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Adamson Brothers’ Andy Altahawi Responds to Recent SEC Case


Longfin consultant Andy Altahawi is speaking out on the recent SEC case, Case No. 1:18-cv-02977 (SDNY)(DLC) & Securities Exchange Act of 1934 Release No. 86075/June 10, 2019.

Adamson Brothers’ Andy Altahawi Responds to Recent SEC Case
Miami, FL, July 23, 2019 --(PR.com)-- Mr. Altahawi recently agreed to settle his case with the SEC and has stated the following, “I have great respect for the Securities and Exchange Commission’s mission of protecting investors, maintaining fair, orderly, and efficient markets, and facilitating capital formation. I have enjoyed and still enjoy a great relationship with the agency as a consultant/filer, where I help my clients to qualify their offering under Regulation A+ and under other regulations.”

The SEC’s Second Amended Complaint alleged the following:, “On December 11, 2017, Altahawi falsely reported to NASDAQ that Longfin had sold a total of 1,140,989 shares at $5 per share in the offering. Altahawi represented that (i) Longfin had sold 1,140,989 shares in the Regulation A offering at $5 per share; (ii) the total number of shares outstanding after closing was 44,040,898; and (iii) there were 364 shareholders in total, each holding at least 100 shares. Altahawi also sent NASDAQ a final list of shareholders, their addresses, and the quantity of shares each held in book entry. Altahawi knew or recklessly disregarded that the December 6 Shareholders were company insiders or Meenavalli affiliates who were provided shares in order for Longfin to improperly meet NASDAQ listing requirements.”

The SEC also alleged that, "On September 15, 2017, Longfin issued 2,025,000 Class A common shares to Altahawi in consideration of legal and business consulting services he had performed for the company (the 'Consulting Shares'). The Consulting Shares were restricted securities that could not be resold, except under limited circumstances."

Mr. Altahawi alleged, “After a lapse of one year since February 1st, 2017, I did seek a legal opinion to lift the restricted legend on my shares in reliance on the Rule 144 exemption (One year holding period). I obtained the legal opinion from a securities lawyer, and I sold some of my consultancy shares. The intent of the agreement was that the two million shares were to be issued on February 1st, 2017 because of the advisory work that was rendered since 2015. To be clear, the equity component was compensation for work already done by me as a consultant to Longfin subsidiary since 2015.”

The SEC alleged, “Between January 31, 2018 and March 6, 2018, Altahawi acquired 121,000 additional restricted shares of Longfin from ten of the December 6 Shareholders (the ‘Private Transaction Shares’). Altahawi’s agreements with the ten shareholders were memorialized in a single stock purchase agreement, dated January 12, 2018, even though the ten individuals from whom Altahawi purchased were located in multiple locations. Altahawi agreed to purchase the 121,000 shares at a price of $30 per share, well below the market price for Longfin shares on January 12.”

Mr. Altahawi alleged, “I acquired additional shares from several private parties who desired to sell their shares, and due to their country’s restrictions, they couldn’t open a US based brokerage account. Those shares were acquired by those investors during the direct public offering as far as I know, the company was allowed by its June 16th, 2017 SEC Regulation 'A' qualification to sell shares directly to its investors and receive the funds directly to the company account, which explained in detail in my April 17th, 2018 court declaration.”

Mr. Altahawi finally stated that, “I will continue to work as a consultant to help young companies go public, and I will be very careful not to violate my settlement agreement with the SEC or any rules or regulations, and according to my proposed settlement agreement with the SEC, I do not admit nor deny the alleged violations.”
Contact Information
Adamson Brothers
Andy Altahawi
+1-201-281-2211
Contact
www.adamsonbrothers.com

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