Federal regulators say they have won a court order requiring a former principal of a defunct viatical firm to disgorge millions of dollars.[@@]
The U.S. Securities and Exchange Commission says the U.S. District Court in Tampa, Fla., has entered a default judgment requiring the defendant, Robert Kingston Coyne, a former principal at Viatical Capital Inc., Sarasota, Fla., to disgorge more than $5 million, stop violating securities laws and refrain from acting as an officer or director of any issuer of securities subject to Section 12 of the Securities and Exchange Act of 1934.
The order also calls for the court to impose a separate civil penalty “to be determined by the court upon the SEC’s motion,” officials say.
Viatical Capital’s telephone number has been disconnected, and Coyne could not immediately be reached for comment.
Florida regulators and Texas regulators worked with the SEC to investigate Viatical Capital, and the SEC filed a complaint against the firm in 2003.
The SEC charges that Viatical Capital told investors that its affiliated investment partnerships owned viaticated life insurance policies even though many of the policies had been rescinded, terminated or canceled.
Some of the policies that were still in the portfolios were obtained through fraudulent means and therefore were subject to cancellation, the SEC says