SEC - The United States Securities and Exchange Commission
11/25/2024 | Press release | Distributed by Public on 11/25/2024 22:25
Litigation Releases (Brad Hare; Mammoth West Corporation)
U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 26181 / November 25, 2024
Securities and Exchange Commission v. Brad Hare, Mammoth West Corporation
, No. 1:24-cv-12134 (N.D. Ill. filed Nov. 25, 2024)
SEC Charges Convertible Note Dealer and Its Owner for Failure to Register
The Securities and Exchange Commission (the "SEC") today announced settled charges against a convertible note dealer, Illinois-based Mammoth West Corporation (dba "Mammoth Corporation") and its president and owner Brad Hare, a resident of Illinois, for failing to register with the SEC as securities dealers. As part of the settlement, Hare and Mammoth Corporation agreed to pay more than $3.9 million in monetary relief and have Mammoth Corporation surrender for cancellation the securities it allegedly obtained from its unregistered dealer activity.The SEC's complaint, filed in the U.S. District Court for the Northern District of Illinois, alleges that Mammoth Corporation was a well-known lender to microcap issuers, advertising its willingness to buy convertible notes of microcap issuers as part of its regular business. Between April 2018 and early-2024, Mammoth Corporation through Hare, bought at least 47 convertible notes, submitted nearly 100 conversion notices, and converted the notes of 19 different microcap issuers into over 11 billion newly issued shares of stock at a large discount from the market price. Mammoth Corporation and Hare then allegedly sold those newly issued shares into the market, generating over $2.5 million in profits. As alleged, neither Mammoth Corporation nor Hare was registered as a dealer with the SEC or associated with a registered dealer, as their activities required.
Without admitting or denying the allegations, Mammoth Corporation and Hare agreed to the entry of final judgments: (i) enjoining them from violating Section 15(a)(1) of the Securities Exchange Act of 1934; (ii) ordering payment of $2,734,810 in disgorgement and $409,825 in prejudgment interest against Mammoth Corporation and $438,932 in disgorgement and $70,006 in prejudgment interest against Hare; (iii) ordering payment of a civil penalty of $276,700 by Mammoth Corporation and $43,890 by Hare; (iv) ordering Mammoth Corporation to surrender for cancellation all remaining shares and warrants obtained through conversion of notes, as well as conversion rights under any remaining convertible notes; and (v) imposing five-year penny stock bars. The settlement is subject to court approval.
The SEC's investigation was conducted by Andrew Elliott and supervised by Amy L. Friedman and Mark Cave. The litigation will be led by P. Davis Oliver and supervised by James Carlson.