The part of the document's content:
......hive. Yahoo! is not affiliated with the authors of this page or responsible for its content. Securities Bulletin Summer 07 Jesse White Secretary of State Illinois Securities Department Jefferson Te rrace, Ste. 300A 300 W . Jefferson St. Springfield, IL 62702 800-628-7937 www.cyberdriveillinois.com 69 W . W ashington, Ste. 1220 Chicago, IL 60602 312-793-3384 The Securities Bulletinis a publication of Jesse White, Secretary of State, Illinois Securities Department. Produced by the Secretary of State Communications Department. Printed by authority of the State of Illinois June 2007 8.1M Presorted Standard U.S. Postage PAID Permit #93 Spfld, IL SECURITIES bulletin For many years, state securities adminis-
trators have tracked investment fraud
and published a list of Top 10 Securities
Scams. The No. 1 scam on this years list
is affinity fraud. Each of us has an affinity to some group
an ethnic group, a religious group, a
sports team or a veterans group. The list
reminds us to be vigilant when investing,
even with members of our affinity
groups. Just because a person is a
member of your church or civic organi-
zation doesnt mean a particular invest-
ment they are advocating is right for you
or the person has the qualifications to
be selling investment products. From affinity scams to Internet pump-
and-dump stock schemes to offerings
from unlicensed individuals to unsuit-
able investments, risky investment
opportunities merit your full attention
and research before forking over your
hard-earned cash. Before investing,
make sure your choices match up with
your age, your need for access to the
money, your investment goals and your
risk tolerance. And most importantly,
before committing any money to any
person or organization, be on the safe
side by first checking out the salesper-
son and/or product with the Securities
Department. Remember, if an investment sounds too
good to be true, it
probably is. Jesse White
Secretary of State SUMMER 2007 1. Affinity Fraud Con artists may be members of a particular group or pretend to be members in order to gain a persons trust. Cons often recruit a respected member of a com-
munity or religious congregation to promote their schemes. In many cases, even these lead-
ers become victims of what turns out to be Ponzi schemes. In a recent case, an Illinois pastor
was indicted on 30 counts of securities fraud and theft for luring congregants into a Christian
development investment. 2. Foreign Exchange Trading Foreign exchange (Forex) trading can be legitimate for gov- ernments and businesses concerned about fluctuations in international currencies, and it can
even be appropriate for some individual investors. But the average investor should be wary
when it comes to these complex markets. Forex scams attract customers with sophisticated-
sounding offers placed in newspaper advertisements, on the radio or on Internet sites. 3. Internet Fraud Scammers continue to take advantage of technology to lure investors into pump-and-dump stock schemes. The Securities Department recently issued an order
against an individual who used the Internet to lure investors for a purported movie deal.
Assets of the individual were seized, including a $400,000 home paid for with cash. 4. Investment Seminars Promoters of unsuitable investments are increasingly seeking potential investors particularly senior citizens by offering seminars, many of them prom-
ising a free meal along with higher returns and little or no risk. Unfortunately, in many of the
cases, its just the opposite high risk and no returns. 5. Oil and Gas Scams Rising oil and natural gas prices have made a variety of traditional and alternative energy projects attractive to investors. A recent scam in Southern Illinois
resulted in investors losing millions. The perpetrators are facing criminal prosecution. 6. Promissory Note Schemes Con artists peddling promissory notes promise above-mar- ket interest rates and safety of principal. They often claim that an investors money will be
invested in small businesses, real estate ventures, trading programs and other moneymaking
deals. In reality, the money is spent on the con artists personal expenses. 7. Private Securities Offerings Con artists are increasingly turning to private securities offerings under Rule 506, Regulation D, of the federal Securities Act of 1933 to attract
investors without having to go through the full registration process. Although sometimes
legitimate, these offerings are often risky and at times fraudulent. Generally, private offerings
are designed for financially sophisticated investors. 8. Real Estate Investment Contracts Despite the recent decline in property values, invest- ments in real estate have long been viewed as a sure thing, one with little downside risk
and the potential for substantial returns. Some real estate investments are subject to full reg-
ulation under state and federal securities laws. An investment professional lost his license for
luring investors into a guaranteed safe real estate deal, but instead diverted the money for
a speculative investment in a hotel. 9. Unlicensed Individuals and Unregistered Products Anyone selling securities or provid- ing investment advice about buying or selling securities must be properly licensed. Anyone
