U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 25957/ March 27, 2024
Securities and Exchange Commission v. Jonathan William Mikula, et al., No. 2:22-cv-07096, (C.D. Cal. filed Sept. 30, 2022)
SEC Obtains Final Judgment Against Christian Fernandez in Scheme to Fraudulently Promote Securities Offerings
On February 20, 2024, the Securities and Exchange Commission (“SEC”) obtained a final judgment against Christian Fernandez, who the SEC previously charged for his involvement in a fraudulent scheme to promote the securities of issuers that were conducting (or purporting to conduct) offerings pursuant to Regulation A, which, if certain conditions are met, provides an exemption to the Securities Act's registration provisions.
The SEC’s complaint was filed on September 30, 2022, in federal court in the U.S. District Court in Los Angeles, California. The SEC’s complaint alleged that Fernandez acted as a middleman for the promotional scheme. According to the complaint, Fernandez arranged to receive a percentage of investor funds raised by the issuers, in exchange for arranging the promotions under the guise of consulting agreements with the issuers. The complaint also alleged that Fernandez tried to disguise his receipt of payments from the issuers by submitting invoices for fake consulting services, and by funneling payments through offshore accounts for a co-defendant’s benefit.
Fernandez consented to the entry of a judgment that permanently enjoined Fernandez from: (1) violating the antifraud provisions of Sections 17(a)(1), 17(a)(3), and 17(b) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rules 10b-5(a) and (c)thereunder; and (2) directly or indirectly, including, but not limited to, through any entity he owns or controls, assisting with, facilitating, or receiving compensation in any form for a Promotional Campaign related to any security. Fernandez was also ordered to pay disgorgement of $458,160, representing net profits gained as a result of the conduct alleged in the complaint, together with prejudgment interest thereon in the amount of $41,557.44. Based on Fernandez’s cooperation in a Commission investigation and related enforcement action, Fernandez was not ordered to pay a civil penalty.
The SEC's litigation was led by Charles Canter and supervised by Douglas M. Miller, and the investigation was conducted by Sarah Nilson and Yolanda Ochoa and supervised by Finola Manvelian.