Okay. Let's go back on the record. Once again, this is the matter of Anthony Frank Sandy and Sandy Ecom Incorporated. The docket number is SDash21343ADash24Dash06 zero two six five. Once again, I'm administrative law judge Mark Freni. I will be presiding and we'll start by taking appearances for the record beginning with counsel for the securities division. Morning, your honor. Jeremy Horn in Paul Kitchen on behalf of the securities division. Good morning. And, for mister Sandy. Good morning, honor. This is Anthony Sandy.
Anthony for Sandy. Morning, mister Sandy. Are there any procedural matters we need to address first, mister Horn? Not not first, your honor. Mister Sandy? I would just like to say, again, my name is Anthony Sandy. I'm here in good faith and without legal representation. I do not understand the legal process or rules for this hearing. And I'm not equipped to properly defend myself. I do not waive any rights and do not admit to any allegations. I respectfully object to the hearing continuing under these circumstances and ask that my inability to participate meaningfully be noted on the record. I will remain present and respectful, but cannot present evidence,
testify, or respond without counsel. Thank you. Okay. Thank you, mister Sandy. Mister Horn, are you ready to call your next witness? Yes, sir. The division calls Richard Hanna. Richard Hanna. You're here. I believe I see you. This is administrative law judge Mark Frenny. Can you hear me? Yes. I can. Okay. Mister Hanna, we're gonna have you, sworn in by our court reporter, and, then mister Horn's gonna be asking you some questions. Okay. Would you raise your right hand, please? Raise your right hand, please? I can't. Swear the testimony Okay. Now I can hear you. Do you swear the testimony you're about to give shall be the truth, the whole truth, and nothing but the truth,
so help you god? I do. Good morning, mister Hanna. Can you hear me okay? Yes. Now can you state what, city and state you're currently located in? I live in Albuquerque, New Mexico. I happen to be in Scottsdale today. And is that Scottsdale, Arizona? Yes. And what do you do for a living, sir? I am a commercial real estate broker. Are you familiar with the term accredited investor? I am. And, if so, do you believe you met the requirements to be an accredited investor in October 2023? I do. Are you familiar with the company known as Sandy Ecom Incorporated?
Yes. And how are you familiar with them? I joined Sandy Ecom on the premise that they would do ecommerce for me, and, so I, I signed up for their for their their their offering. And are you familiar with the gentleman named Anthony Sandy? I am. How are you familiar with him? We spoke a number of times, both before I purchased and and afterwards and and did, some texts as well. And during the course of your,
talking with mister Sandy, did he ever represent that he was the, person in charge or or director of, Sandy Ecom Incorporated? He did. He said he was the founder. Now before we get into your experience with SaniEcom, can you describe your investment experience and background prior to October 2023? Sure. I do I've done an extensive amount of commercial real estate. I predominantly in industrial parks and single family houses. And I work I do the same thing for clients.
And, do you have any experience or or background in noncommercial real estate investment? Some. I've subscribed to the Wall Street Journal for the last twenty years. I invest in stocks, and I have, done some, Reg d, investments as well. And was that all prior to October 2023? Yes. Now, do you know when approximately you became aware of Citi eCom and the the service, it was offering? I think that was probably about, June '23. And is that, June 2023? Yes. Do you know how you became aware of Sanitycom?
