UNITED STATES SECURITIES AND EXCHANGE COMMISSION

SEC Admin Release 34-76594, IA Release 40-4289, December 8, 2015: 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") and Section 203(f) of the Investment Advisers Act of 1940 ("Advisers Act") against Vladimir Eydelman ("Eydelman" or "Respondent"). On March 19, 2014, the Commission filed a complaint naming Eydelman as a defendant, SEC v. Eydelman, et al., Civil Action No. 3:14-cv-01742 (S.D.N.Y.). On October 28, 2015, a final judgment was entered by consent against Eydelman, permanently enjoining him from future violations of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder, and Section 14(e) of the Exchange Act and Rule 14e-3 thereunder. On September 16, 2015, Eydelman pled guilty to one count of securities fraud, one count of tender offer fraud, and one count of conspiracy to commit securities fraud and tender offer fraud in violation of 15 U.S.C. §§ 78j(b), 78n(e), and 78ff, and 17 C.F.R. §§ 240.10b-5 and 240.14e-3(a), and 18 U.S.C. §§ 2 and 371 before the United States District Court for the District of New Jersey in United States v. Eydelman, 14-8079. The counts of the criminal information to which Eydelman pled guilty alleged, among other things, that a law firm employee provided another individual (Eydelman's client) material, nonpublic information relating to at least thirteen different corporate transactions so that Eydelman and the two individuals could profit from this information. The criminal information further alleged that after receiving the material, nonpublic information from his client, Eydelman used it to trade in the securities of the companies involved in the corporate transaction that was the subject of the material, nonpublic information on behalf of himself, his family members, his friends, his client, and other brokerage clients prior to the public announcement of the material, nonpublic information. The criminal information also alleged that Eydelman and the two individuals netted more than approximately $5.6 million in illicit profits by executing trades on behalf of themselves and/or others based on the material, nonpublic information that the law firm employee had obtained from his employer.

Order

Bar (Permanent)

see comment

12/08/2015

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

SEC LITIGATION RELEASE 22948/MARCH 20, 2014: THE SECURITIES AND EXCHANGE COMMISSION CHARGED A STOCKBROKER WITH INSIDER TRADING AROUND MORE THAN A DOZEN MERGERS OR OTHER CORPORATE TRANSACTIONS FOR ILLICIT PROFITS OF $5.6 MILLION DURING A FOUR-YEAR PERIOD. THE SEC ALLEGES THAT VLADIMIR EYDELMAN AND THE OTHER RESPONDENT WERE LINKED THROUGH A MUTUAL FRIEND WHO ACTED AS A MIDDLEMAN IN THE ILLEGAL TRADING SCHEME. THE OTHER RESPONDENT, A MANAGING CLERK AT A LAW FIRM, OBTAINED MATERIAL NONPUBLIC INFORMATION ABOUT CORPORATE CLIENTS INVOLVED IN PENDING DEALS BY ACCESSING CONFIDENTIAL DOCUMENTS IN THE LAW FIRM'S COMPUTER SYSTEM. THE OTHER RESPONDENT TYPICALLY TIPPED THE MIDDLEMAN DURING IN-PERSON MEETINGS, AND THE MIDDLEMAN LATER MET WITH HIS STOCKBROKER, EYDELMAN. THE MIDDLEMAN TIPPED EYDELMAN BY SHOWING HIM A POST-IT NOTE OR NAPKIN WITH THE RELEVANT TICKER SYMBOL. AFTER THE MIDDLEMAN CHEWED UP AND SOMETIMES EVEN ATE THE NOTE OR NAPKIN, EYDELMAN WENT ON TO USE THE ILLICIT TIP TO ILLEGALLY TRADE ON HIS OWN BEHALF AS WELL AS FOR FAMILY MEMBERS, THE MIDDLEMAN, AND OTHER CUSTOMERS. EYDELMAN ALSO LEARNED FROM THE MIDDLEMAN AN APPROXIMATE PRICE OF THE TRANSACTION AND AN APPROXIMATE ANNOUNCEMENT DATE. EYDELMAN BOLSTERED HIS UNLAWFUL PROFITS WITH COMMISSIONS FROM THOSE TRADES. THE SEC ALLEGES THAT EYDELMAN WOULD THEN RETURN TO HIS OFFICE AND TYPICALLY GATHERED RESEARCH ABOUT THE TARGET COMPANY. HE EVENTUALLY EMAILED THE RESEARCH TO THE MIDDLEMAN ALONG WITH HIS PURPORTED THOUGHTS ABOUT WHY BUYING THE STOCK MADE SENSE. THE CONTRIVED EMAILS WERE INTENDED TO CREATE WHAT EYDELMAN AND THE MIDDLEMAN BELIEVED TO BE A SUFFICIENT PAPER TRAIL WITH PLAUSIBLE JUSTIFICATION FOR ENGAGING IN THE TRANSACTION. THE SEC'S COMPLAINT CHARGES EYDELMAN WITH VIOLATING SECTIONS 10(B) AND 14(E) OF THE SECURITIES EXCHANGE ACT OF 1934 AND RULES 10B-5 AND 14E-3 AS WELL AS SECTION 17(A) OF THE SECURITIES ACT OF 1933.

Judgment Rendered

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

Disgorgement

$1,236,657.00

Monetary Penalty other than Fines

Injunction

CONSPIRACY TO COMMIT SECURITIES FRAUD AND TENDER OFFER FRAUD

Pled guilty

SECURITIES FRAUD-INSIDER TRADING

Pled guilty

TENDER OFFER FRAUD

Pled guilty

NASD

NASD RULES 2110, 2440 - RESPONDENT CHARGED EXCESSIVE COMMISSIONS AND MARKUPS ON PRINCIPAL OR AGENCY TRANSACTIONS TOTALLING $102,500 AND IN DETERMINING THE AMOUNT OF COMMISSION OR MARKUP, FAILED TO TAKE INTO ACCOUNT THE FACTORS IDENTIFIED IN CONDUCT RULE IM-2440 WHICH SHOULD BE CONSIDERED IN DETERMINING THE FAIRMESS OF COMMISSIONS AND MARKUPS.

Acceptance, Waiver & Consent(AWC)

Censure

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

Restitution

WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, EYDELMAN CONSENTED TO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS, THEREFORE, HE IS CENSURED, FINED $10,000, AND ORDERED TO PAY $23,845.65 IN RESTITUTION TO PUBLIC CUSTOMERS. THE PAYMENT OF RESTITUTION SHALL OCCUR BEFORE PAYMENT OF THE FINE. FAILURE BY RESPONDENT TO MAKE TIMELY AND CONSECUTIVE MONTHLY PAYMENT OF RESTITUTION OR TO PROVIDE PROOF OF PAYMENT BY THE 20TH DAY OF THE MONTH UNTIL RESTITUTION HAS BEEN PAID IN FULL WILL RESULT IN THE REVOCATION OF ALL RESPONDENT'S NASD REGISTRATIONS. ANY UNDISTRIBUTED RESTITUTION SHALL BE FORWARDED TO THE APPROPRIATE ESCHEAT, UNCLAIMED PROPERTY, OR ABANDONED PROPERTY FUND FOR THE STATE OR COUNTRY IN WHICH THE CUSTOMER LAST RESIDED. FINES PAID ON DECEMBER 01, 2006.

*ALL COMMISSIONS WERE LESS THAN 5%; THERE WERE NO COMPLAINTS FROM ANY OF THESE CUSTOMERS.