SEC v. Caledonian Bank Ltd., et al. (unregistered distributions, 2015)

Judgment entered

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In February 2015 the SEC charged five offshore entities with selling unregistered penny stocks into U.S. markets for over $75 million, and obtained an asset freeze. Judgments followed from November 2016 to July 2017: a settlement with the two Caledonian entities and default judgments against the other three, all with Section 5 injunctions and penny stock bars.

The record

What was ordered

Civil penalty

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Disgorgement

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Prejudgment interest

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Total relief

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Alleged gain

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A dash means the release did not state a figure we could extract, not that the figure is zero. Penalty and disgorgement are stored separately so aggregates across the library do not double-count the same dollars.

What is alleged to have happened

On February 11, 2015 the SEC announced a complaint filed February 6 in the Southern District of New York against Caledonian Bank Ltd., Caledonian Securities Ltd., Clear Water Securities, Inc., Legacy Global Markets S.A. and Verdmont Capital S.A. It alleges they sold penny stock of four shell issuers in unregistered distributions from U.S. brokerage accounts, reaping over $75 million, and the court froze their U.S. assets. These were allegations when filed. The record previously showed the defendants as 'Caledonian Bank Ltd., et al.'.

This library tags the matter as unregistered distributions, based on the conduct the document describes. The tagging is ours, not the regulator's: agencies charge statutory provisions, not technique names.

For the regulator's own account of the facts, read the primary document linked above. This page deliberately summarises the structured record rather than reproducing the release.

Outcome. SEC litigation release 23921 (August 25, 2017) reports that on November 9, 2016 Judge William Pauley entered a settled final judgment against Caledonian Bank Ltd. and Caledonian Securities Ltd., on April 7, 2017 a default judgment against Verdmont Capital S.A., and on July 31, 2017 default judgments against Clear Water Securities, Inc. and Legacy Global Markets S.A. All five received permanent Section 5 injunctions and penny stock bars. The Caledonian entities were found jointly and severally liable for $25 million, but payment was waived because of liquidation proceedings in the U.S. and Cayman Islands. Verdmont was ordered to pay $19.2 million in disgorgement and prejudgment interest and a $19.2 million penalty. Clear Water and Legacy Global were ordered to pay disgorgement, interest and penalties of over $17.3 million and $14.9 million. Because the release does not split several of these amounts between disgorgement, interest and penalty, and one was waived, no money fields are stored. The resolved date is the last judgment.

What technique is this, and how does it work?

This action is tagged with one technique in our taxonomy. The tagging is ours: regulators charge statutory provisions, not technique names, so the mapping is an editorial judgement described in our editorial policy.

• Unregistered distributions — see how it works, what statute it engages, and every other action tagged the same way.

Timeline

1. 2015-02-11 Litigation release published
2. 2017-07-31 Last of five final judgments entered (S.D.N.Y.)

Primary documents

Everything on this page derives from the documents below. Where our summary and the primary document disagree, the primary document is right.

• SEC litigation release
• SEC litigation release 23921 (final judgments)

The linked release is a work of the United States government and is not subject to copyright. Our summary and narrative above are our own writing.

Same matter

The library links these 2 records because they appear to concern one matter: the same lead defendant, an overlapping technique tag and close filing dates, or a shared court docket or a release that cites the other. Records are listed by date filed.

This grouping is the library's, made by matching names, techniques, dates and citations when the site is built. It is not the regulator's or a court's determination that the records are one case, and it errs towards missing a link rather than making a false one.

Related actions

Other actions in the library sharing at least one technique tag with this one.

Record added September 10, 2026. submit a correction.