Money Awards to SEC Over Pump-and-Dump Scheme Upheld on Appeal

Five disgorgement awards to the SEC totaling nearly $43 million in a penny-stock market manipulation case were proper, the First Circuit ruled Thursday.

The scheme’s internal records support each individual defendant’s share of responsibility, the US Court of Appeals for the First Circuit said. The case will go back to the US District Court for the District of Massachusetts to clarify an injunction against one defendant.

Zhiying Yvonne Gasarch and four other defendants in the civil enforcement case challenged an order of the US District Court for the District of Massachusetts that they disgorge ill-gotten gains to the Securities and ...