Penny-Stock Promoter Pleads Guilty to Manipulating Companies
10 5월 2016 - 5:50AM
Dow Jones News
A penny-stock promoter pleaded guilty Monday to conspiring to
manipulate stocks and laundering more than $250 million in profits,
in what prosecutors have described as one of the largest-ever "pump
and dump" schemes.
Gregg R. Mulholland pleaded guilty in Brooklyn federal court to
manipulating more than 40 publicly traded companies, including Cynk
Technology Corp., whose stock's climb and subsequent collapse in
2014 briefly gave the social-network operator a $4 billion
valuation even though it reported no assets, no revenue and just
one employee.
Mr. Mulholland, 46 years old, could face up to 20 years in
prison, according to the Brooklyn U.S. attorney's office, which
brought the charges. A lawyer for Mr. Mulholland didn't immediately
respond to a request for comment.
Prosecutors alleged Mr. Mulholland ran a broker-dealer called
the Mulholland Group, which used shell companies in Belize and
Nevis to conceal ownership in the stock of U.S. public companies.
Between 2010 and 2014, Mr. Mulholland fraudulently promoted stocks
to investors, while concealing his ownership of the companies, a
practice commonly referred to as a pump-and-dump scheme. After
driving up the value of the stocks, Mr. Mulholland would sell off
his shares and launder the proceeds through a network of offshore
entities, according to prosecutors.
The charges against Mr. Mulholland, who allegedly used aliases
such as "Stamps" and "Charlie Wolf," grew out of a wider probe into
manipulation of Cynk. One arm of the Cynk investigation has been
focused on Belize, the offshore financial center that the company
listed as its base, a person close to the probe previously told The
Wall Street Journal. Prosecutors have mined evidence from a
two-year sting operation in which an undercover agent posed as a
crooked penny-stock promoter, the person said.
On Monday, prosecutors revealed that they captured Mr.
Mulholland on court-authorized wiretaps acknowledging in May 2014
his ownership of "all the free trading," or unrestricted shares, of
Cynk in a conversation with a trader at an offshore brokerage firm
Mr. Mulholland secretly owned. Before the conversation, there had
been no trading in Cynk stock for 24 trading days. Over the next
two months, the stock of Cynk rose from 6 cents a share to $13.90 a
share.
The Cynk probe comes amid efforts by U.S. authorities to clean
up the penny-stock markets, where thousands of tiny "microcap"
companies trade with few controls on their financial reporting and
operations. Prosecutors are using an array of undercover operations
to tackle what they call rampant fraud.
Brooklyn prosecutors have charged a handful of other individuals
in connection with the probe, including Robert Bandfield, a U.S.
citizen prosecutors allege set up the network of offshore entities
used in the scheme by Mr. Mulholland and other co-conspirators. Mr.
Mulholland's secretly owned offshore brokerage, Panama-based Legacy
Global Markets SA, was set up by Mr. Bandfield, according to
prosecutors.
Mr. Bandfield has pleaded not guilty and is scheduled to go to
trial in Brooklyn federal court on May 31.
Write to Christopher M. Matthews at
christopher.matthews@wsj.com
(END) Dow Jones Newswires
May 09, 2016 16:35 ET (20:35 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
CYNK Technology (GM) (USOTC:CYNK)
과거 데이터 주식 차트
부터 6월(6) 2024 으로 7월(7) 2024
CYNK Technology (GM) (USOTC:CYNK)
과거 데이터 주식 차트
부터 7월(7) 2023 으로 7월(7) 2024