UNITED STATES SECURITIES AND EXCHANGE COMMISSION

SEC ADMIN RELEASES 34-75450, IA 40-4141 / JULY 14, 2015: THE SECURITIES AND EXCHANGE COMMISSION ("COMMISSION") DEEMS IT APPROPRIATE AND IN THE PUBLIC INTEREST THAT PUBLIC ADMINISTRATIVE PROCEEDINGS BE, AND HEREBY ARE, INSTITUTED AGAINST BURGESS NATHANIEL HALLUMS ("HALLUMS" OR "RESPONDENT"). ON THE BASIS OF THIS ORDER AND RESPONDENT'S OFFER, THE COMMISSION FINDS THAT ON NOVEMBER 18, 2013, THE CALIFORNIA SUPERIOR COURT ENTERED A FINAL JUDGMENT AGAINST DEFENDANT BURGESS NATHANIEL HALLUMS IN AN ACTION BROUGHT AGAINST HIM BY THE CALIFORNIA DEPARTMENT OF CORPORATIONS, CASE NO.: 37-2011-00103198-CU-MC-CTL (CAL. SUPER. CT., COUNTY OF SAN DIEGO, NOV. 18, 2013). THE CALIFORNIA SUPERIOR COURT ORDER ENJOINED HALLUMS FROM ENGAGING IN ANY ACT, PRACTICE, OR COURSE OF BUSINESS WHICH IS FRAUDULENT, DECEPTIVE, OR MANIPULATIVE, INCLUDING BUT NOT LIMITED TO, OPERATING A PONZI SCHEME, MISUSING CLIENTS FUNDS, EMPLOYING FRAUDULENT PRACTICES AND ENGAGING IN TRANSACTIONS THAT OPERATE AS A FRAUD TO THE DETRIMENT OF CLIENTS, BARRING HIM FROM FUTURE EMPLOYMENT, MANAGEMENT OR CONTROL OF ANY BROKER DEALER, INVESTMENT ADVISER, OR COMMODITY ADVISER, AND ORDERING HIM TO PAY RESTITUTION OF $10.4 MILLION AND $875,000 IN CIVIL PENALTIES. ON NOVEMBER 18, 2014, HALLUMS PLED GUILTY TO, AND WAS CONVICTED OF, MAKING A FALSE STATEMENT IN CONNECTION WITH THE SALE OF A SECURITY, AND GRAND THEFT OF PERSONAL PROPERTY. ON JANUARY 15, 2015, HALLUMS WAS SENTENCED TO FIVE YEARS AND EIGHT MONTHS IMPRISONMENT, ORDERED TO SERVE FOUR YEARS PAROLE OR POST-RELEASE COMMUNITY SUPERVISION, AND ORDERED TO PAY A $10 MILLION FINE AND MORE THAN $1 MILLION IN RESTITUTION. CALIFORNIA V. BURGESS NATHANIEL HALLUMS, CT NO. CD259775, DA NO. ADU741 (CAL. SUPER. CT., COUNTY OF SAN DIEGO, CENTRAL DIVISION, NOV. 18, 2014).

Order

Bar (Permanent)

SEE COMMENT

7/14/2015

MR. HALLUMS AGREED TO PLEAD GUILTY TO TWO FELONIES-GRAND THEFT FROM PAUL GOODMAN AND SECURITIES FRAUD (25401) FROM ROBERT KING. HE ALSO ADMITTED TO A GREAT TAKING (PC 12022.6(A)(2)) IN THE CASE OF DR. GOODMAN. AS TO BOTH COUNTS, HE ADMITTED THE WHITE COLLAR CRIME ENHANCEMENT (PC 186.11(A)(2). HE ALSO STIPULATED TO RESTITUTION OF OVER $1 MILLION (THE TOTAL OF THE THEFTS FROM KING, GOODMAN, LEARNED, RAGAZZO, AND RAMIREZ).

Pled guilty

FINRA

FINRA RULES 2010, 8210: HALLUMS FAILED TO RESPOND TO FINRA REQUESTS FOR DOCUMENTS AND INFORMATION IN CONNECTION WITH INVESTIGATION INTO ALLEGATIONS THAT HE ENGAGED IN OUTSIDE BUSINESS ACTIVITIES AND/OR PRIVATE SECURITIES TRANSACTIONS. THROUGH COUNSEL, HALLUMS INFORMED FINRA THAT HE WOULD NOT BE PROVIDING A RESPONSE TO FINRA.

Acceptance, Waiver & Consent(AWC)

Bar (Permanent)

All Capacities

6/3/2013

WITHOUT ADMITTING OR DENYING THE FINDINGS, HALLUMS CONSENTED TO THE DESCRIBED SANCTION AND TO THE ENTRY OF FINDINGS; THEREFORE, HE IS BARRED FROM ASSOCIATION WITH ANY FINRA MEMBER IN ANY CAPACITY.

CALIFORNIA DEPARTMENT OF BUSINESS OVERSIGHT

FRAUDULENT, MANIPULATIVE AND DECEPTIVE INVESTMENT ADVISORY ACTIVITIES, INCLUDING PONZI SCHEME.

Order

Bar (Permanent)

ALL CAPACITIES

11/18/2013

Civil and Administrative Penalty(ies)/Fine(s)

$875,000.00

Disgorgement

Restitution

$10,409,046.99

PERMANENT INJUNCTION.