engaging in these activities without a valid license should be a red alert for investors. Con
artists also bypass stringent state registration requirements to pitch viatical settlements, pay
telephone and ATM leasing contracts, and other investment contracts with the promise of
limited or no risk and high returns. 10. Unsuitable Investments What might be a suitable investment for one investor may not be right for another. Securities professionals must know their customers financial situations
and refrain from recommending investments that are unsuitable. For example, variable and
equity-indexed annuities are often unsuitable for senior citizens because the products are
generally long-term investments that limit access to invested funds. Top 10 Securities Scams 2007 IN THIS ISSUE TOP 10 SECURITIES SCAMS PETRILLI SENTENCED TO 63 MONTHS FAQ: FOREIGN CURRENCY CONTRACTS MONEY SMART WEEK 2008 RENEWAL FILING DATES A NEWSLETTER OF THE ILLINOIS SECURITIES DEPARTMENT SECRETARY OF STATE JESSE WHITE Securities Department
employees honored Several employees of the Securities Department staff were honored
recently for their years of service to the Office of the Secretary of State
and the people of Illinois. Congratulations to all those honored: 10 years: Director Tanya Solov, John Ertler, Dave Finnigan, Carolyn Jones, James Snell, Cheryl Weiss 15 years: Lynne Bednarko, Dick McDaniel, John Sanders, Dan Tunick 20 years: Marsha Gunn, Lynda Olsen, Myona Thoron 25 years: Michael Fox, Susan LaRussa, Connie Munter, Don Ranger, Diane Walsh 30 years: Albert Coleman SEC expands definition of
covered securities Pursuant to its rule-making authority, the U.S. Securities and
Exchange Commission recently adopted a rule that expands the
definition of covered securities under provisions of the federal
Securities Act of 1933. The expanded definition includes securi-
ties listed, or authorized for listing, on the Nasdaq Capital Market
as covered securities. The change became effective May 24,
2007. Pursuant to provisions of current federal law, covered
securities are exempt from state registration requirements. For
more information, visit www.sec.gov/rules/final/2007/33-8791.pdf. Applicants seeking a waiver for IAR exam requirements
must apply in writing on the prescribed form to the
Securities Department, possess at least 10 years of work
experience in the securities field, and have passed the
Series 7 exam at the time of the waiver application. 2008 Filing Deadlines December 1, 2007
Business Brokers and Loan Brokers Renewal forms
for calendar year 2008 registration due. (Renewal
forms mailed first week of October.) December 31, 2007
Broker/Dealers Designated Principal filing state-
ments due. (Renewal forms mailed third week of
October.) Registered Investment Advisers Designated Principal
filing statements and Reports of Branch Offices due.
(Renewal forms mailed third week of October.) IAR registration requirements (cont. from page 2) Illinois Securities Department 800-628-7937 888-231-1175 (Spanish line) MONEY SMART WEEK IN MAY A celebration of financial education and literacy hosted by the
Federal Reserve Bank of Chicago, Money Smart Week in May has become an annual tradition.
This year, the Securities Department teamed up with several federal agencies and organizations
to offer a Financial Regulators Fair on May 2 in the lobby of the James R. Thompson Center in
downtown Chicago. Participating agencies included the Commodity Futures Trading Commission,
the Federal Deposit Insurance Corporation, the Federal Reserve Bank of Chicago, the Office of
Thrift Supervision, the Securities and Exchange Commission, NASD and the National Futures
Association. Representatives from these agencies were on hand to answer questions from visi-
tors and distribute information on regulator roles in the financial marketplace. Full-text Administrative Orders
are available at www.cyber driveillinois.com (click Departments, Securities,
Administrative Actions). The
orders are filed by date of
action. Following is a summary
of final orders since the last
issue of the Securities Bulletin. Order of Cancellation Geo Securities, Inc.
(CRD# 44830)
5501 Lyndon B. Johnson
Freeway
Dallas, TX 75240 Order to Cease and Desist International Candle Corp.
245 First St.
Cambridge, MA 02142 The Money Doctor System
Carl Shelton
10641 Essex St.
Westchester, IL 60154 Dave Espino
Auctions for Income
15820 Euclid Ave.
Chino, CA 91708 Summary Order to Cease and
Desist Paul Howard
Save Avenue
3200 Hayden Rd.
Scottsdale, AZ 85251 Consent Order of Censure The Shemano Group, Inc.
(BD# 35528)
601 California St., Ste. 1150
San Francisco, CA 94108 Consent Order Michael J. Crook
Z Touch Systems, Inc.
Chicago, IL AEI Environmental, Inc.
D/B/A Livestock Direct, Inc.
105 E. First St.
Hinsdale, IL 60521 Wachovia Capital Markets, LLC
(CRD# 12692)
301 S. College St.
Charlotte, NC Hughes Energy, Inc.
Carl E. Royse
215 SE 3rd St.
Fairfield, IL 62837 John Francis Zelasko
(CRD# 4000109)
3490 W. 79th St.
Indianapolis, IN 46268 Deutsche Asset Management,
Inc. (CRD# 105006)
345 Park Ave.
New York, NY 10154 Deutsche Investment
Management Americas, Inc.
