This case was last updated from PACER on 05/31/2021 at 07:31:45 (UTC).

Securities and Exchange Commission v. Randolph

Case Summary

On April 1, 2021, the Securities and Exchange Commission (the “Commission”), represented by Madison Graham Loomis and W. Shawn Murnahan, attorneys at the SEC filed a civil enforcement action against Richard J. Randolph, III (“Randolph”) seeking injunctive relief, disgorgement of all ill-gotten gains among other reliefs for violating the antifraud provisions of the federal securities laws. This case was filed in the U.S. District Court for the District of Texas with Judge D. Grimberg presiding. 

 

In its complaint, the Commission alleged that “Randolph misappropriated a substantial amount of investor proceeds, including making over $400,000 in cash withdrawals for unauthorized purposes. Randolph also routinely used investments in one business to fund the activities of other Randolph-controlled businesses in which investors had no interest.” “The primary vehicle for Randolph’s fraud was Randolph Acquisitions, Inc. (“RAI”) through which he made fraudulent misrepresentations and omissions, including touting RAI’s upcoming merger with Gallagher Management Group, LLC (“Gallagher Management”)”. “Randolph misled prospective RAI investors with a variety of false information regarding Gallagher Management, including fraudulent audited financial statements and a valuation report that grossly overstated the value of Gallagher Management’s assets. Randolph also directed prospective investors to RAI’s SEC-filings to lend an additional air of legitimacy to his businesses.”

 

The Commission further alleged that “Randolph also represented to investors that RAI was close to securing a variety of large public and private contracts in the U.S. Virgin Islands, including hurricane remediation contracts and an agreement to manage the U.S. Virgin Islands public retirement fund.” “As a result of the conduct alleged in this Complaint, Randolph violated Section 17(a) of the Securities Act of 1933 (“Securities Act”), 15 U.S.C. § 77q(a) and Section 10(b) and Rule 10b-5 of the Securities Exchange Act of 1934 (“Exchange Act”), 15 U.S.C. § 78j(b) and 17 C.F.R. § 240.10b-5. Unless restrained and enjoined, Randolph is reasonably likely to continue to violate the federal securities laws.”

 

There are six claims for relief laid down by the Commission. The first claim is for the alleged violation of Section 17(a)(1) of the Securities Act. The second claim for relief is for the alleged violation of Fraud in Violation of Section 17(a)(2) of the Securities Act. The third claim for relief is for alleged fraud in Violation of Section 17(a)(3) of the Securities Act. The fourth claim for relief is for alleged fraud in Violation of Section 10(b) and Rule 10b-5(a) of the Exchange Act. The fifth claim for relief is for alleged fraud in Violation of Section 10(b) and Rule 10b-5(b) of the Exchange Act. The sixth claim for relief is for alleged fraud in Violation of Section 10(b) and Rule 10b-5(c) of the Exchange Act. 

In its prayer for relief, the SEC has requested the court to permanently restrain and enjoin Randolph from directly or indirectly, or through associated persons in active concert or participation with them, and each of them, from directly or indirectly violating the laws alleged in the complaint, to order disgorgement of ill-gotten gains derived, and to order Randolph with prejudgment interest along with payment of civil penalties. The Court may order any other relief as it may deem fit. 

 

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Case Details Parties Documents Dockets

 

Case Details

  • Case Number:

    1:21-CV-01321

  • Filing Date:

    04/01/2021

  • Case Status:

    Pending - Other Pending

  • Case Type:

    Finance - Security/Commodity/Exchange

Judge Details

Presiding Judge

Steven D. Grimberg

 

Party Details

Plaintiff

Securities and Exchange Commission

Defendant

Richard J. Randolph, III

Attorney/Law Firm Details

Plaintiff Attorneys

Madison Graham Loomis

Attorney at U.S. Securities & Exchange Commission-GA

Suite 900, 950 East Paces Ferry Rd., N.E.

