Both, the enterprises and their owner Manuel Bello have agreed to reimburse $3.2m of allegedly ill-gotten gains, including interest to settle the SEC’s complaint, without admitting or denying the allegations.
The firms assured the investors either in written or oral that the stock would not be sold as long as they did not default on their loan payments, the accused sold the shares before or soon after making the loans, said the SEC complaint.
During the course of investigation, SEC found that the firms disposed the borrowers’ restricted shares into the market without registering the transactions in at least 35 loan transactions and the firms and Bello themselves failed to register with the SEC as brokers or dealers.
The watchdog further accused Ayuda and AmeriFund for repaying over $3.2m of illegal gains on loans to public company officers and directors who put up stock as collateral.
SEC’s Division of Enforcement Associate Director Scott Friestad said the agency is continuing to clamp down on misconduct in the opaque stock-collateralized lending industry.
"Firms cannot induce borrowers to transfer stock to them as purported collateral for loans but then turn right around and sell the borrowers’ stock into the market to fund their operations," Friestad added.
In connection with the agreement, Bello has also agreed to compensate a $500,000 penalty and has been permanently expelled from the securities industry.