(CRD# 104518)
345 Park Ave.
New York, NY 10154 Siegfried Investment Fund, LLC
Successor in interest to the
Siegfried Investment
Partnership
Barbarossa Investment
Partnership
George S. Rieg VI Order of Denial Cynthia M. Couyoumjian
(CRD# 1456630)
2368 Lassen Way
Tustin, CA 92782 Thomas C. Hock
(CRD# 708167)
4201 E. Wyndemere Cir.
Schnecksville, PA 18078 Final Order of Denial John Green Consulting, Inc.
1229 N. Branch, Ste. 302
Chicago, IL 60622 Corrected Summary Order of
Denial Davis Chapin
(CRD# 28116)
2 Village Square, Ste. 200
Baltimore, MD 21210 Summary Order of Denial Gary L. Pittsford
(CRD# 364258)
4736 Lakewood Hills Dr.
Anderson, IN 46011 Edwin L. Dunn
(CRD# 1087787)
14632 Bournemouth Rd.
Tampa, FL 33626-3322 Philadelphia Investors, Ltd.
(BD# 23905)
1528 Walnut St., Ste. 1500
Philadelphia, PA 19102 Order of Dismissal Deutsche Asset Management,
Inc. (CRD# 105006)
Deutsche Asset Management
Americas, Inc.
(CRD# 104518)
345 Park Ave.
New York, NY 10154 Morgan Stanley DW, Inc.
101 California St., 2nd Fl.
San Francisco, CA 94111 Wachovia Capital Markets, LLC
(CRD# 126292)
301 S. College St.
Charlotte, NC Advantage Financial Partners,
LLC
20 Clark St., 29th Floor
Chicago, IL 60603 Consent Order of Dismissal James Curtis Ackerman
2200 N. Central Rd., Apt. 15E
Fort Lee, NJ 07024 Order of Prohibition and Fine William James Hogan
7813 Sunset Dr.
Elmwood Park, IL 60707 Order of Prohibition Kenneth Lewis
Hip Hop Marketing Group, Inc.
129 Sarona Cir.
Royal Palm Beach, FL 33411-
4319 Frank T. Devine
FCI Sandstone
Federal Correctional Institute
P.O. Box 1000
Sandstone, MN 55072 Global Power Global Wealth
Enterprises, LLC
Global Wealth Investments, LLC
Andre E. Mitchell
4144 Lindell Blvd., Ste. 504
St. Louis, MO 63108 Global Wealth Builders, LLC
Global Wealth Investments, LLC
Global Asset Management &
Multiplier Account Fund
(GAMMA)
Asset Management Income and
Growth Account Fund
(AMIGA)
Andre E. Mitchell
1902 Arsenal St., Ste. 201
St. Louis, MO 63118 Angelina Lazar
8635 W. Sahara Ave., #414
Las Vegas, NV 89117 Angelina Lazar, CEO and
President
Charismatic Exchange, Inc.
7469 W. Lake Mead Blvd., #200
Las Vegas, NV 89117 3960 Howard Hughes Pkwy.,
Ste. 500
Las Vegas, NV 89117 Lakeside Center
2620 Regatta Dr., Ste. 102
Las Vegas, NV 89128 Residual Income
18773 E. State Hwy. 33
Willow Hill, IL 62480 Daniel Passarelli
Million, Inc.
Stateville Correctional Center
P.O. Box 112
Joliet, IL 60434 BuySellEnterpirse.com
Frankline Media and
Technology Group
AE Holdings Corp.
AEH Corp.
4343 N. Clarendon Ave., Ste.
2410
Chicago, IL 60613 Scott Mikros
Mikros Economics Hedge
Fund, LLC
Risk Management International,
LLC
10057 S. Bell Ave.
Chicago, IL 60643 Cambridge Energy Waste
Management, Ltd.
540 Frontage Rd., Ste. 3345
Northfield, IL 60093 Conquest Financial Services Unlimited Cash, Inc.
130 Lombard St.
Oxnard, CA 93030 Douglas Network Enterprises
130 Lombard St.
Oxnard, CA 93030 Sunrise Energy, Inc.
D/B/A Blue Marlin Energy
2901 W. Warner Ave.
Santa Ana, CA 92704 Shea Silva
2901 W. Warner Ave.
Santa Ana, CA 92704 Energy 2000, Inc.
15 W. 6th St., #2010
Tulsa, OK 74119 Jimmey E. Morrisett
15 W. 6th St., #2010
Tulsa, OK 74119 Richard Wells
Wells Financial
1307 6th Ave.
Sterling, IL 61081 2311 E. Lincolnway
Sterling, IL 61081 North American Pipeline Corp.
545 E. John Carpenter
Freeway, Ste. 605
Irving, TX 75062 Patrick R. Beason
545 E. John Carpenter
Freeway, Ste. 605
Irving, TX 75062 Tyrone Bush
8012 S. Langley Ave.
Chicago, IL 60619 Shepherd James
Benhilton Investments Ltd.
83 Kidmore Rd.
Caversham Reading
Berkshire RG4 7NQ UK Alan Frum Ford, CEO
Lonford Ltd.
