Federal Defense Attorney John Teakell

The U.S. Department of Justice announces a 24-count indictment against five individuals alleging manipulation of publicly traded stock of three companies and profiting more than $41 million in the scheme.  Defendants include G. David Gordon, a Tulsa, Oklahoma attorney; Richard Clark of Tulsa; Louisville, KY-based attorney James Reskin; Bahamas resident Dean Sheptycki; and Dallas, TX resident Joshua Wayne Lankford.

Gordon, Clark and Reskin have all been arrested in relation to the <a href=”http://www.federaldefensecases.com”>federal charges</a> and are awaiting initial appearances.  Sheptycki has been withheld by Bahamian authorities and is to be extradited to the United States.  Lankford, however, has not been arrested to date.

The case involves three different companies’ stocks, including Deep Rock Oil & Gas, Inc., Global Beverage Solutions, Inc. (formerly Pacific Peak Investments) and National Storm Management Group, Inc.  Allegations include that between April 2004 and December 2006, the defendants engaged in a “pump and dump” scheme to manipulate the price of penny stock shares and encourage investors to buy them, then sell their personal holdings at a significant profit.

Charges state that the defendants bought a majority of the free-trading shares of the companies using fraudulent and deceptive means to remove trading restrictions.  It is alleged that the defendants bought their shares before hiding them with friends, family and entities which they owned and controlled.  Then, they allegedly coordinated trading activities to give the appearance of an emerging market after promoting the stocks through unsolicited fax and e-mail campaigns.

These campaigns allegedly did not disclose who was sponsoring them, the fact that the investors intended to sell their shares, and further influenced investors to invest in the artificially inflated stocks.  Subsequently, the sell-offs conducted by the defendants caused the stock prices to deflate and drastically reduce the value of stock held by legitimate investors.

Each of the five defendants is charged with one count of conspiracy to commit securities fraud, wire fraud and money laundering, nine counts of wire fraud, five counts of securities fraud, and six counts of money laundering in the indictment.  Gordon faces additional charges of one count of making false statements regarding the scheme, and one count of wire fraud and one count of obstruction of justice in connection with a similar scheme regarding the penny stock of International Power Group Ltd.

The defendants in this case are accused of profiting more than $41 million from the alleged manipulation scheme, and the indictment seeks the criminal forfeiture of this total.  Additionally, federal prosecutors are seeking a criminal fine of $2.75 million from Gordon in connection with his additional wire fraud charge.

Federal conspiracy and false statement charges can carry up to five years in prison and $250,000 in fines.  The wire fraud and obstruction of justice charges carry a maximum of 20 years in prison and $250,000 in fines.  Each securities fraud charge carries a maximum of 20 years in prison and a $5,000,000 fine, and the money laundering charges can carry a total of 10 years in prison and $250,000 in fines.

The SEC has also filed civil charges against Gordon, Lankford and Sheptycki in relation to this case.

This entry was posted on Thursday, February 19th, 2009 at 6:31 pm and is filed under Fraud. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.