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Appellate Court Reverses Securities Fraud Claim and Permanent Bar Against Former FINRA Board Member Richard Goble

Appellate Court Reverses Securities Fraud Claim and Permanent Bar Against Former FINRA Board Member Richard Goble

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Published by Christopher Simmons
BOCA RATON, Fla., May 30, 2012 (SEND2PRESS NEWSWIRE) -- The Eleventh Circuit Court of Appeals has reversed a District Court's Judgment which found that former FINRA board member Richard Goble, founder and owner of North American Clearing, Inc. ("NACI") engaged in securities fraud, announced his counsel Eric Lee of Lee & Amtzis, P.L. The Appellate Court also reversed the injunction and permanent bar issued by the District Court against Goble.
BOCA RATON, Fla., May 30, 2012 (SEND2PRESS NEWSWIRE) -- The Eleventh Circuit Court of Appeals has reversed a District Court's Judgment which found that former FINRA board member Richard Goble, founder and owner of North American Clearing, Inc. ("NACI") engaged in securities fraud, announced his counsel Eric Lee of Lee & Amtzis, P.L. The Appellate Court also reversed the injunction and permanent bar issued by the District Court against Goble.

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Published by: Christopher Simmons on May 31, 2012
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From Send2PresNewswirePrint Friendly Version
Legal and Law NewsPRESS RELEASE:
Appellate Court Reverses Securities Fraud Claim andPermanent Bar Against Former FINRA Board Member RichardGoble
Wed, 30 May 2012, 14:09:19 EDT
BOCA RATON, Fla., May 30, 2012 (SEND2PRESS NEWSWIRE) --TheEleventh Circuit Court of Appeals has reversed a District Court's Judgmentwhich found that former FINRA board member Richard Goble, founder andowner of North American Clearing, Inc. ("NACI") engaged in securities fraud,announced his counsel Eric Lee of Lee & Amtzis, P.L. The Appellate Court alsoreversed the injunction and permanent bar issued by the District Court againstGoble.NACI was a Florida corporation founded in 1995 with its principal place ofbusiness in Longwood, Florida. NACI was a correspondent brokerage firmregistered with the SEC since 1995. NACI acted as the clearing firm forapproximately 40 small brokerage firms and cleared transactions for more than10,000 customer accounts valued at more than $500 million. At the time theSEC filed its original Complaint in 2008, Goble had no compliance or regulatoryviolations nor any prior warnings by FINRA or the SEC. Goble was a memberof FINRA's board of directors. GOBLE was also a vocal critic of actions being taken by FINRA at the time, including actionstaken by Mary Shapiro who later became head of the SEC. As a result of the SEC's action, Goble was forced to resign fromthe FINRA Board.On May 27, 2008, the SEC obtained an asset freeze and other emergency relief due to allegations of fraudulent misconduct atNACI. The SEC filed a Complaint against GOBLE, NACI's President, Bruce B. Blatman ("Blatman"), and its former financialand operations principal, Timothy J. Ward ("Ward"), charging them with fraud and other securities laws violations. The SEC'sComplaint alleged that the defendants engaged in illegal activities, including the misuse of customer funds, in order to hideNACI's financial problems and to pay for its daily business operations. In addition to the asset freeze, the SEC obtained atemporary restraining order against the defendants and an order appointing a receiver over NACI.After a five day trial in May 2010, on April 27, 2011, the District Court entered its bench trial opinion, which found Goble liablefor committing securities fraud and for aiding and abetting securities laws violations. The District Court permanently restrainedand enjoined Goble for violating securities rules and regulations and barred Goble from engaging in the securities industry inthe future. In its April 2011 opinion, the District Court rejected the SEC's argument that NACI improperly sold customer moneymarket funds to pay its daily operating expenses. However, the District Court found that Goble committed securities fraudbased on a single May 13, 2008 transaction, which also resulted in its finding that Goble aided and abetted securities lawsviolations.In its decision, the Eleventh Circuit found that the transaction at issue was not the result of any misrepresentation and that thetransaction was not in connection with the purchase or sale of securities. The Eleventh Circuit thus determined, as a matter oflaw, that Goble did not commit securities fraud. The Eleventh Circuit affirmed the claim that Goble aided and abetted Wardand Blatman in violating the books and records requirements of Section 17(a) of the Exchange Act, 15 U.S.C. § 78q(a), andRule 17a-3, 17 C.F.R. § 240.17a-3, which required NACI to maintain accurate records. The Appellate Court also vacated theDistrict Court's injunction that barred Goble from procuring a securities license, engaging in the securities business or violating§ 10(b) or Rule 10b-5. The Court also vacated portions of the injunction requiring compliance with the Exchange Act rules.The Eleventh Circuit's opinion, issued almost four years to the day after the SECshut down NACI, vindicates Goble. Based onthe District Court's original Judgment and the Eleventh Circuit's reversal, the SEC shut down a substantial clearing firm thathad over 40 correspondent brokers and serviced over 10,000 customer accounts based solely on a single incident of a books
Page 1of 2PRESS RELEASE: Appellate Court Reverses Securities Fraud Claim and Permanent Bar ...5/30/2012http://send2press.com/newswire/print/news_2012-05-0530-004.shtml

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