Some of the other people that I know, were were looking to invest with them, with him. And, I decided to move forward, but I heard about it through word-of-mouth. And what was the general word-of-mouth that you heard? What what was the description of Syndicom, that you you were aware of at the time? That, they could set up your stores for you, like, three of them. And, by the use of credit cards, they would do drop shipping for sales on Walmart, Etsy, and and Facebook Marketplace. So that way, you would not need to have as much capital as some of the other programs
that I had looked at. And, it appeared that, he was having some success with it. Now, were you specifically looking for an investment as opposed to, some, essentially job opportunity where you would be working, either in some capacity, with or or for a business or company? The way I understood it, he would be doing the managing of the, stores, picking the products, and making sure all of it was delivered. So my time was going to be very minimal. Now, prior to signing any agreements with Stane Ecom, did you participate in any sort of,
sales meetings or seminars with them? I did not. I, I did have a one on one with him where he presented what he was going to do and rates of return and what, he said was a typical, scenario on how it would perform. So it was just a one on one. Can you describe that conversation in terms of whether it was by phone, whether it was remote like this, like a video conference? This. It was like this. Do you know approximately when that that took place? Probably in late summer, I would guess. Of 2023?
Yeah. And do you recall what mister Sandy said to you during that that conversation? Well, that he had extensive experience in this and that, in about ninety days, it would it would begin to have a positive cash flow. And over the course of six months, it would be up to, $8,000 a month in, in net, profits. Now, did you ever have any conversations with anyone else who represented themselves as an agent or employee of Syndicom after that conversation with mister Sandy? In regard to the purchase of of his program,
you mean? Yes. Or anything just any other conversations period with Syndicom. Okay. All of the negotiations and discussions in regarding the purchase of this program were done with him. He had a good network of virtual assistants that took care of much of the work on dealing with getting websites set up and product locations and all of those things. And there were several people that I contact that I that I, was in contact with in that scenario. Now during any of those conversations with either mister Sandy directly or anyone else affiliated
with Sandy Ecom, did they ever communicate to you that either Sandy Ecom or mister Sandy, was registered as either a seller or broker to sell security? We had no conversations about that at all. And did in any of your conversations, again, with mister Sandy or anyone affiliated with Sandy Ecom, did they ever communicate to you that they were that the service or whatever was being sold to you was a registered security? No. Now, did mister Sandy during your conversations prior to you signing any agreement,
did he ever communicate did he ever tell you that there was any particular risk involved in assigning any sort of, agreement with him? He didn't specifically state there was a risk. I knew that anytime you have an investment, just from my own experience, you have some risk of that. But, mister Sandy never said that there was any particular any scenario or or event in particular? No. And and also in his agreement, he let's see. On page, let's see. Guess it was in statement of work.
Yeah. Well, mister statement of work Let let me stop you there because, we'll we'll get to the agreement in just one second. I I just wanted Okay. To to kind of focus on every anything that was said prior to the agreement, and then, I'm gonna quickly move on to the agreement after that. Okay. He, he did say that, and he was confident enough in his work that, he would if if after the first year, he would not have any commissions due so that I could earn that earn my fee that I paid him back. And that was one of the things that that he had in the agreement and
also that he had discussed prior to me signing the agreement. So, mister Sandy never communicated to you that there was a risk that Sandy Ecom Ecom would not be able to set up an ecommerce store on a given platform on your behalf? Correct. When when you say right, do you mean that he never did? He never expressed that? He never did. Yeah. He never he never did. And and did mister Sandy ever ever tell you that there was a risk that you might that any given ecommerce store on any given platform that's in ecom opened and operated on your behalf might not be profitable?
Not prior to the agreement. No. Now, I wanna direct your attention to the the service agreement itself. Did you sign an investment services agreement or or service agreement with Sendingecom on 10/24/2023? Yes. And I have on 10/24/2023? Yes. And I have it with me. Okay. And the one you have in front of you, do you have a document that has a stamp on it, titled exhibit s dash seven? Yes. And, what is that document? The the That is the that is the service agreement that I signed. And just to, direct your attention to
page 12 of that document, s seven s dash seven, does it include on page 12, your name? Yes. It does. The bottom. And And that's my signature. Okay. That was gonna be my next question. And does it also include, mister Anthony Sandy's name? It does. And does it include a digital signature, at least, that that has the name of Anthony Sandy? Yes. And, are are there two different dates on this, this page 12 by the signature? Yes. Is one of the dates by mister Sandy's electronic signature,
10/12/2023? Yes. And is, is there a date by your signature? Yes. That's 10/24. 10/24/2023? Yes. Is this a fair and accurate copy of the service agreement and statement of work that you signed with, mister Sandy and Sandy Ecom? Yes. With the exception of the redactions. Your honor, at this time, the division would move to have exhibit s seven entered into evidence. Mister Sandy, any objection to exhibit s seven? Respectfully, your honor, I don't feel equipped to respond without legal representation.
