A federal court in New York recently entered final judgments against Anthony Killarney and the entities Blacklight SA, Tamarind Investments Inc., and SSID Ltd. for their roles in a scheme that generated more than $35 million of illegal sales of stock in at least 45 microcap companies. Among other things, the court imposed an injunction and penny stock bar on Killarney, and ordered the three entities to pay a combined total of over $14 million in monetary relief.
As alleged in the SEC’s complaint, filed in January 2020, Killarney, a U.K. citizen, together with Kenneth Ciapala, a citizen of the U.K. and Switzerland, controlled the Swiss-based company Blacklight. According to the complaint, Killarney and Ciapala used Blacklight to help undisclosed public company insiders or control persons secretly dump large quantities of microcap stock. Killarney and Ciapala, as alleged, coordinated the illegal stock sales with Steve M. Bajic, a citizen of Canada and Croatia, and Rajesh Taneja, a Canadian citizen. The complaint further alleged that Bajic and Taneja used a network of foreign companies they controlled, including Tamarind and SSID, to buy and sell stock in order to conceal the ownership interest of numerous companies’ control persons.
On February 1, 2021, the court entered a final judgment against Killarney, enjoining him from future violations of the securities registration provisions of Sections 5(a) and (c) of the Securities Act, the antifraud provisions of Sections 17(a)(1) and (3) of the Securities Act and Section 10(b) of the Exchange Act and Rules 10b-5(a) and (c) thereunder, and the reporting provisions of Section 13(d) of the Exchange Act, and from acting as an unregistered broker or dealer under Section 15(a) of the Exchange Act. The judgment imposes a penny stock bar and orders disgorgement of ill-gotten gains and/or penalties for Killarney in an amount to be determined at a later date by the court. On February 23, 2021, the court entered final judgments by default against Blacklight, Tamarind, and SSID and, among other relief, ordered each to pay disgorgement and prejudgment interest that combined totaled more than $13.5 million. The court also ordered Blacklight to pay a penalty of $963,837.
The ongoing case against Steve Bajic and Kenneth Ciapala is being handled by Kathleen Shields, Eric Forni, Trevor Donelan, and Amy Gwiazda in the SEC’s Boston Regional Office.