DD Support Board and Research Team

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FUEG - 7 arrested in connection with the FUEG pump&dump scheme

http://www.vosizneias.com/127514/2013/04/04/new-york-7-arrested-in-pump-and-dump-penny-stocks-scheme

DEFENDANT RESIDENCE - AGE:
ALEXANDER GOLDSHMIDT Morganville, NJ 47
ALEX PUZAITZER Brooklyn, NY 52
MICHAEL VAX West Orange, NJ 54
PAUL ORENA Atlantic Beach, NY 38
YITZ GROSSMAN Valley Stream, NY 58
EFIM AKSANOV Sunny Isles, FL 39
STEVE KOIFMAN Boca Raton, FL 41



From 2012 through March 27, 2013, GOLDSHMIDT, PUZAITZER, VAX, ORENA, GROSSMAN, AKSANOV, and KOIFMAN conspired to commit securities fraud. As part of their “pump and dump” scheme, various defendants acquired control of a large block of shares of Face Up Entertainment Group, Inc. (“FUEG”), and then inflated the stock price and trading volume of FUEG before selling, or “dumping,” those shares at inflated prices to unsuspecting traders for a profit.

FUEG was a publicly traded company that was purportedly involved in the reality gaming social network market with its principal place of business located in Valley Stream, New York. As captured through judicially authorized wiretap interceptions, the defendants coordinated control over a significant portion of FUEG shares and then promoted the stock through the dissemination of false press releases sent over the Internet. In addition, the defendants coordinated trading of FUEG shares to create the impression of increased trading volume to make FUEG appear to be an attractive purchase for unsuspecting investors. However, the defendants were unable to reap a profit from trading FUEG stock timed to the promotions, and their scheme ultimately failed.

As a result of the failed promotion of FUEG stock, GOLDSHMIDT, PUZAITZER, VAX, ORENA, GROSSMAN, AKSANOV, and KOIFMAN conspired to extort one of their co-conspirators, referred to as “CC-1” in the Complaint. In the summer of 2012, AKSANOV, KOIFMAN, GOLDSHMIDT and PUZAITZER met with CC-1 in New York, New York, and demanded that CC-1 pay them $350,000 and return shares of FUEG, or AKSANOV would “put slugs into” CC-1’s chest.

In several subsequent telephone calls and meetings, various defendants continued to demand that CC-1 repay them for their stake in the failed FUEG scheme, or they would harm CC-1. During a meeting on or about March 5, 2013, GOLDSHMIDT, PUZAITZER, ORENA and VAX met with CC-1 at a hotel in New York City and further threatened CC-1 and CC-1’s family if CC-1 did not comply with their demands.

GOLDSHMIDT, PUZAITZER, VAX, ORENA, GROSSMAN, AKSANOV, and KOIFMAN are each charged with one count of conspiracy to commit securities fraud, which carries a maximum penalty of five years in prison, and one count of conspiracy to commit extortion, which carries a maximum penalty of 20 years in prison.


http://www.vosizneias.com/127514/2013/04/04/new-york-7-arrested-in-pump-and-dump-penny-stocks-scheme