SEC Sues Hedge Fund Over "Naked" Shorting

Law360, New York (December 12, 2006, 12:00 AM EST) -- A Texas hedge-fund manager was sued by the Securities and Exchange Commission on Tuesday on charges he made more than $6.5 million on illegal “naked” short selling.

The lawsuit targets Edwin Buchanan Lyon IV, the managing partner and chief investment officer of Dallas-based Gryphon Partners LP, along with Gryphon and six other related firms based in Texas and Bermuda.

Lyon and his companies perpetrated an illegal trading scheme to evade the registration requirements of securities laws in connection with at least thirty-five unregistered securities offerings, known...
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