The brother of the co-founder of the former Idaho Aquarium in Boise has agreed to pay Idaho $5,000 for violating state law as he raised investment money for new aquariums in three other states.
Vincenzo Covino, of Boise, a former broker, operates aquariums in Utah and Nevada and plans one in Texas. He is the brother of Ammon Covino, who was imprisoned in 2013 for conspiring with a fellow Idaho Aquarium co-founder to bring illegally harvested spotted rays and lemon sharks from Florida to Boise for display.
Vincenzo, or Vince, Covino has been in trouble before involving investors’ money. He was registered in Idaho as a securities broker-dealer from January 1998 through December 2011, when his registration was suspended for 30 days when the securities industry’s self-regulation body, the Financial Industry Regulatory Authority, ruled that Covino had borrowed money from a client to buy a home.
He violated the Idaho Uniform Securities Act last fall by failing to disclose the 2011 disciplinary action to two investors who bought nearly a million dollar’s worth of membership interests in his new company, SeaQuest Interactive Aquariums, the Idaho Department of Finance said.
Covino on March 14 agreed to the fine, accepted the state’s account of the events and pledged to follow the law by signing an agreement and order written by the Department of Finance.
Here’s what the state said occurred:
After his 2011 suspension ended, Covino never re-registered with FINRA as a broker.
About a year and a half ago, he formed SeaQuest Interactive Aquariums with Brad Boyle, of Bountiful, Utah, and Shane Shimada, of Las Vegas. SeaQuest opened an aquarium last November in Layton, Utah and one in December in Las Vegas. It plans to open one in Fort Worth, Texas, later this year.
In November, SeaQuest sold 35 membership interests to an investor for $700,000. The next month, SeaQuest sold additional 20 memberships to a different investor for $250,000. Idaho law classifies those memberships as securities.
In a presentation to the investors, SeaQuest provided the following information about Covino: “Having been an investment adviser with a portfolio of over $165 [million], Vince has been consulting and working with entrepreneurs for two decades. Bringing his financial expertise and operations leadership, the first three years of operations aquariums has brought about over $3 [million] in profit and return to investors.”
He said nothing about his disciplinary history.
On Dec. 5, Covino filed a form saying SeaQuest paid Jon Ashton, of Eagle, a $35,000 fee for finding investors for the SeaQuest memberships. The state said Ashton is not a registered agent in Idaho.
Ashton “voluntarily returned” the $35,000 to SeaQuest on March 3, 2017, according to the state.
Covino said he is now complying with state rules.
“The personnel associated with this transaction were unaware of these specific requirements, and as soon as they were brought to our attention, immediate action was taken in cooperation with state representatives to fully comply with all requirements,” Covino told the Statesman in an email. “With guidance from the Department of Finance, we are pleased to have full approval to continue any future capital raises.”
Jim Burns, chief of the Department of Finance’s Securities Bureau, said Covino is free to raise money as long as he complies with the Idaho Uniform Securities Act. The department does not endorse or pass on the merits of any securities offering, Burns said.
A history of brotherly trouble
The three SeaQuest aquariums are not Covino’s first.
He opened aquariums in San Antonio and Austin, Texas, in 2014. He also owned an aquarium in the Portland suburb of Milwaukie, Ore., which he closed in February 2016 when the property owner sold the building.
Last November, Covino told the Statesman he divested himself of the Texas aquariums in early 2016. “Those aquariums are now owned by (Ammon’s wife) Crysty Covino and a group of investors,” he said.
Vince Covino also worked with his brother, Ammon Covino, twice in the aquarium business after Ammon Covino served his eight months in federal prison for the 2013 conviction for illegally harvesting fish for the Boise aquarium.
Those two episodes violated the conditions of Ammon Covino’s supervised release. The court barred him from any employment during his supervised release that involved the possession, display, transportation, exhibition, purchase or sale of wildlife.
Each time, Ammon Covino ended up going back to prison:
▪ A federal judge in Florida in March 2016 sent him to prison for 30 days for working with his brother’s aquariums in San Antonio and Austin.
▪ The same judge sent Covino to prison again last Nov. 30 , this time for eight months, because he helped SeaQuest from last July to last September to open aquariums in Utah and Nevada.
The Boise aquarium today
Under a court order, Ammon Covino and his fellow Idaho Aquarium co-founder, Christopher Conk, can no longer be associated with Idaho Aquarium.
The Aquarium of Boise, a nonprofit corporation with no relationship to Idaho Aquarium, now owns and operates the aquarium at Cole and Franklin roads.
When the new nonprofit took over in October 2013, the aquarium underwent extensive restructuring, including a new board, bylaws, business plan, animal care protocols and accounting system. The new board of directors hired Nancy Vannorsdel, a former banking executive and former CEO of the Boise Metro Chamber of Commerce, to run it .
Vannorsdel and her assistant, Joni Sullivan, remodeled the aquarium and added more exhibits, a classroom and education programs. They paid off debt and increased attendance, which had dwindled after Covino’s and Conk’s indictments.
Sullivan took over as director in December 2014.