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by Mike Caswell

The U.S. Securities and Exchange Commission has won a $6.7-million order against San Diego lawyer Luis Carrillo and others for a boiler room scheme run from Surrey and Calgary. (All figures are in U.S. dollars.) The SEC said that Mr. Carrillo helped a group of Canadians as they illegally sold millions of shares in two pink sheets listings. His actions resulted in gains for others as high as $13.3-million, the SEC claimed.

The penalty for Mr. Carrillo is contained in an order handed down in New York on Tuesday, March 28. It states that Mr. Carrillo and the other partner at his law firm, Wade Huettel, must jointly disgorge $6.7-million in gains. (That disgorgement order also includes Luniel de Beer, a Washington State man who served as president of one of the companies in the scheme.) In addition to the $6.7-million, the men must each pay a $375,000 civil penalty.

For the SEC, the penalty is far from a complete victory. The regulator had originally sought $16.2-million. The SEC said that opinion letters Mr. Carrillo prepared allowed the sale of millions of shares during the scheme. He also helped to design a share structure that concealed vast numbers of shares that others held.

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