Atlanta, GA 30326-1382

W. Shawn Murnahan

Attorney at Securities and Exchange Commission

Suite 900, 950 East Paces Ferry Road, N.E.

Atlanta, GA 30326

Defendant Attorneys

Nicole Waid

Attorney at FisherBroyles, LLP

Suite 203, 625 Tamiani Trail North

Naples, FL 34102

Joel Michael Ferdinand

Attorney at FisherBroyles, LLP - Atl

Suite 2000, 945 East Paces Ferry Rd., N.E.

Atlanta, GA 30326

 

Court Documents

1 #1

Civil Cover Sheet

1 #2

-Correct PDF -Main Document -Complaint -

#2

#3

#4

#5

5 #1

Exhibit A - Consent by Def to Entry of Judgment

5 #2

Exhibit B - Proposed Consent Judgment

#6

RESTRICTED

 

Docket Entries

  • 05/27/2021
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  • DocketORDER granting #6 Application for Admission Pro Hac Vice of Nicole Waid. Approved by Judge Steven D. Grimberg on May 27, 2021. If the applicant does not have CM/ECF access in the Northern District of Georgia already, they must request access at http://pacer.gov. If they have electronically filed in this district in a previous case, please omit this step.(ash) (Entered: 05/27/2021)

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  • 05/26/2021
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  • DocketAPPROVAL by Clerks Office re: #6 APPLICATION for Admission of Nicole Waid Pro Hac Vice (Application fee $ 150, receipt number AGANDC-10988509).. Attorney Nicole Waid added appearing on behalf of Richard J. Randolph, III (nmb) (Entered: 05/26/2021)

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  • 05/20/2021
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  • Docket(#6) APPLICATION for Admission of Nicole Waid Pro Hac Vice (Application fee $ 150, receipt number AGANDC-10988509).by Richard J. Randolph, III. (Ferdinand, Joel) Documents for this entry are not available for viewing outside the courthouse. (Entered: 05/20/2021)

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  • 05/17/2021
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  • DocketSubmission of the #5 MOTION to Approve Consent Judgment to District Judge Steven D. Grimberg. (aaq) (Entered: 05/17/2021)

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  • 04/28/2021
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  • Docket(#5) MOTION to Approve Consent Judgment by Securities and Exchange Commission. (Attachments: #1 Exhibit A - Consent by Def to Entry of Judgment, #2 Exhibit B - Proposed Consent Judgment)(Murnahan, W.) (Entered: 04/28/2021)

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  • 04/21/2021
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  • Docket(#4) NOTICE of Appearance by Joel Michael Ferdinand on behalf of Richard J. Randolph, III (Ferdinand, Joel) (Entered: 04/21/2021)

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  • 04/02/2021
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  • Docket(#3) STANDING ORDER Regarding Civil Litigation. Ordered by Judge Steven D. Grimberg on April 2, 2021. (ash) (Entered: 04/02/2021)

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  • 04/01/2021
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  • DocketNotification of Docket Correction re #1 Complaint. Modified to attach the correct Complaint PDF. (eop) (Entered: 04/01/2021)

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  • 04/01/2021
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  • Docket(#2) ELEVENTH AMENDMENT TO GENERAL ORDER 20-01 RE: COURT OPERATIONS UNDER THE EXIGENT CIRCUMSTANCES CREATED BY COVID-19 AND RELATED CORONA VIRUS. Signed by Judge Thomas W. Thrash, Jr. on 3/9/2021. (eop) (Entered: 04/01/2021)

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  • 04/01/2021
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  • Docket(#1) COMPLAINT with Jury Demand filed by Securities and Exchange Commission. (Attachments: #1 Civil Cover Sheet)(eop) Please visit our website at http://www.gand.uscourts.gov/commonly-used-forms to obtain Pretrial Instructions and Pretrial Associated Forms which includes the Consent To Proceed Before U.S. Magistrate form. (Additional attachment(s) added on 4/1/2021: #2 -Correct PDF -Main Document -Complaint -) (eop). (Entered: 04/01/2021)

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