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SEC Files Fraud Charges Against Penny Stock Promoter in Microcap Stock Manipulation Scheme

The Securities and Exchange Commission recently filed securities fraud charges against a self-styled penny stock promoter for conducting a manipulative trading scheme involving over ninety microcap stocks.

The SEC’s complaint names Eric Landis of Virginia, and alleges he falsely represented to media buyers for microcap stocks that he would disseminate marketing materials for the securities through email lists with thousands of subscribers.  In truth, the SEC claims, his distribution lists did not exist.  Instead, to create volume and the fictitious impression that he was generating interest from the investing public, the SEC contends that Landis himself traded thousands of shares of microcap stocks he was compensated to promote, utilizing securities brokerage accounts titled in his name, an entity he owned and multiple third parties.  Cumulatively, the SEC charged that Landis entered thousands of fraudulent trades over a three year period, including over 1,000 manipulative “matched trades,” which occur when one sells and buys the same stock simultaneously in an effort to create the appearance of legitimate market activity.

The SEC sued Landis in U.S. District Court in Boston and charged him, and the entity he used to carry out the alleged fraudulent scheme, with violations of the anti-fraud and market manipulation provisions of the federal securities laws.  The SEC has requested a permanent injunction against future federal securities law violations, the return of ill-gotten gains, civil penalties and a penny stock bar.

This was apparently not the first day at the rodeo for Landis.  He had been previously sued by the SEC and found liable, and was criminally convicted for his role in a earlier market manipulation scheme, also known as a pump-and-dump.

If the SEC has issued you a subpoena involving a market manipulation scheme, it is critical that you are represented by an experienced SEC defense attorney who can provide the critical advice and strategic counsel to protect your interests.  SEC defense attorney David Chase, a former SEC Prosecutor, understands how the SEC investigates and prosecutes its cases. The Law Firm of David R. Chase, an SEC defense law firm located in South Florida, is headed by SEC defense attorney, David Chase, who represents those under SEC investigations around the country. Call Mr. Chase toll-free at: 800-760-0912 for a confidential and no cost initial consultation, or at david@davidchaselaw.com.