Exhibit s seven is admitted into evidence. Now, mister Hanna, if I could direct your attention to page nine of the document, that has the, title exhibit a statement of work. Yes. Do you see about halfway down the page where it has, sub paragraphs a, b, c, and they all begin with company shall shall set up? Yes. Do those three paragraphs, those three sentences, describe what ecommerce stores that same ecommerce agreed to set up on your behalf? Yes. And specifically, with or in Facebook Marketplace,
Etsy seller, and Walmart seller? Yes. And then, turning your attention to page 10, the next page, at the first full paragraph, sub paragraph I, do you see that paragraph? Company show create. And does it also say that, cindy.com agrees to create a Shopify store, website on Shopify store for or on behalf of you? Yes. And then, further down on page 10, there's a in in room numeral two, sub paragraph b, it states there's a one time fee of $30,000. Is that the amount of money that you agreed in this agreement to invest with
Sandecom to open up the three ecommerce stores? Yes. Now you were mentioning that you specifically negotiated with mister Sandy to hold off, any sort of, revenue sharing for one year. Is is that correct? What, was to happen is if after the one year point that, if, I had not earned back my 30,000, he would work with no commissions. I I don't recall if that was he was going to do that or until I got it all back. I only remember that as if if I hadn't earned 30,000
by that point the one year point, then he would work without commissions until I, was fully repaid. And so, since this agreement was signed by you, at least, on 10/24/2023, can you describe what happened in the next few months after signing this agreement? The webs the, websites were very slow in getting, put up, and the I had Walmart set up. He did some work on that. He was having difficulty with the others. He formed a, one, for my
eBay account that I already had. He set up the seller side and that one, for eBay, his performance was such that I was banned from my site because he was not delivering on a timely basis or not time delivering at all. And when he did deliver, I was losing money. The Walmart side was, right about breakeven. So, at the let's just pick a point at, around six months after signing this agreement, so roughly in March or April 2024.
Were all three accounts, the Facebook Marketplace, Etsy seller, and Walmart seller accounts opened for for you on your behalf by San Diego? No. I don't remember ever seeing Shopify. Facebook Marketplace never did anything. The only, one that actually was operational was the Walmart, and that one was, not really making any money. And the Facebook, of course I mean, the, eBay one was losing money. And I noticed in here in in the statement of work that it doesn't specifically mention an eBay, account. Do you know why that was set up on your behalf?
Yes. Because he was having difficulty getting the other one set up. And, how was that communicated to you that there was a problem setting up one or more accounts on your behalf on one of these platforms? He had only mentioned that it was needing to take more time. He didn't really give a specific reason. And, ultimately, did was there any kind of amended agreement or or amendment to this agreement that stated that St. Ecom agreed to set up an eBay account on your behalf in lieu of one of these named accounts? No. It was really in addition.
And so, you mentioned that at at for one of the accounts, I I forgive me. I I I didn't mark down which, that you actually were losing money on? Yes. Which account was that? That was the eBay. And can you describe why you were losing money on that account? Because, between the cost of, the eBay commissions and the shipping costs with the with what he was selling the products for wasn't enough to cover what the, what what we were bringing in. So, ultimately, was the eBay account,
that Syndicom set up on your behalf not profitable? It was not profitable, and, also, they shut it down because of poor performance from from a standpoint of being able to service the customer. So if someone was going to if someone purchased something from my store, it took a very long time for it to show up, or it would, not show up at all. And did Sandy Ecom shut down that account on your behalf, or did eBay directly do so? EBay did. How were you informed that eBay shut it down?
