securities and investment fraud crackdown lead to the arrest of 15 people on June 1 by South Florida federal
U.S. Attorney Wifredo Ferrer reported that since December 2010 federal
authorities have made
85 arrests as part of the Securities and Investment Fraud Initiative, resulting in
over $1.5 billion in restitution being leveled. Those accused in June
include small business presidents and a man claiming to possess a Federal
Reserve note worth $500,000,000.
Undercover FBI sting operations are responsible for the arrests based in
Broward County in alleged manipulation of penny stocks. Eight heads of
small companies have been charged with offering illegal kickbacks or attempting
to artificially inflate their businesses’ stock in an effort to
get rid of them and make a profit.
Heads of companies arrested include those of Delivery Technology Solution,
Clean Coal Technologies, and Wound Management Technologies. The president
of Delivery Technology Solutions, of Boca Raton, already pleaded guilty to
mail fraud charges and was sentenced in July.
The Security and Exchange Commission, or SEC, has filed civil suits against
the small business presidents which would prevent them from ever again
having any involvement with penny stocks.