SEC Charges New York Firm Over Misleading Barnes & Noble Offer

(RTTNews) - The U.S. Securities and Exchange Commission charged Michael A. Glickstein and his New York-based investment advisory firm with fraud based on a misleading press release announcing their offer to purchase a majority stake in retail bookseller Barnes & Noble (BKS).

According to the SEC's order instituting a settled administrative proceeding, Glickstein and G Asset Management LLC issued a press release on February 21, 2014 announcing that G Asset had offered to purchase a majority interest in Barnes & Noble for $22 per share. In a matter of seconds after the announcement, Barnes & Noble's stock price rose from $17.05 per share to $18.99 per share, causing the New York Stock Exchange to temporarily halt trading in the stock.

The SEC's order found that G Asset's press release was misleading because it did not disclose material facts, including: G Asset had no ability to finance its purported offer to purchase Barnes & Noble and no reasonable basis to believe it could finance its offer in the future; G Asset had recently purchased thousands of Barnes & Noble shares and short-term call options, intending to profit by selling the shares and options after issuing the press release.

The SEC's order further found that G Asset's investment funds made about $168,000 in profits as a result of their sale of Barnes & Noble stock and options.

G Asset and Glickstein, G Asset's owner, president, and chief investment officer, agreed to settle charges that they violated the antifraud provisions of the securities laws and a related SEC antifraud rule.

Without admitting or denying the findings in the order, Glickstein and his firm consented to a settlement that requires them to return $175,000 of allegedly ill-gotten gains and interest. G Asset also agreed to be censured and Glickstein agreed to pay a civil penalty of $100,000 and be barred from the securities industry for a minimum of five years.