I was notified on my site, on the on the eBay account. Was it through, like, some sort of message or email from eBay directly to you? Yeah. There were lots of, warnings that the, performance was subpar and that if it continued, they would dis they would, shut the account down. Now did you speak to anyone at Sandy ecom about, first, the delays in opening stores on your behalf and then the complete failure to open certain stores on your behalf? Yes. Both his virtual assistants and Anthony Sandy.
I don't remember the dates, but I had numerous conversations along those lines. And what was the response from either mister Sandy or anyone at tinniacom about that? Well, when I was to begin with the, when we weren't getting the stores opened and, Anthony Sandy offered to, sell on eBay since I already had an account set up. That was kind of a conciliatory thing to kind of think keep things the e commerce company moving. But I still ultimately wanted all of the stores operational. But I got a lot of excuses.
And when you say, that you wanted all the stores operational, do you mean all the stores that are listed in the statement of work, the Facebook Marketplace, Etsy seller, and Walmart seller accounts? Yes. Did, to to your knowledge, did sandyecom ever resolve whatever issues they had in opening an Etsy seller and Walmart seller account on your behalf? Re repeat that question again, please. To your knowledge, did say anyone at santeeecom ever resolve the problem that they had in opening up, Etsy seller or Walmart seller accounts on your behalf?
They were they were never resolved. I subsequently found out on Etsy that, I probably would not ever be eligible for an Etsy account because that is predominantly a, home a homemade goods store. So you need to be the one that is creating the goods, like crafts or something like that. And how did you find out that information? My own research, subsequent to the the delays. Was that information you you researched directly on the e Etsy, website or app? Correct. That was never communicated to me by, Sandy Ecom.
So, ultimately, of the $30,000 you invested with Sandy Ecom, how much did you how how much were you able to recoup? Zero. And did you lose did you lose any additional money, that you weren't weren't able to recoup from the, the eBay store that you mentioned? Yeah. That was probably a net negative of about $1,500. So overall, the total investment that the total investment loss that you suffered with, Sandy Ecom and mister Sandy, was that approximately, $31,000?
Correct. And can you describe how this experience with sandycom has affected you? I was optimistic that, e commerce was a good investment, and I have seen other companies do these kinds of things quite well. So my loss of revenue, his promise of $8,000 a month would have been significant, even if I believe that he might be able to have achieved know, $4,000 a month. So part of that, I was looking at as retirement income.
And has the loss of of the approximate $31,000, has that affected you personally or financially? Well, it's always bad to Well, it's always bad to lose money. I I happen to have enough resources and still working that it's not like I can't eat, but I would certainly would have rather have had the 30 than have lost the 30. And, mister Hanna, that's all the questions that I had for you. Is there anything else you wanted to say that that I might not have covered or or asked you specifically? No. K. Thank you, sir. Please stand by. There may be more questions for you. Thank you. I will.
Mister Sandy, do you have any questions you'd like to ask this witness? Your honor, respectfully at this time, I don't feel equipped to respond with legal representation. Okay. Thank you. Mister Hanna, I think I may have one question for you. You you testified that you're a resident of New Mexico. Was that true at the time you made your investment with Sandy Ecom? Yes. Okay. I believe that's all I have. Mr. Horn, do you have anything additional based upon my question? No, you're gonna. May this witness be excused? Yes, sir. Mr. Hanna, thank you very much for appearing today and testifying for us.
