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SEC Prosecutions

SEC Prosecutions

SEC Wins Summary Judgment of IPO Fraud Charges against Attorney and Settles with President of Lead Managing Underwriter; Over $4.9 Million in Penalties, Disgorgement and Interest

SEC v. Thomas T. Prousalis, Jr. and Robert T. Kirk

  • 2005
  • $4.9 Million

This case arose out of a fraudulent scheme to close Busybox.com, Inc.’s IPO after its underwriter, Barron Chase Securities, Inc. (of which defendant Kirk was President and majority owner), failed to sell the full committed allotment of securities to bona fide investors. The scheme involved insider purchases using undisclosed payments styled as bonuses and legal fees. Proceeds to the issuer were reduced by over $2.1 million. Defendant Prousalis was securities counsel for Busybox, and a primary orchestrator and beneficiary of the scheme. In parallel proceedings, Prousalis and Kirk also received prison sentences of 57 and 37 months, respectively, for their conduct.

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