The allegations read: The securities and exchange commission ("commission") deems it appropriate and in the public interest that public administrative proceedings be, and hereby are, instituted against andrew m. Komarow ("komarow" or "respondent"). In anticipation of the institution of these proceedings, respondent has submitted an offer of settlement (the "offer") which the commission has determined to accept. The commission on december 8, 2023, the commission filed a complaint against komarow entitled sec v. Komarow (civil action no. 3:23-cv-01599) in the united states district court for the district of connecticut. On december 20, 2023, the court entered a judgment by consent against komarow permanently enjoining him from future violations of section 10(b) of the exchange act and rule 10b-5 thereunder. The commission's complaint alleged that, from october 2022 to january 2023, komarow engaged in a "free-riding" securities trading scheme under which he made unfunded automated clearing house ("ach") transfers of money totaling $6.9 million from multiple bank accounts to accounts at broker-dealers and engaged in speculative trading with the resulting credits before the transfers were cancelled for insufficient funds. The commission alleged that, although komarow's trading at each broker-dealer was largely unprofitable, komarow removed funds from two accounts in which he had engaged in free-riding. Komarow's free-riding scheme left the broker-dealers with losses that together totaled more than $3 million.