38 Wigmore St.
London W1U 2HQ UK Charles N. Nenvile
Law Consortium Ltd.
#5 Roundstone St.
Trowbridge, Wiltshire
London BA14 SDH UK Amended Order of
Prohibition and Fine Gary Wayne Hardy
(CRD# 1298371)
Hardy Asset Management
(CRD# 116821)
1711 W. Gary
Chandler, AZ 85224 Order of Revocation Stonington Corp.
(CRD# 35917)
300 Park Ave., Ste. 1700
New York, NY 10022 Steven W. Norin (CRD#
1235892)
2150 Morningside Dr.
Upland, CA 91784 Consent Order of Revocation Terrence P. McCarty
(CRD# 325295)
326 S. Derbyshire Ln.
Arlington Heights, IL 60004 Settlement Agreement Morgan Stanley DW, Inc.
101 California St., 2nd Floor
San Francisco, CA 94111 Order to Vacate John Green Consulting, Inc.
1229 N. Branch, Ste. 302
Chicago, IL 60622 Consent Order of Withdrawal Matthew R. Nall
(CRD# 2528568)
11309 Black Walnut Pt.
Indianapolis, IN 46236 Douglas E. Loner
(CRD# 1648730)
705 Hemlock Ln.
Rockford, IL 61107 Michael A. Strulson
(CRD# 2677763)
34 Linda Ln.
Aston, PA 19014 Timothy R. Touloukian
(CRD# 2803832)
305 W. 63rd St., Apt. 6N
New York, NY 10021 Lawrence M. Labine
(CRD# 1279935)
104 E. Corrine Dr.
Scottsdale, AZ 85259 Patricia C. Fanella
(CRD# 2291152)
1272 Hillcrest Blvd.
Millbrae, CA 94030 Steven A. Bencivenga, Jr.
(CRD# 3000161)
8107 10th Ave.
Brooklyn, NY 11228 Consent Order of Withdrawal
of Application Gary L. Pittsford
(CRD# 364258)
4736 Lakewood Hills Dr.
Anderson, IN 46011 Kevin D. Wells
(CRD# 4180930)
419 Court North Dr.
Melville, NY 11747 Edwin L. Dunn
(CRD# 1087787)
14632 Bournemouth Rd.
Tampa, FL 33626-3322 Enforcement Administrative Orders Petrilli sentenced to 63 months Daniel G. Petrilli, a former Springfield stockbroker and financial advisor, was sen-
tenced in January to 63 months in prison for defrauding seven clients from
October 1993 to December 2004. He persuaded his clients, including an elderly widow, to allow him to invest their
money, promising better returns than the clients were making at the time. He
deposited his clients money into an account he controlled and spent the money
on operating a Springfield tavern and cash gifts to his wife, girlfriend and friends.
He used money from one client to pay another to create the impression that he
had invested the first clients money and the investment was generating income. The Securities Department worked with the U.S. Attorney Central District of Illinois
and the U.S. Postal Inspection Service in investigating the case, which was prose-
cuted by Assistant U.S. Attorney Gregory K. Harris. IAR registration requirements Registration as an investment adviser representative (IAR) with the Securities
Department is governed by Section 8 of the Illinois Securities Law of 1953 and its
related administrative rules. Examination requirements include passage of the
Uniform Investment Adviser Examination (Series 65 exam) or the General
Securities Examination (Series 7 exam), in addition to the Uniform Combined
State Law Examination (Series 66 exam). The following professional designations also are accepted in lieu of the qualifying
examinations: CFP, ChFC, PFS, CFA and CIC. An individual wishing to register using a
professional designation, or who is updating Form U4 to reflect attaining a profes-
sional designation after registration has been granted, should ask his or her
employing firm to contact the respective designating authority and request that
confirmation be sent to NASD regarding the designation. This action must occur
prior to any amendment filing for Form U4 reflecting this professional designation. F A Q What is a foreign currency con-
tract? Investments in foreign currency
contracts, or Forex, involve the
right to buy or sell a certain
amount of a foreign currency at
a fixed price in U.S. dollars.
Profits and losses come as the
exchange rate of that currency
rises and falls on the open mar-
ket. Large banks, multinational
corporations, governments and
speculators are typical investors
in the Forex marketplace. Even
when purchased through a legiti-
mate dealer, Forex investments
are very risky and scams are
common. How does a Forex scam work? Scammers lure investors with the
claim of high rates of return and
the right to control a large
amount of foreign currency at
only a fraction of the total cost.
Oftentimes, the investors money
is never actually placed in the
market through a legitimate deal-
er, but rather simply stolen by
the con artists. How do I avoid a Forex scam? Be skeptical of unsolicited phone
calls, especially those from out-
of-state salespersons. Beware of
promises of six-figure profits
and very low risk and high-
pressure sales tactics. Call the
Securities Department to make
sure anyone offering Forex
investments is registered and has
a reputable business history. Do
your homework and understand
the investment before you
invest. Foreign currency contracts (cont. on page 4) MONEY SMART WEEK IN MAY A celebration of financial education and literacy hosted by the
Federal Reserve Bank of Chicago, Money Smart Week in May has become an annual tradition.
