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VALLEY ROUNDUP | Woodland Hills

Repayments Ordered in Stock Fraud Case


Three people and two companies were ordered by a federal judge to pay about $1.6 million on charges they used a Woodland Hills boiler room operation to fraudulently pitch stock in a company claiming to make latex gloves, the Securities and Exchange Commission said.

U.S. District Judge Florence-Marie Cooper in Los Angeles ordered Assured International Inc., Sharp Financial Corp., Sam E. Harris, Max Becker and Tralana Lee to return a total of $1.3 million to investors, the SEC said.

Harris, Becker and Lee also were ordered to pay another $300,000 in civil penalties, the SEC said.

A lawyer for all five couldn't be reached for comment.

Assured International, Harris, Becker and Lee operated a boiler room out of Woodland Hills and raised $1.1 million from investors nationwide between February 1998 and January 1999, the SEC charged.

Investors were told Assured would make and distribute disposable latex gloves; that the company would go public in the first quarter of 1999; and that the stock probably would then be worth $5 to $8 per share, the SEC said.

Instead, Assured has manufactured no latex products and almost a quarter of the money went straight to Harris, the SEC said.

The three individuals misappropriated $321,110 for their own use, the SEC alleged.

From February 1999 to June 1999, Lee and Sharp violated the restraining orders by selling an additional $136,500 in Assured stock to investors, the SEC said.

The agency says Harris had had orders issued against him by securities officials in California, Missouri, Kansas, Montana, Texas, Oregon and Pennsylvania and had been barred from the securities industry by the National Assn. of Securities Dealers.

The court also permanently barred, or enjoined, the firms and individuals from committing future violations of the anti-fraud provisions of the federal securities laws.

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