(1)]. 9 10 IV. Upon motion of the Commission, the Court shall determine whether it is

11 appropriate to order disgorgement of ill-gotten gains and/or a civil penalty pursuant to 12 Section 20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) of the 13 Exchange Act [15 U.S.C. § 78u(d)(3)] and, if so, the amount(s) of the disgorgement 14 and/or civil penalty. If disgorgement is ordered, Defendant shall pay prejudgment interest 15 thereon, calculated from March 1, 2000, based on the rate of interest used by the Internal 16 Revenue Service for the underpayment of federal income tax as set forth in 26 U.S.C. 17 § 6621(a)(2). In connection with the Commission's motion for disgorgement and/or civil 18 penalties, and at any hearing held on such a motion: (a) Defendant will be precluded from 19 arguing that he did not violate the federal securities laws as alleged in the Complaint; (b) 20 Defendant may not challenge the validity of the Consent or this Agreed Judgment; (c) 21 solely for the purposes of such motion, the allegations of the Complaint shall be accepted 22 as and deemed true by the Court; and (d) the Court may determine the issues raised in the
Agreed Judgment as to John M. Adams SEC vs. U. S. Reservation Bank & Trust, et al. PAGE 4

Case 2:02-cv-00581-EHC

Document 625

Filed 09/26/2006

Page 4 of 5

1 motion on the basis of affidavits, declarations, excerpts of sworn deposition or 2 investigative testimony, and documentary evidence, without regard to the standards for 3 summary judgment contained in Rule 56(c) of the Federal Rules of Civil Procedure. In 4 connection with the Commission's motion for disgorgement and/or civil penalties, the 5 parties may take discovery, including discovery from appropriate non-parties. 6 7 V. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that the Consent is

8 incorporated herein with the same force and effect as if fully set forth herein, and that 9 Defendant shall comply with all of the undertakings and agreements set forth therein. 10 11 VI. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that this Court shall retain

12 jurisdiction of this matter for the purposes of enforcing the terms of this Agreed 13 Judgment. 14 15 VII. There being no just reason for delay, pursuant to Rule 54(b) of the Federal Rules

16 of Civil Procedure, the Clerk is ordered to enter this Agreed Judgment forthwith and 17 without further notice. 18 19 20 21 22
Agreed Judgment as to John M. Adams SEC vs. U. S. Reservation Bank & Trust, et al. PAGE 5

DATED this 25th day of September, 2006.

Case 2:02-cv-00581-EHC

Document 625

Filed 09/26/2006

Page 5 of 5