This year, the Securities Department teamed up with several federal agencies and organizations
to offer a Financial Regulators Fair on May 2 in the lobby of the James R. Thompson Center in
downtown Chicago. Participating agencies included the Commodity Futures Trading Commission,
the Federal Deposit Insurance Corporation, the Federal Reserve Bank of Chicago, the Office of
Thrift Supervision, the Securities and Exchange Commission, NASD and the National Futures
Association. Representatives from these agencies were on hand to answer questions from visi-
tors and distribute information on regulator roles in the financial marketplace. Full-text Administrative Orders
are available at www.cyber driveillinois.com (click Departments, Securities,
Administrative Actions). The
orders are filed by date of
action. Following is a summary
of final orders since the last
issue of the Securities Bulletin. Order of Cancellation Geo Securities, Inc.
(CRD# 44830)
5501 Lyndon B. Johnson
Freeway
Dallas, TX 75240 Order to Cease and Desist International Candle Corp.
245 First St.
Cambridge, MA 02142 The Money Doctor System
Carl Shelton
10641 Essex St.
Westchester, IL 60154 Dave Espino
Auctions for Income
15820 Euclid Ave.
Chino, CA 91708 Summary Order to Cease and
Desist Paul Howard
Save Avenue
3200 Hayden Rd.
Scottsdale, AZ 85251 Consent Order of Censure The Shemano Group, Inc.
(BD# 35528)
601 California St., Ste. 1150
San Francisco, CA 94108 Consent Order Michael J. Crook
Z Touch Systems, Inc.
Chicago, IL AEI Environmental, Inc.
D/B/A Livestock Direct, Inc.
105 E. First St.
Hinsdale, IL 60521 Wachovia Capital Markets, LLC
(CRD# 12692)
301 S. College St.
Charlotte, NC Hughes Energy, Inc.
Carl E. Royse
215 SE 3rd St.
Fairfield, IL 62837 John Francis Zelasko
(CRD# 4000109)
3490 W. 79th St.
Indianapolis, IN 46268 Deutsche Asset Management,
Inc. (CRD# 105006)
345 Park Ave.
New York, NY 10154 Deutsche Investment
Management Americas, Inc.
(CRD# 104518)
345 Park Ave.
New York, NY 10154 Siegfried Investment Fund, LLC
Successor in interest to the
Siegfried Investment
Partnership
Barbarossa Investment
Partnership
George S. Rieg VI Order of Denial Cynthia M. Couyoumjian
(CRD# 1456630)
2368 Lassen Way
Tustin, CA 92782 Thomas C. Hock
(CRD# 708167)
4201 E. Wyndemere Cir.
Schnecksville, PA 18078 Final Order of Denial John Green Consulting, Inc.
1229 N. Branch, Ste. 302
Chicago, IL 60622 Corrected Summary Order of
Denial Davis Chapin
(CRD# 28116)
2 Village Square, Ste. 200
Baltimore, MD 21210 Summary Order of Denial Gary L. Pittsford
(CRD# 364258)
4736 Lakewood Hills Dr.
Anderson, IN 46011 Edwin L. Dunn
(CRD# 1087787)
14632 Bournemouth Rd.
Tampa, FL 33626-3322 Philadelphia Investors, Ltd.
(BD# 23905)
1528 Walnut St., Ste. 1500
Philadelphia, PA 19102 Order of Dismissal Deutsche Asset Management,
Inc. (CRD# 105006)
Deutsche Asset Management
Americas, Inc.
(CRD# 104518)
345 Park Ave.
New York, NY 10154 Morgan Stanley DW, Inc.
101 California St., 2nd Fl.
San Francisco, CA 94111 Wachovia Capital Markets, LLC
(CRD# 126292)
301 S. College St.
Charlotte, NC Advantage Financial Partners,
LLC
20 Clark St., 29th Floor
Chicago, IL 60603 Consent Order of Dismissal James Curtis Ackerman
2200 N. Central Rd., Apt. 15E
Fort Lee, NJ 07024 Order of Prohibition and Fine William James Hogan
7813 Sunset Dr.
Elmwood Park, IL 60707 Order of Prohibition Kenneth Lewis
Hip Hop Marketing Group, Inc.
129 Sarona Cir.
Royal Palm Beach, FL 33411-
4319 Frank T. Devine
FCI Sandstone
Federal Correctional Institute
P.O. Box 1000
Sandstone, MN 55072 Global Power Global Wealth
Enterprises, LLC
Global Wealth Investments, LLC
Andre E. Mitchell
4144 Lindell Blvd., Ste. 504
St. Louis, MO 63108 Global Wealth Builders, LLC
Global Wealth Investments, LLC
Global Asset Management &
Multiplier Account Fund
(GAMMA)
Asset Management Income and
Growth Account Fund
(AMIGA)
Andre E. Mitchell
1902 Arsenal St., Ste. 201
St. Louis, MO 63118 Angelina Lazar
8635 W. Sahara Ave., #414
Las Vegas, NV 89117 Angelina Lazar, CEO and
President
Charismatic Exchange, Inc.
