Cemtrex Inc and Telidyne Inc Controller Charged with Fraud | Goodman & Nekvasil P.A. May Recover Investor Losses
The Securities and Exchange Commission today announced charges against Aron Govil of Jacksonville, Florida, for defrauding investors in two companies he controlled, Cemtrex Inc. and Telidyne Inc.
According to the SEC’s complaint, filed today in U.S. District Court for the Southern District of New York, Govil, the controlling shareholder and executive director of Cemtrex, misappropriated over $7 million of Cemtrex investor funds between April 2016 and January 2018 to finance his personal business ventures and to pay his personal expenses. The complaint also alleges that Govil engaged in scalping – secretly selling Cemtrex stock while paying stock promoters to recommend that retail investors buy the company’s stock – and insider trading. The complaint alleges that Govil did not file with the SEC any of the required disclosures in connection with his Cemtrex trading.
The SEC’s complaint also alleges that Govil, while serving as Telidyne’s chief executive officer, made material misrepresentations to investors regarding the company’s products. According to the complaint, between at least April 2019 and May 2020, Govil falsely told investors that Telidyne, which purports to be a developer of mobile phone applications or “apps,” had developed the “Teli App,” which allowed users to transact in cryptocurrencies from their mobile phones, and also had started work on an app to detect COVID-19. These statements allegedly were false because the Teli App did not have the stated cryptocurrency functionality and Telidyne had not started work on the COVID-19 detection app.
“Govil allegedly flooded the market with paid-for buy recommendations for Cemtrex stock and made false claims about Telidyne’s development of mobile apps that would facilitate cryptocurrency transactions and help combat the coronavirus,” said Richard R. Best, Director of the SEC’s New York Regional Office. “Investors should be wary of online recommendations from unverified sources that appear to capitalize on the latest market trends and seem too good to be true.”
The SEC’s complaint charges Govil with violations of antifraud provisions of the federal securities laws, as well as violations of Section 16(a) of the Securities Exchange Act of 1934, which requires corporate officers, directors, and major shareholders to disclose their transactions in their company’s stock. The action seeks injunctive relief, an officer and director bar, a penny stock bar, disgorgement plus prejudgment interest, and civil penalties. Without admitting or denying the complaint’s allegations, Govil has consented to the entry of a final judgment that enjoins him from violating the charged provisions; imposes officer and director and penny stock bars; imposes, in connection with certain violations, disgorgement in the amount of $626,782, plus prejudgment interest thereon in the amount of $76,693.95; and imposes a civil penalty in the amount of $620,000. The judgment also provides for the court to order, upon motion of the Commission, additional disgorgement with prejudgment interest and/or penalty against Govil, if deemed appropriate. The proposed settlement is subject to court approval.
Investors in Cemtrex Inc. and/or Telidyne Inc. May Recover their Losses with Goodman & Nekvasil, P.A.
If you invested in Cemtrex Inc. and/or Telidyne, Inc., Goodman & Nekvasil, P.A. may help you. Goodman & Nekvasil, P.A., a St. Petersburg, FL law firm with a national practice representing victimized investors, has recovered more than $200 million dollars on behalf of victimized investors.
All our cases are handled on a purely contingency fee basis by Kalju Nekvasil, Esq., formerly regional counsel with the NASD, now known as FINRA. Kalju Nekvasil, Esq. has practiced in this area of the law for more than 35 years.
There is no charge for an evaluation of your case. Further, we handle our cases on a contingency fee basis. This means that unless we recover money for you, we charge no attorney’s fee. Unless you recover any money, you pay us nothing, not even the costs and expenses which the firm will advance on your behalf.
If you incurred investment losses with Cemtrex Inc. and/or Telidyne, Inc. and would like your case evaluated by a securities attorney (again, there is no charge for an evaluation and all cases are handled on a purely contingency fee basis), please contact us.