MIL-OSI USA: Giguiere et al.

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Source: Securities and Exchange Commission

U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 26024 / June 13, 2024

Securities and Exchange Commission v. Giguiere et al., Civil Action No. 18-cv-1530 (S.D. Cal. filed July 6, 2018; amended Aug. 5, 2022 and Apr. 7, 2023)

SEC Obtains Over $10 Million Judgment in Microcap Fraud Litigation

On June 11, 2024, the United States District Court for the Southern District of California granted the Securities and Exchange Commission’s request for monetary remedies against Gannon Giguiere.

According to the SEC’s complaint filed on July 6, 2018 and amended twice, stock promoter Giguiere engaged in fraudulent schemes involving two separate microcap issuers he controlled on an undisclosed basis. Giguiere allegedly caused the first issuer, a purported technology company focused on the cannabis industry, to improperly issue stock to his nominee entity, and then liquidated that stock while concurrently promoting it, earning several million dollars in illicit proceeds. According to the complaint, Giguiere also used his undisclosed control of the second issuer, a purported medical device company, to profit by conducting a matched trading scheme in the stock with a Cayman Islands-based broker and a third individual who, unbeknownst to Giguiere and the broker, was an FBI cooperating witness. Giguiere allegedly grossed over $1.5 million in proceeds as a result of this second scheme, and was taking steps to continue it, when the SEC suspended trading in the stock. 

The complaint charged Giguiere with violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder and Sections 5(a) and 5(c) of the Securities Act of 1933. Giguiere, without admitting or denying the allegations, consented to a bifurcated settlement, agreeing to be permanently enjoined from violations of the charged provisions and to an officer-and-director bar and a penny stock bar. The Court entered the bifurcated consent judgment on April 17, 2023. The SEC made a motion for $7,760,415.97 in disgorgement and prejudgment interest thereon of $2,091,439.85 and civil penalties of $875,000, which the Court granted on June 11, 2024.

The SEC’s litigation is being led by Christopher J. Dunnigan, Christine D. Ely, and Lindsay S. Moilanen of the SEC’s New York Regional Office and is being supervised by Sheldon L. Pollock and Daniel Loss.

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