7469 W. Lake Mead Blvd., #200
Las Vegas, NV 89117 3960 Howard Hughes Pkwy.,
Ste. 500
Las Vegas, NV 89117 Lakeside Center
2620 Regatta Dr., Ste. 102
Las Vegas, NV 89128 Residual Income
18773 E. State Hwy. 33
Willow Hill, IL 62480 Daniel Passarelli
Million, Inc.
Stateville Correctional Center
P.O. Box 112
Joliet, IL 60434 BuySellEnterpirse.com
Frankline Media and
Technology Group
AE Holdings Corp.
AEH Corp.
4343 N. Clarendon Ave., Ste.
2410
Chicago, IL 60613 Scott Mikros
Mikros Economics Hedge
Fund, LLC
Risk Management International,
LLC
10057 S. Bell Ave.
Chicago, IL 60643 Cambridge Energy Waste
Management, Ltd.
540 Frontage Rd., Ste. 3345
Northfield, IL 60093 Conquest Financial Services Unlimited Cash, Inc.
130 Lombard St.
Oxnard, CA 93030 Douglas Network Enterprises
130 Lombard St.
Oxnard, CA 93030 Sunrise Energy, Inc.
D/B/A Blue Marlin Energy
2901 W. Warner Ave.
Santa Ana, CA 92704 Shea Silva
2901 W. Warner Ave.
Santa Ana, CA 92704 Energy 2000, Inc.
15 W. 6th St., #2010
Tulsa, OK 74119 Jimmey E. Morrisett
15 W. 6th St., #2010
Tulsa, OK 74119 Richard Wells
Wells Financial
1307 6th Ave.
Sterling, IL 61081 2311 E. Lincolnway
Sterling, IL 61081 North American Pipeline Corp.
545 E. John Carpenter
Freeway, Ste. 605
Irving, TX 75062 Patrick R. Beason
545 E. John Carpenter
Freeway, Ste. 605
Irving, TX 75062 Tyrone Bush
8012 S. Langley Ave.
Chicago, IL 60619 Shepherd James
Benhilton Investments Ltd.
83 Kidmore Rd.
Caversham Reading
Berkshire RG4 7NQ UK Alan Frum Ford, CEO
Lonford Ltd.
38 Wigmore St.
London W1U 2HQ UK Charles N. Nenvile
Law Consortium Ltd.
#5 Roundstone St.
Trowbridge, Wiltshire
London BA14 SDH UK Amended Order of
Prohibition and Fine Gary Wayne Hardy
(CRD# 1298371)
Hardy Asset Management
(CRD# 116821)
1711 W. Gary
Chandler, AZ 85224 Order of Revocation Stonington Corp.
(CRD# 35917)
300 Park Ave., Ste. 1700
New York, NY 10022 Steven W. Norin (CRD#
1235892)
2150 Morningside Dr.
Upland, CA 91784 Consent Order of Revocation Terrence P. McCarty
(CRD# 325295)
326 S. Derbyshire Ln.
Arlington Heights, IL 60004 Settlement Agreement Morgan Stanley DW, Inc.
101 California St., 2nd Floor
San Francisco, CA 94111 Order to Vacate John Green Consulting, Inc.
1229 N. Branch, Ste. 302
Chicago, IL 60622 Consent Order of Withdrawal Matthew R. Nall
(CRD# 2528568)
11309 Black Walnut Pt.
Indianapolis, IN 46236 Douglas E. Loner
(CRD# 1648730)
705 Hemlock Ln.
Rockford, IL 61107 Michael A. Strulson
(CRD# 2677763)
34 Linda Ln.
Aston, PA 19014 Timothy R. Touloukian
(CRD# 2803832)
305 W. 63rd St., Apt. 6N
New York, NY 10021 Lawrence M. Labine
(CRD# 1279935)
104 E. Corrine Dr.
Scottsdale, AZ 85259 Patricia C. Fanella
(CRD# 2291152)
1272 Hillcrest Blvd.
Millbrae, CA 94030 Steven A. Bencivenga, Jr.
(CRD# 3000161)
8107 10th Ave.
