FORT MYERS - The U.S. Securities and Exchange Commission has filed a motion to restrain and enjoin defendants accused of violating federal securities laws.
“Unless restrained and enjoined, defendants are reasonably likely to continue to violate the federal securities laws,” the April 25 motion stated.
Diane J. Harrison, 59; Michael J. Daniels, 71; both of Palmetto; and Catherine A. Bradaick-Zolla, 50, of Sarasota, are accused of violating the antifraud, registration and reporting provision. Harrison, a securities law attorney, allegedly participated in two separate fraud schemes from July 2010 through August 2014. The alleged schemes reportedly involved the manufacturing of public companies “for sale fundamentally premised on a deceptive public float of purportedly ‘free-trading’ securities.”
“The creation of the deceptive public float was dependent on false and misleading statements” regarding the control persons, officers, shareholders and purpose of the companies.
In another incident, Harrison and her husband, Michael Daniels, reportedly acquired a local pizzeria and gifted its privately held securities to 30 family members and friends by providing them with all the money to “purchase” the shares. This allegedly was done to make it appear they had actually invested in the companies.
Bradaick-Zolla was an officer of one of the couple’s companies and allegedly assisted them in creating four companies. Daniels reportedly used 5 Dogs Inc. as a conduit to receive and disburse funds.
Harrison is also accused of participating in a scheme with Alvin S. Mirman, 77, and Sheldon R. Rose, 76, both of Sarasota, that involved at least 11 undisclosed “blank check” companies. She reportedly acted as Mirman and Rose’s primary attorney to further the scheme. The SEC alleged that she prepared at least 21 legal opinion letters regarding “the valid and unrestricted nature of the securities of the Mirman/Rose Companies” at the direction and for the primary benefit of her clients.
“Harrison provided these professional services throughout the process knowing - or being reckless in not knowing - about the fraud and falsity of her statements,” the motion said.
Mirman and Rose subsequently sold nine of the companies.