SEC v. Manhattan Transfer Registrar Company and John C. Ahearn (reverse merger schemes, 2018)

Settled

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In May 2018 the SEC settled with transfer agent Manhattan Transfer Registrar and its principal John Ahearn for removing restrictive legends and moving shares of two blank-check shells that undisclosed control persons then sold publicly without registration. The firm owes $2,132.57 disgorgement, $361.96 interest and a $50,000 penalty; Ahearn is barred with a five-year right to reapply.

The record

What was ordered

Civil penalty

$50k

Disgorgement

$2.1k

Prejudgment interest

$362

Total relief

$52.5k

Alleged gain

—

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

The Securities and Exchange Commission instituted and settled this proceeding on May 17, 2018 (Securities Act release 10497), without admission or denial by the respondents.

The order describes three undisclosed control persons who manufactured at least 22 blank-check companies from 2007 to 2013, sold 18 of them for about $6 million, and aimed to sell the whole float of purportedly unrestricted shares by reverse merger. It finds that Manhattan Transfer, at Ahearn's direction, removed restrictive legends from and transferred stock certificates of two of the shells, InTake Communications and Entertainment Art, so restricted shares were sold publicly with no effective registration, willfully violating Sections 5(a) and 5(c).

This library tags the matter as reverse merger schemes and undisclosed control blocks. The tagging is ours, not the regulator's.

Both respondents were ordered to cease and desist and Manhattan Transfer was censured and ordered to pay $2,132.57 in disgorgement, $361.96 in interest and a $50,000 penalty. Ahearn was barred from association with a broker, dealer, adviser, transfer agent or rating organization with a right to reapply after five years. The record had joined the two names into one entity and omitted the interest.

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.

What technique is this, and how does it work?

This action is tagged with 2 techniques 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.

• Reverse merger schemes — see how it works, what statute it engages, and every other action tagged the same way.
• Undisclosed control blocks — see how it works, what statute it engages, and every other action tagged the same way.

Timeline

1. 2018-05-17 Administrative proceeding instituted (cease-and-desist)

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 order

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.

Related actions

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

Record added September 10, 2026. submit a correction.