Brooklyn, NY 11228 Consent Order of Withdrawal
of Application Gary L. Pittsford
(CRD# 364258)
4736 Lakewood Hills Dr.
Anderson, IN 46011 Kevin D. Wells
(CRD# 4180930)
419 Court North Dr.
Melville, NY 11747 Edwin L. Dunn
(CRD# 1087787)
14632 Bournemouth Rd.
Tampa, FL 33626-3322 Enforcement Administrative Orders Petrilli sentenced to 63 months Daniel G. Petrilli, a former Springfield stockbroker and financial advisor, was sen-
tenced in January to 63 months in prison for defrauding seven clients from
October 1993 to December 2004. He persuaded his clients, including an elderly widow, to allow him to invest their
money, promising better returns than the clients were making at the time. He
deposited his clients money into an account he controlled and spent the money
on operating a Springfield tavern and cash gifts to his wife, girlfriend and friends.
He used money from one client to pay another to create the impression that he
had invested the first clients money and the investment was generating income. The Securities Department worked with the U.S. Attorney Central District of Illinois
and the U.S. Postal Inspection Service in investigating the case, which was prose-
cuted by Assistant U.S. Attorney Gregory K. Harris. IAR registration requirements Registration as an investment adviser representative (IAR) with the Securities
Department is governed by Section 8 of the Illinois Securities Law of 1953 and its
related administrative rules. Examination requirements include passage of the
Uniform Investment Adviser Examination (Series 65 exam) or the General
Securities Examination (Series 7 exam), in addition to the Uniform Combined
State Law Examination (Series 66 exam). The following professional designations also are accepted in lieu of the qualifying
examinations: CFP, ChFC, PFS, CFA and CIC. An individual wishing to register using a
professional designation, or who is updating Form U4 to reflect attaining a profes-
sional designation after registration has been granted, should ask his or her
employing firm to contact the respective designating authority and request that
confirmation be sent to NASD regarding the designation. This action must occur
prior to any amendment filing for Form U4 reflecting this professional designation. F A Q What is a foreign currency con-
tract? Investments in foreign currency
contracts, or Forex, involve the
right to buy or sell a certain
amount of a foreign currency at
a fixed price in U.S. dollars.
Profits and losses come as the
exchange rate of that currency
rises and falls on the open mar-
ket. Large banks, multinational
corporations, governments and
speculators are typical investors
in the Forex marketplace. Even
when purchased through a legiti-
mate dealer, Forex investments
are very risky and scams are
common. How does a Forex scam work? Scammers lure investors with the
claim of high rates of return and
the right to control a large
amount of foreign currency at
only a fraction of the total cost.
Oftentimes, the investors money
is never actually placed in the
market through a legitimate deal-
er, but rather simply stolen by
the con artists. How do I avoid a Forex scam? Be skeptical of unsolicited phone
calls, especially those from out-
of-state salespersons. Beware of
promises of six-figure profits
and very low risk and high-
pressure sales tactics. Call the
Securities Department to make
sure anyone offering Forex
investments is registered and has
a reputable business history. Do
your homework and understand
the investment before you
invest. Foreign currency contracts (cont. on page 4) Jesse White Secretary of State Illinois Securities Department Jefferson Te rrace, Ste. 300A 300 W . Jefferson St. Springfield, IL 62702 800-628-7937 www.cyberdriveillinois.com 69 W . W ashington, Ste. 1220 Chicago, IL 60602 312-793-3384 The Securities Bulletinis a publication of Jesse White, Secretary of State, Illinois Securities Department. Produced by the Secretary of State Communications Department. Printed by authority of the State of Illinois June 2007 8.1M Presorted Standard U.S. Postage PAID Permit #93 Spfld, IL SECURITIES bulletin For many years, state securities adminis-
trators have tracked investment fraud
and published a list of Top 10 Securities
Scams. The No. 1 scam on this years list
is affinity fraud. Each of us has an affinity to some group
an ethnic group, a religious group, a
sports team or a veterans group. The list
reminds us to be vigilant when investing,
even with members of our affinity
groups. Just because a person is a
member of your church or civic organi-
zation doesnt mean a particular invest-
ment they are advocating is right for you
or the person has the qualifications to
be selling investment products. From affinity scams to Internet pump-
and-dump stock schemes to offerings
from unlicensed individuals to unsuit-
able investments, risky investment
opportunities merit your full attention
and research before forking over your
hard-earned cash. Before investing,
make sure your choices match up with
your age, your need for access to the
money, your investment goals and your
risk tolerance. And most importantly,
before committing any money to any
person or organization, be on the safe
side by first checking out the salesper-
son and/or product with the Securities
Department. Remember, if an investment sounds too
good to be true, it
probably is. Jesse White
Secretary of State SUMMER 2007 1. Affinity Fraud Con artists may be members of a particular group or pretend to be members in order to gain a persons trust. Cons often recruit a respected member of a com-
munity or religious congregation to promote their schemes. In many cases, even these lead-
ers become victims of what turns out to be Ponzi schemes. In a recent case, an Illinois pastor
was indicted on 30 counts of securities fraud and theft for luring congregants into a Christian
development investment. 2. Foreign Exchange Trading Foreign exchange (Forex) trading can be legitimate for gov- ernments and businesses concerned about fluctuations in international currencies, and it can
even be appropriate for some individual investors. But the average investor should be wary
when it comes to these complex markets. Forex scams attract customers with sophisticated-
sounding offers placed in newspaper advertisements, on the radio or on Internet sites. 3. Internet Fraud Scammers continue to take advantage of technology to lure investors into pump-and-dump stock schemes. The Securities Department recently issued an order
against an individual who used the Internet to lure investors for a purported movie deal.