You're now free to exit the teleconference from your own end. Thank you. Okay. Thank you. Bye. Mister Horn, do you have an additional witness that you'd like to call at this time? Your honor, at this time, I'd like to address the issue of, the division calling mister Sandy as a witness and his, refusal to testify. This morning prior to the beginning of this hearing, the division did serve a subpoena on mister Sandy. Of course, that's mid hearing. But I do have a list of the written questions that I was planning to ask mister Sandy. Emailed mister Sandy a copy of these questions last night and also left a paper
copy for him, prior to the start of this hearing. Mister Sandy, would you like to respond to that? Respectfully, your honor, I invoke my right to not testify at this time. I'm not refusing to cooperate. I simply do not have the legal knowledge or resources to protect myself while I'm represented. I respectfully object to testifying. I was handed a subpoena just minutes before the hearing, and the accompanying affidavit of service is blank. There's no record of proper service, and I had no opportunity to review it with legal counsel or prepare. I do not waive any rights, and I decline to testify at this time. Okay. Mister Horne, do you wanna state anything on the record before
I before I say something? Yes, your honor. I do have the the list of written questions, that was missing yesterday. So I would just ask the court to consider this as an offer of proof of the questions that the division had planned to ask mister Sandy and just to confirm the basis the legal basis of his refusal to testify. Okay. I'm not going to require mister Sandy to testify today. If you wish to read into the record your list of questions, you may do so. Or do you wish to submit that as an exhibit? What is your desire with the list?
In the interest of time, your honor, it it would probably be, more judiciously efficient to, submit this as an exhibit rather than just read it. And this is approximately, the five and a half pages of questions. Okay. I don't know that we need to lay any. Sorry, your honor. May I elaborate? I'm sorry. I couldn't hear you. May I elaborate? Please. So, what specifically we want to do is just establish adverse inferences for questions that, you know, we intend to answer. When a mister Sandy responded yesterday, he appeared to be invoking his right against self incrimination. He's certainly welcome to do that.
We can't make him answer questions. We'd like to establish the questions we are answering to make clear that he's declining to answer so as not to incriminate himself and that we can make a record of what the questions are that are being put to him just to establish what those, adverse inferences are. I I I'm willing to allow you to offer either an exhibit or to read questions in. Mister Sandy is not being represented by an attorney. I don't think he's specifically invoking his his fifth amendment right,
and apparently has not been advised regarding any of these questions as as he's not been shown them before. And I don't believe he's have you seen them today, mister Sandy? Have you been handed them the questions themselves? I I didn't see any questions until today. Okay. My inclination is to allow you to either submit these as an exhibit or read them into the record as your choice and present argument in closing brief as to how either the exhibit
or the questions as stated should be interpreted by me and the commission. I don't know if that satisfies you, mister Kitchen, but you're certainly free to respond to that. Sure. I I don't know if that has the, legal effect that we desire. And while he might not have seen the questions before, a witness typically isn't entitled to have prior knowledge of, what the questions are, just that they are going to be called. And we we have at least signaled that well in advance by listing him as a witness,
and he is he is here. I I don't disagree that he's physically present. I'm not going to compel him to to testify, and he has stated that he is, by choice not testifying. Again, you may have the opportunity to argue. However, myself and the commission should take that. But, again, I'm I'm not going to ask him to come up to the the the stand and have him respond to individual questions. Okay. Thank you, your honor. Honor. Okay. Mister Horne, I don't know how how then you wish to proceed. If you wish to read the questions into the record or submit them as an
exhibit or something different. Your honor, I I would request to, submit them as an exhibit, and I believe they would be marked as exhibit, s 18. And, since I would like the the, your honor to to consider this, we would move to have exhibit s 18 be entered into evidence. Okay. Do we have a a copy of the proposed s 18 for, both myself, mister Sandy, and, official copy for the record? One is being made, for the, record, your honor. I have additional one for for you,
and I provided mister Sandy with one prior to the start of this hearing. Mister Sandy, you have have that already? Okay. I've been handed what, is not physically marked, but will be labeled as exhibit s 18. Mister Horn, I believe you've already moved it for its admission? Yes, sir. K. Mister Sandy, do you have a position regarding the admission of Respectfully, your honor, at this time, I don't feel equipped to respond without legal representation. K. Thank you. Exhibit s 18 is admitted into evidence. Mister Horn? Your honor, there are no further witnesses that the division wishes to call, so the division rests.
