Misrepresentations

July 11, 2018

The SEC filed fraud charges against a second defendant in connection with a scheme to manipulate the price of Fitbit securities through false regulatory filings. According to the SEC's complaint, Mark E. Burns purchased Fitbit call options just minutes before he and his co-conspirator, Robert W. Murray, filed a fake tender offer on the SEC's EDGAR system purporting to acquire Fitbit's shares at a substantial premium. The SEC charged Murray last year and he recently was sentenced to prison in a parallel criminal case. The false tender offer was made in the name of ABM Capital LTD – a nonexistent company for which the defendants created an EDGAR account. Fitbit's stock price temporarily spiked when the tender offer became publicly available on Nov. 10, 2016, and Burns sold all of his options for a 350 percent profit of approximately $13,000. SEC

July 9, 2018

The CFTC announced Dillon Michael Dean and The Entrepreneurs Headquarters Limited (TEH) were ordered to pay over $1.9 million in civil monetary penalties and restitution for defrauding their customers. Dean and TEH solicited at least $499,264.04 worth of Bitcoin from 127 customers by falsely promising to convert the Bitcoin into fiat currency that would be invested in a pooled investment vehicle for trading commodity interests. At least 120 customers suffered total losses of $432,184.79 as a result of Defendants’ fraud. CFTC

June 27, 2018

Financial advisor Darayl Davis was indicted for allegedly telling clients they were guaranteed to make money and then defrauding them out of $4.7 million. Davis allegedly took money from clients and then spent it for his own personal benefit including $706,000 in credit card payments, $476,500 to rent a mansion in Los Angeles, $102,000 on airfare, $42,000 on luxury hotels and other similar types of expenses. USAO NDIL

June 25, 2018

Investment Fund operator Richard Wyatt Davis, Jr. was sentenced to 90 months in prison for defrauding investors of approximately $9.3 million. Davis, Jr. induced victim to invest in funds he controlled and then used those funds to pay expenses, repay other investors, and to pay himself. Davis, Jr. made a series of false representations to the victims to induce them to invest. For example, Davis, Jr. told investors he would invest in real estate, gold mines, and water production when in reality he did not intend to invest victim money in any of those ventures. USAO WDNC

June 15, 2018

Adam Hand, a California-based former stock broker, was sentenced to 30 months in prison relating to charges of conspiracy to commit securities fraud. Hand and his brother participated in a “pump and dump” scheme that involved manipulating the price of Crown Marketing, a penny stock. Due to the scheme, investors lost over $1.5M. USAO Massachusetts

June 14, 2018

Philadelphia investment adviser Carl Frederic Sealy pleaded guilty to fraud charges in connection with a $1.6 million Ponzi scheme he operated. Sealy told investors their funds would be used to finance real estate deals, but the deals were non-existent. Instead, Sealy used his clients’ investments to fund lavish personal expenditures, including spa services, hotels, and restaurants.  USAO EDPA

June 13, 2018

Jamal Y. Vance and his company All City Investments, LLC will pay over $770,000 for fraudulently soliciting customers for forex trading and failing to register as a Commodity Trading Advisor. According to the Consent Order, Vance induced customers using false and misleading data on All City’s website, including a trading track record and purported testimonials. CFTC

June 4, 2018

Registered commodities trader and repeat fraudster Rawle Gerard Suite was sentenced to more than 10 years in federal prison for orchestrating a fraudulent investment scheme in which he concealed his identity, misrepresented the true nature of a number of shell companies he claimed were trading soybeans, gold, oil, and other commodities; the scheme caused losses of $1.6 million. USAO CDCA

May 15, 2018

Colorado attorney Diane Dalmy was sentenced to 3 years in prison and an additional 3 years of supervised release for conspiring with others to perpetrate a “pump and dump” securities fraud scheme in which she and her co-conspirators artificially drove up the price of certain stocks issued by connected shell companies by fraudulently inducing investors to purchase them, then selling their own large positions in the investments at a profit after prices rose. USAO DCT

May 15, 2018

Edward Durante was sentenced to 18 years in prison for perjuring himself during an SEC deposition and defrauding at least 100 investors, many of whom were retirees, out of over $15 million in a scheme he began while serving time in prison for a prior securities fraud conviction. USAO SDNY