A California-based attorney allegedly gave SEC examiners altered altered private placement memoranda (PPMs), passing them as the ones used in the offer and sale of securities issued by NewPoint Financial Services.  The SEC’s Office of the General Counsel alleges that David Tammanor engaged in this improper professional conduct during an SEC examination of his client NewPoint Securities LLC in April and May 2009. 

The original PPMs purportedly provided to investors stated that the funds raised in the offerings would be used primarily for real estate related investments. In fact, the vast majority of money raised in the offerings was misappropriated by NewPoint’s principal John Farahi.

It's alleged that Tamman, a partner at a large international law firm, added language to the PPMs to make it appear that it was disclosed to investors that much of the money raised by NewPoint would be loaned to Farahi.  These amended PPMs were then produced to the SEC’s examination and enforcement staff.  

An administrative hearing will be scheduled. 

    SEC Staff Credits:  Investigation by Brent Smyth, Finola . Manvelian (LA Regional Office).  Litigation will be led by Donna McCaffrey, Christopher Bruckmann (GC Office).   [SEC PR 11-29, 1/28]