Assets of the individual were seized, including a $400,000 home paid for with cash. 4. Investment Seminars Promoters of unsuitable investments are increasingly seeking potential investors particularly senior citizens by offering seminars, many of them prom-
ising a free meal along with higher returns and little or no risk. Unfortunately, in many of the
cases, its just the opposite high risk and no returns. 5. Oil and Gas Scams Rising oil and natural gas prices have made a variety of traditional and alternative energy projects attractive to investors. A recent scam in Southern Illinois
resulted in investors losing millions. The perpetrators are facing criminal prosecution. 6. Promissory Note Schemes Con artists peddling promissory notes promise above-mar- ket interest rates and safety of principal. They often claim that an investors money will be
invested in small businesses, real estate ventures, trading programs and other moneymaking
deals. In reality, the money is spent on the con artists personal expenses. 7. Private Securities Offerings Con artists are increasingly turning to private securities offerings under Rule 506, Regulation D, of the federal Securities Act of 1933 to attract
investors without having to go through the full registration process. Although sometimes
legitimate, these offerings are often risky and at times fraudulent. Generally, private offerings
are designed for financially sophisticated investors. 8. Real Estate Investment Contracts Despite the recent decline in property values, invest- ments in real estate have long been viewed as a sure thing, one with little downside risk
and the potential for substantial returns. Some real estate investments are subject to full reg-
ulation under state and federal securities laws. An investment professional lost his license for
luring investors into a guaranteed safe real estate deal, but instead diverted the money for
a speculative investment in a hotel. 9. Unlicensed Individuals and Unregistered Products Anyone selling securities or provid- ing investment advice about buying or selling securities must be properly licensed. Anyone
engaging in these activities without a valid license should be a red alert for investors. Con
artists also bypass stringent state registration requirements to pitch viatical settlements, pay
telephone and ATM leasing contracts, and other investment contracts with the promise of
limited or no risk and high returns. 10. Unsuitable Investments What might be a suitable investment for one investor may not be right for another. Securities professionals must know their customers financial situations
and refrain from recommending investments that are unsuitable. For example, variable and
equity-indexed annuities are often unsuitable for senior citizens because the products are
generally long-term investments that limit access to invested funds. Top 10 Securities Scams 2007 IN THIS ISSUE TOP 10 SECURITIES SCAMS PETRILLI SENTENCED TO 63 MONTHS FAQ: FOREIGN CURRENCY CONTRACTS MONEY SMART WEEK 2008 RENEWAL FILING DATES A NEWSLETTER OF THE ILLINOIS SECURITIES DEPARTMENT SECRETARY OF STATE JESSE WHITE Securities Department
employees honored Several employees of the Securities Department staff were honored
recently for their years of service to the Office of the Secretary of State
and the people of Illinois. Congratulations to all those honored: 10 years: Director Tanya Solov, John Ertler, Dave Finnigan, Carolyn Jones, James Snell, Cheryl Weiss 15 years: Lynne Bednarko, Dick McDaniel, John Sanders, Dan Tunick 20 years: Marsha Gunn, Lynda Olsen, Myona Thoron 25 years: Michael Fox, Susan LaRussa, Connie Munter, Don Ranger, Diane Walsh 30 years: Albert Coleman SEC expands definition of
covered securities Pursuant to its rule-making authority, the U.S. Securities and
Exchange Commission recently adopted a rule that expands the
definition of covered securities under provisions of the federal
Securities Act of 1933. The expanded definition includes securi-
ties listed, or authorized for listing, on the Nasdaq Capital Market
as covered securities. The change became effective May 24,
2007. Pursuant to provisions of current federal law, covered
securities are exempt from state registration requirements. For
more information, visit www.sec.gov/rules/final/2007/33-8791.pdf. Applicants seeking a waiver for IAR exam requirements
must apply in writing on the prescribed form to the
Securities Department, possess at least 10 years of work
experience in the securities field, and have passed the
Series 7 exam at the time of the waiver application. 2008 Filing Deadlines December 1, 2007
Business Brokers and Loan Brokers Renewal forms
for calendar year 2008 registration due. (Renewal
forms mailed first week of October.) December 31, 2007
Broker/Dealers Designated Principal filing state-
ments due. (Renewal forms mailed third week of
October.) Registered Investment Advisers Designated Principal
filing statements and Reports of Branch Offices due.
(Renewal forms mailed third week of October.) IAR registration requirements (cont. from page 2) Illinois Securities Department 800-628-7937 888-231-1175 (Spanish line)