SEC v. Sheldon Rose and MKJJ Consulting LLC (reverse merger schemes, 2017)

Settled

Checked against the primary document on October 3, 2026. The library's summary, tags and figures for this record were compared with the regulator's own document by an AI model (Claude) following written instructions, with sampled and disputed records read a second time. No lawyer has reviewed them. A checked record can still contain errors, and checked does not mean endorsed. See how we check records or report a correction.

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In March 2017 the SEC ordered Sheldon Rose and his company MKJJ Consulting to pay $2,734,497 in disgorgement and $239,419.18 in interest for secretly controlling 17 blank-check shells and selling 15 of them as public vehicles, using nominee sole officers and false filings.

The record

Structured fields for this action, as recorded in our case library.
Agency	SEC
Release number	3-17559
Date filed	2017-03-23
Date resolved	2017-03-23
Status	settled
Asset class	equities
Criminal parallel	No
Defendants	Sheldon Rose (individual) ; MKJJ Consulting LLC (entity)
Cited as charged or alleged	Exchange Act s.10(b) and Rule 10b-5 ; Securities Act s.17(a) ; Exchange Act s.32(a) (15 U.S.C. 78ff) (statutes and rules cited in the document; not a finding that they were violated)
Techniques	Reverse merger schemes , Undisclosed control blocks

What was ordered

Civil penalty: —
Disgorgement: $2.7m
Prejudgment interest: $239k
Total relief: $3m
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 issued this order making findings and imposing sanctions on March 23, 2017 (Securities Act release 10325), in a proceeding begun on September 21, 2016 and settled by the respondents' offers.

The order finds that Rose, alone or with other undisclosed control persons, followed a blueprint to create 17 blank-check companies without disclosing their real purpose or control: recruiting sole officers for modest pay, capitalising the companies through them, drafting false corporate records and financial statements, and then selling 15 of the shells, often through reverse mergers or other changes of control, for a share of gross proceeds of $2,734,497. MKJJ was Rose's alter ego, signing consulting agreements and receiving proceeds.

Rose and MKJJ were ordered to pay $2,973,916.18 jointly and severally, made up of that disgorgement and the interest; the obligation is deemed satisfied by a restitution or forfeiture order in the parallel criminal case against Rose in the Southern District of Florida.

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

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

2017-03-23 Administrative proceeding instituted (findings)

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.

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

Action	Agency	Filed	Technique	Penalty	Status
SEC v. Brian Quinn and David Skriloff (Environmental Packaging, 2024)	SEC	2024-10-18	Reverse Merger Schemes , Undisclosed Control Blocks	$461k	judgment
SEC v. Darren Ofsink and Michael T. Morris (CodeSmart, 2023)	SEC	2023-04-03	Reverse Merger Schemes , Undisclosed Control Blocks +1	—	judgment
SEC v. Peter DiChiara (reverse merger schemes, 2020)	SEC	2020-09-03	Reverse Merger Schemes , Undisclosed Control Blocks	$40k	settled
SEC v. Morrie Tobin et al. (undisclosed control blocks, 2019)	SEC	2019-08-30	Undisclosed Control Blocks , Reverse Merger Schemes	—	settled
SEC v. David G. Dreslin, Michael Toups and Leslie Toups (2018)	SEC	2018-12-03	Reverse Merger Schemes , Undisclosed Control Blocks	$345k	settled
SEC v. Delaney Equity Group LLC, David C. Delaney and Ian C. Kass (reverse merger schemes, 2018)	SEC	2018-08-29	Reverse Merger Schemes , Shell Factories +1	—	settled

Record added September 10, 2026. submit a correction.