1. This case involves two schemes to manipulate the securities markets perpetrated by Avalon, a foreign trading firm. Fayyer (Avalon's disclosed principal) and Pustelnik (an undisclosed control person of Avalon and a former registered representative at LEK) directly participated in and assisted the manipulative schemes. The schemes were made possible through and with the participation and assistance of LEK, a U.S. broker-dealer based in New York, and Sam Lek, LEK's Chief Executive Officer ("CEO"). LEK and Sam Lek provided Avalon with access to the U.S. securities markets to execute the schemes, and otherwise assisted in carrying out the schemes.

2. The first manipulative trading scheme, known as "layering," involved manipulating the markets of U.S. stocks. Under this scheme, Avalon placed "non-bona fide orders"-in other words, orders that Avalon did not intend to execute and that had no legitimate economic reason-to buy or sell stock with the intent of injecting false information into the marketplace about supply or demand for the stock. Avalon did this to trick and induce other market participants to execute against Avalon's bona fide orders (i.e., orders that Avalon did intend to execute) for the same stock on the opposite side of the market. By placing the non-bona fide orders, Avalon was able to manipulate the market for the stocks and thereby obtain more favorable prices on the executions of its bona fide orders than otherwise would have been available. Avalon engaged in hundreds of thousands of instances of layering in numerous securities from approximately December 2010 through at least September 2016, and Avalon made millions of dollars in profits from the scheme.

3. The second manipulative trading scheme is referred to herein as the "cross-market manipulation," "cross-market scheme" or "cross-market strategy." In this scheme, Avalon bought and sold U.S. stock at a loss for the purpose of moving the prices of corresponding options, so that Avalon could make a profit by trading those options at artificial prices that they would not have been able to obtain but for the manipulation. Avalon's stock trades had no legitimate economic reason, and were intended to inject into the market false information about supply and demand in order to move the prices of corresponding options to artificial levels. Although the strategy involved taking a loss on the stock transactions, such losses were far outweighed by Avalon's significant profits from trading the corresponding options whose prices Avalon had manipulated. Avalon engaged in hundreds of instances of cross-market manipulation involving numerous stocks and options from at least August 2012 through at least December 2015, and Avalon made millions of dollars in profits from that scheme.

4. Together, the layering and cross-market manipulation schemes orchestrated by Avalon through LEK generated illicit profits of more than $28 million.

5. Fayyer, as a principal of Avalon, participated in and substantially assisted those schemes, as detailed more fully below.

6. The schemes were made possible through the participation and substantial assistance of LEK and Sam Lek, the majority owner and CEO of LEK, and of Pustelnik, an undisclosed control person of Avalon who also served as a registered representative of LEK for much of the relevant period. LEK, as a registered broker-dealer, provided Avalon with direct access to the U.S. securities markets and, along with Sam Lek as CEO, approved, permitted and facilitated Avalon's schemes even though they knew or were reckless in not knowing that Avalon was engaging in market manipulation.

7. LEK and Sam Lek had ample motive to assist and allow Avalon's manipulative trading. Between 2012 and 2016, Avalon was LEK's highest producing customer in terms of commissions and fees and rebates generated. LEK made significant profits from commissions and other amounts it earned from Avalon's layering and cross-market manipulation.

8. Beginning in late 2010, Pustelnik embedded himself at LEK, first as a foreign finder and then as a registered representative, thus enabling him to facilitate Avalon's manipulative trading through LEK. Pustelnik received a share of Avalon's profits directly from Avalon, including profits from the layering and cross-market manipulation. Moreover, as a registered representative at LEK who handled the Avalon account, Pustelnik received 3 commissions and other payments from the manipulative trading by Avalon, and thereby increased his share of illicit profits beyond what he received as a control person of Avalon.

9. Pustelnik played a central role in ensuring the success of the layering and cross-market schemes. Pustelnik recruited Avalon traders for the purpose of carrying out the schemes and worked closely with LEK to ensure the success and effectiveness of the strategies. When Avalon encountered technical or other difficulties in carrying out the cross-market manipulation through LEK, for example, Pustelnik arranged for the Avalon traders who executed the trading in the cross-market manipulation to conduct the scheme through an investment management firm ("Investment Management Firm") that traded through a different broker-dealer ("Other Broker-Dealer"). When the Other Broker-Dealer observed the manipulative nature of the cross-market scheme and objected to it, Pustelnik arranged to move the scheme back to LEK. Throughout, Pustelnik used his position at LEK to facilitate and further the cross-market scheme.

10. By engaging in the conduct alleged herein, Avalon, Fayyer, LEK, Sam Lek, and Pustelnik violated and are liable for the violations of the securities laws identified in the Claims for Relief section below.

11. Based on the Defendants' violations, the Commission seeks: (1) entry of a permanent injunction prohibiting the Defendants from further violations of the relevant provisions of the federal securities laws; (2) disgorgement of ill-gotten gains, plus pre judgment interest; (3) the imposition of civil monetary penalties; and (4) such other and further relief as the Court deems just and proper,