This case was last updated from PACER on 09/11/2021 at 07:58:56 (UTC).

Securities and Exchange Commission v. ProSky, Inc. et al

Case Summary

On September 10, 2021, Securities and Exchange Commission (the “Commission”), represented by David Misler, attorney at SEC’s DC Regional Office, and Stephen James Binhak of Law Office of Stephen James Binhak, PLLC, filed a civil enforcement action against ProSky, Inc. (“ProSky” or “Company”), Crystal A. Huang (“Huang” and with ProSky, “Defendants”) and T and C Partnership, LLC ( “Relief Defendant”). The Commission filed suit seeking injunctive relief, disgorgement of all illicit gains with pre-judgment interest, and civil penalties for allegedly making materially false and misleading misrepresentations about the Company’s financial condition and its customer base to induce investments from investors and then misappropriating the money. This case was filed in the U.S. District Court in the Southern District of New York.

 

In its complaint, the Commission alleged that, “Between at least February 2015 and February 2020, Defendant ProSky and its co-founder and Chief Executive Officer, Huang, made materially false and misleading misrepresentations about the Company’s financial condition and its customer base to induce investments from at least sixteen prospective and pre-existing investors and then misappropriated some investor money. Defendants provided investors, many of whom focused on investing in minority- and women-owned businesses such as ProSky, with falsified bank statements and balance sheets that overstated ProSky’s cash reserves and revenues by millions of dollars. Defendants also provided investors with falsified customer lists that contained companies which were not actual ProSky customers and which were used to support inflated revenue figures. Thirteen of these investors ultimately invested $5.025 million in ProSky based on Defendants’ material misrepresentations.”

 

The Commission further alleged that, “ProSky and Huang diverted hundreds of thousands of dollars in investor money to Huang and her family members for their personal benefit. This included transferring at least $371,000 to the Relief Defendant—T and C Partnership, LLC—a private company controlled by Huang and her husband, which then purportedly loaned $235,000 of that money to Huang and her husband to purchase a residential property.” 

 

The Commission lists out six claims for relief. The first claim is for the violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. The second claim is for the violations of Section 17(a) of the Securities Act. The third claim is against Huang for Control Person Liability under Exchange Act Section 20(a) for violations of Exchange Act Section 10(b) and Rule 10b-5 thereunder. The fourth and fifth claims are also against Huang for aiding and abetting violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder and Section 17(a) of the Securities Act. The sixth claim is against the Relief Defendant for unjust enrichment liability.

 

In its prayer for relief, the Commission requested the court to permanently restrain and enjoin Defendants from, directly or indirectly, violating the Securities and Exchange Act. The Commissions further requested the court order all Defendants to disgorge all illicit gains, with prejudgment interest and order Defendant Huang to pay appropriate civil penalties and permanently enjoin from directly or indirectly, participating in the issuance, purchase, offer, or sale of any security except for her own personal account. Further, the Commission requested the court permanently bar Defendant Huang from acting as an officer or director of any issuer that has a class of securities registered pursuant to Section 12 of the Exchange Act, and grant such other and further relief as the court may deem just and appropriate for the protection of investors.

 

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Case Details Parties Documents Dockets

 

Case Details

  • Case Number:

    1:21-CV-07568

  • Filing Date:

    09/10/2021

  • Case Status:

    Pending - Other Pending

  • Case Type:

    Finance - Security/Commodity/Exchange

 

Party Details

Plaintiff

Securities and Exchange Commission

Defendants

ProSky, Inc.

Crystal A. Huang

T and C Partnership, LLC

Attorney/Law Firm Details

Plaintiff Attorney

David Misler

Attorney at Securities and Exchange Commission (DC)

100 F Street, N.E.

Washington, DC 20549

Defendant Attorney

Stephen James Binhak

Attorney at Law Office of Stephen James Binhak, PLLC

1 Se 3Rd Avenue, Suite 2600

Miami, FL 33131

 

Court Documents

#4

(#4) NOTICE OF APPEARANCE by Stephen James Binhak on behalf of ProSky, Inc...(Binhak, Stephen) (Entered: 09/10/2021)

3 #4

Exhibit Certificate of Good Standing (MD)

3 #3

Exhibit Certificate of Good Standing (DC)

3 #2

Text of Proposed Order

3 #1

Affidavit

3 #3

Main Document

#2

(#2) CIVIL COVER SHEET filed..(Misler, David) (Entered: 09/10/2021)

#1

(#1) COMPLAINT against Crystal A. Huang, ProSky, Inc., T and C Partnership, LLC. Document filed by Securities and Exchange Commission..(Misler, David) (Entered: 09/10/2021)

 

Docket Entries

  • 09/10/2021
  • View Court Documents
  • Docket(#4) NOTICE OF APPEARANCE by Stephen James Binhak on behalf of ProSky, Inc...(Binhak, Stephen) (Entered: 09/10/2021)

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  • 09/10/2021
  • View Court Documents
  • Docket(#3) MOTION for David Misler to Appear Pro Hac Vice . Motion and supporting papers to be reviewed by Clerk's Office staff. Document filed by Securities and Exchange Commission. (Attachments: #1 Affidavit, #2 Text of Proposed Order, #3 Exhibit Certificate of Good Standing (DC), #4 Exhibit Certificate of Good Standing (MD)).(Misler, David) (Entered: 09/10/2021)

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  • 09/10/2021
  • View Court Documents
  • Docket(#2) CIVIL COVER SHEET filed..(Misler, David) (Entered: 09/10/2021)

    Read MoreRead Less
  • 09/10/2021
  • View Court Documents
  • Docket(#1) COMPLAINT against Crystal A. Huang, ProSky, Inc., T and C Partnership, LLC. Document filed by Securities and Exchange Commission..(Misler, David) (Entered: 09/10/2021)

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