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NASD SANCTIONS FORMER PRESIDENT AND A REGISTERED REPRESENTATIVE OF AN OKLAHOMA CITY BROKER-DEALER; ALSO EXPELS NEW YORK CITY BROKER-DEALER

NASD SANCTIONS FORMER PRESIDENT AND A REGISTERED REPRESENTATIVE OF AN OKLAHOMA CITY BROKER-DEALER; ALSO EXPELS NEW YORK CITY BROKER-DEALER
 WASHINGTON, Nov. 26 /PRNewswire/ -- The National Association of Securities Dealers, Inc. (NASD), the self-regulatory organization for The Nasdaq Stock Market and the over-the-counter securities markets, has announced two disciplinary actions. The first was taken against Gary E. Bryant, the former president of Anderson, Bryant and Co., a broker-dealer located in Oklahoma City, and Larry J. Phillips, a former registered representative of the firm, for misconduct relating to United Dental Care, Inc., a non-Nasdaq OTC security. Global America, Inc., a broker-dealer located in New York City, was the subject of disciplinary action in a second proceeding.
 Bryant was censured, suspended from association with any NASD member in any capacity for two years, and fined $150,000. Phillips was censured, fined $250,000 and barred from association with any NASD member in any capacity. Bryant has appealed the NASD decision to the Securities and Exchange Commission (SEC). While the matter is being considered by the SEC, the sanctions entered against him are not effective. The sanctions against Phillips are effective immediately.
 The NASD found that Bryant and Phillips engaged in an unregistered distribution of United Dental Care securities. As a result of a merger of UDC with a public shell company, Bryant received 200,000 shares of UDC issued in the name of his daughter; Phillips received 1 million shares; and two nominees with accounts at Anderson, Bryant and Co. received a total of 700,000 shares. None of these shares where registered or exempt from registration, nor did the individuals pay for them. A large number of these shares, as well as other unregistered shares of UDC, were sold into the marketplace without the benefit of a registration statement.
 The NASD found that Bryant's receipt of the unregistered UDC shares represented consideration for his efforts in establishing and supporting an aftermarket in UDC by Anderson, Bryant and Co. to create a means for the nominees to sell their shares and thereafter remit a portion of the proceeds directly to the company. The NASD also found that Bryant and Phillips made misrepresentations and omissions to customers; Bryant failed to disclose his receipt of stock; and Phillips made unwarranted price projections and other misrepresentations about UDC. They also failed to disclose that Phillips and UDC had a control relationship. The NASD further found that Bryant manipulated the price of UDC from 50 cents to $1 over a two-day period, a price that was unrelated to UDC's business history, earnings, assets or production, and was otherwise without justification, and that Bryant engaged in excessive mark-ups, overcharging the firm's customers more than $20,000. Finally, the NASD found that Phillips gave customers written guarantees against loss and that Bryant failed adequately to supervise Phillips. The NASD found that Bryant and Phillips violated, among other provisions, Section 10(b) of the Securities and Exchange Act of 1934 and rule 10b-5 thereunder, and Article III, Section 18, of the NASD's Rules of Fair Practice. These provisions prohibit the use of any manipulative, deceptive or fraudulent device in the purchase or sale of any security.
 In a separate disciplinary action, the NASD Market Surveillance Committee expelled Global America, Inc., a member firm headquartered in New York City, from NASD membership. The decision found that Global failed to cooperate in an investigation by the NASD which was prompted, in part, by numerous customer complaints alleging a refusal of Global to execute sell orders and a precipitous drop in the market price of several securities in which Global made a market after the firm closed in January 1991.
 The NASD investigation in both matters was conducted by its Anti- Fraud Department and initially heard by the NASD's Market Surveillance Committee, which consists of 12 executives of securities firms across the country. The committee's findings as to Bryant and Phillips were affirmed following proceedings on appeal before the National Business Conduct Committee.
 -0- 11/26/91
 /CONTACT: Robert Ferri, 202-728-8955; or William R. Schief, 202-728-8229; or Daniel M. Sibears, 202-728-6911, all of the National Association of Securities Dealers/ CO: National Association of Securities Dealers ST: District of Columbia IN: FIN SU:


MH-DC -- DC027 -- 7448 11/26/91 15:54 EST
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Publication:PR Newswire
Date:Nov 26, 1991
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