SCC COMMISSION ENTERS FINAL JUDGMENT AGAINST DEFENDANT RAYMOND C. DABNEY

COMMISSION ANNOUNCEMENTS

Commission Meetings

Closed Meeting - Thursday, February 18, 2010 - 2:00 p.m.

The subject matter of the Closed Meeting scheduled for Thursday, February 18, will be: institution and settlement of injunctive actions; institution and settlement of administrative proceedings; an adjudicatory matter; amicus consideration; and other matters relating to enforcement proceedings.

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Investor Advisory Committee - Open Meeting - Monday, February 22, 2010 - 9:00 a.m.

The Securities and Exchange Commission Investor Advisory Committee will hold an Open Meeting on Monday, February 22, in the Multipurpose Room, L-006. The meeting will begin at 9:00 a.m. and will be open to the public, with seating on a first-come, first-served basis. Doors will open at 8:30 a.m. Visitors will be subject to security checks.
The agenda for the meeting includes consideration of a Committee recusal policy, a report from the Education Subcommittee, including a presentation on the National Financial Capability Survey, a report from the Investor as Purchaser Subcommittee, including a discussion of fiduciary duty and mandatory arbitration, a report from the Investor as Owner Subcommittee, including recommendations for the Committee on Regulation FD and proxy voting transparency, as well as reports on a work plan for environmental, social, and governance disclosure and on financial reform legislation, and discussion of next steps and closing comments.
At times, changes in Commission priorities require alterations in the scheduling of meeting items. For further information and to ascertain what, if any, matters have been added, deleted or postponed, please contact: The Office of the Secretary at (202) 551-5400.

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ENFORCEMENT PROCEEDINGS

Court Grants Summary Judgment and Enters Final Judgments Against Defendants Raymond C. Dabney, Richard A. Dabney, Charles J. Smith, and Philip M. Young

The Securities and Exchange Commission announced today that the United States District Court for the District of Arizona granted the Commission's motion for summary judgment and entered final judgments, on Feb. 8, 2010, against the four remaining defendants in a civil injunctive action filed by the Commission in August 2008. The final judgments permanently enjoin Raymond C. Dabney of Vancouver, British Columbia, Richard A. Dabney of Rancho Palos Verdes, California, Charles J. Smith of Reno, Nevada, and Philip M. Young of Scottsdale, Arizona, from violations of the securities registration provisions of the federal securities laws, and also enjoin Richard Dabney from violations of the antifraud provisions. The four defendants were ordered to pay more than $1.4 million in disgorgement, interest, and civil penalties. The Commission's complaint alleged that the defendants engaged in an unregistered distribution of the securities of Alliance Transcription Services, Inc. (formerly Strategy X, Inc.) from April 2005 through September 2006 and that Alliance and its officers participated in a scheme to manipulate the price and trading volume of its stock.
The court found that the defendants violated Section 5 of the Securities Act of 1933 (Securities Act) by their direct involvement in the sale of unregistered shares of Alliance stock on at least 15 occasions. In addition, the court found that Richard Dabney, the company's managing director, violated Section 10(b) of the Securities Exchange Act of 1934 (Exchange Act) and Rule 10b-5 thereunder by disseminating press releases containing materially false information about Alliance's purported contracts and revenues.
The final judgment against Richard Dabney permanently enjoins him from violating Section 10(b) of the Exchange Act and Rule 10b-5 thereunder and Section 5 of the Securities Act, orders him to pay disgorgement of $315,940.74 plus prejudgment interest of $87,602.41 and a civil penalty of $130,000, prohibits him for five years 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 or that is required to file reports pursuant to Section 15(d) of the Exchange Act, and bars him for five years from participating in any penny stock offering. The final judgment against Raymond Dabney permanently enjoins him from violating Section 5 of the Securities Act and orders him to pay disgorgement of $109,520.00 plus prejudgment interest of $33,817.10 and a civil penalty of $50,000. The final judgment against Smith permanently enjoins him from violating Section 5 of the Securities Act and orders him to pay disgorgement of $148,797.72 plus prejudgment interest of $38,691.19 and a civil penalty of $50,000. The final judgment against Young permanently enjoins him from violating Section 5 of the Securities Act and orders him to pay disgorgement of $357,276.26 plus prejudgment interest of $87,576.53 and a civil penalty of $50,000.
Final judgments against all of the other defendants in this action were entered previously by the court.
For further information, please see Litigation Release Numbers 19870 (Oct. 16, 2006) [subpoena enforcement action filed]; 20676 (Aug. 8, 2008) [civil injunctive action filed and judgment by consent against William D. O'Neal]; 20791 (Oct. 24, 2008) [judgment by default against Alliance]; 21349 (Dec. 23, 2009) [judgment by consent against Clifford A. Lewis]; and Exchange Act Release Number 56610 (Oct. 4, 2007) [order suspending trading in Alliance securities]. [SEC v. Alliance Transcription Services, Inc., et al., CV-08-01464-PHX-NVW (District of Arizona)] (LR-21413)