Okay. Mister Sandy, I'm assuming you do not wish to present any, testimony, witnesses, evidence at this time, but I'm going to give you the opportunity to do so if you so desire. Respectfully, your honor. At this time, I don't feel equipped to respond with that legal counsel. Okay. Before we go ahead and close the record, mister Horn, I just wanna confirm that, what I have is as listed as having been admitted, from the exhibits, that you've made available is correct and that nothing has been overlooked. So what I have listed as having been admitted are exhibits s dash one,
s two, s four, s five, s six, s seven, s 10, s 15, s 16, s 17, and s 18. Is that correct, mister Horn? Yes, sir. Okay. And the remainder of the, exhibits are not being offered? Yes, sir. Okay. Thank you. Alright. I am going to request closing briefs be submitted, with a briefing schedule being that the division would submit a post hearing brief. Respondents would have an opportunity to file a brief and re a response brief, and then the division would have a final,
reply to that. Mister Sandy, I understand that you have not participated actively to this point. I'm still giving you an opportunity to file a written brief based upon the evidence that's been admitted and whatever the division files in their post hearing brief. So I am gonna give you an opportunity to respond to that if you desire, and I'm going to allow time for that. Before I address the schedule of the briefs, I'm gonna allow the parties to make a plea a brief closing statement if they
desire to do so. Mister Horn, do you wish to make us a closing statement for the division? Yeah. K. Mister Sandy, do you wish to make a closing statement? No. K. I guess before before before I come up with a briefing schedule, I'll briefly go off the record to allow the parties an opportunity to discuss the scheduling, amongst themselves. My understanding is that completion of a transcript transcript takes ten business days plus one day for each additional day of hearing. So I believe that would be eleven business days for this.
But once we're off the record, if the parties have questions, they can address that to the court reporter who would know more specifically than I. So let's briefly go off the record. I'll give you, give the parties about five minutes to discuss a briefing schedule, and then we can, hammer that on the hammer that out on the record. So we're in a brief recess. Okay. Let's go back on the record. Mr. Horn, have you and Mr. Sandy had an briefing schedule? I've briefed you, your honor, but I don't think we've agreed on the, specific dates yet. Mister Sandy just stepped out and just came back in for a time. Oh, okay. Would it benefit to, go off the record again for a few minutes then?
Yes, please, sir. Okay. We'll go back off the record. Thanks. Okay. Let's go back on the record. Mister Horn, have you had an opportunity to discuss a briefing schedule with the respondent? Yes, your honor. I believe we reached agreement. K. Could you, please inform me of the the schedule that you have agreed to? Yes, your honor. We would propose March 30 as the date of the, securities division, brief to be due, with a, respondents a response due, on May 15, and then a reply brief from the securities division due on June 1. Bear with me a moment while I'm looking at my calendar.
Okay. Just to confirm I've heard those dates correctly, the deadline for the securities division to file a post hearing brief will be 03/30/2026. '6. The respondents will have a deadline of 05/15/2026 to file their response, and then the securities division will have a deadline of 06/01/2026 to file a reply. Is that correct, mister Horn? Yes, sir. Mister Sandy, is that your understanding? Yes, sir. Okay. Yes, sir. Honor. Okay.
Thank you, mister Sandy. Alright. I believe that concludes everything that I need to have done. I just wanna give the parties an opportunity if they wanna put anything else on the record while we're here for today. Mister Horn, anything additional? No. No. Thank you, sir. Mister Sandy, anything additional? No. Thank you, your honor. Okay. This matter will be taken under advisement. After receipt of the written briefs, I will be filing a I'll be drafting and and filing a recommended opinion in order, for consideration by the commission at a future open meeting date.
I thank you all for appearing, and we are now adjourned.