U.S. SECURITIES AND EXCHANGE COMMISSION
LITIGATION RELEASE NO. 20693 / August 28, 2008
SEC v. ProVision Operation Systems, Inc., Robert T. Fletcher III, Richard C. Hill, James W. Stock, and Lawrence D. Morris, Civil Action No. 8-07-1130(C.D. Cal.)
Former ProVision Operation Systems, Inc. Chief Executive Officer, Robert Fletcher, Ordered to Pay More than $5 Million in Disgorgement and Penalties in Securities Fraud Action
Washington, D.C., August 28, 2008 — On August 14, 2008, Judge Alicemarie H. Stotler of the United States District Court for the Central District of California entered an order permanently enjoining Robert Thomas Fletcher III (Fletcher) from violating the antifraud and registration provisions of the federal securities laws. The order against Fletcher also requires him to disgorge $5,000,000, plus prejudgment interest, and pay a civil money penalty of $130,000.
The SEC’s complaint charges that ProVision and Fletcher fraudulently raised millions of dollars from investors, and then Fletcher used the money for personal expenses and to support his lavish lifestyle, including purchasing jewelry and clothing, and for gambling. The complaint alleges that Fletcher was the chief executive officer, chairman and president of ProVision, a company that purportedly provided continuing education and support to investors through seminars and workshops focusing on real estate investing, stock investing and other wealth-building strategies. The Commission’s complaint also alleges that while raising funds from investors, ProVision and Fletcher fraudulently represented that the company was successful and expanding. They allegedly made materially false or misleading statements about ProVision’s business operations, profitability, and financial condition. According to the complaint, ProVision and Fletcher falsely claimed to own or control, or have the ability to acquire, yachts, real property, and millions of tons of a mineral substance called “humate,” which they fraudulently claimed was worth $137,000,000.
On August 14, 2008, Judge Stotler also entered an order permanently enjoining ProVision Operations Systems, Inc. (ProVision) from violating the antifraud and registration provisions of the federal securities laws.
The orders permenantly enjoin Fletcher and ProVision from violating Section10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, and Sections 17(a), 5(a), and 5(c) of the Securities Act of 1933. ProVision agreed that, upon motion of the Commission, the Court will determine whether it is appropriate to order disgorgement and a civil penalty. Fletcher and ProVision consented to the entry of the orders without admitting or denying the allegations in the complaint. The SEC’s action against remaining defendants James Stock and Lawrence Morris is also ongoing.
For Additional information, see Litigation Release No. 20301 (September 27, 2007) [SEC v. ProVision Operation Systems, Inc., Robert T. Fletcher III, Richard C. Hill, James W. Stock, and Lawrence D. Morris, Civil Action No. 8-07-1130(C.D. Cal.)]
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