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17:10:22 Today DJDAY IBOT UPDATE: IN THE MONEY:Sting Leads To Arrest Of 2 Stk Promoters

By Carol S. Remond
A DOW JONES NEWSWIRES COLUMN


A Federal Bureau of Investigation sting operation resulted in the arrest of
two Costa Rica-based stock promoters accused of conspiring to commit securities
fraud.

One of the men, Jonathan Curshen, was arrested on Sept. 4 and has been
released on bail. The other, Bruce Grossman, was arrested on Sept. 5 in New
Orleans and remains in jail.

According to a sealed complaint, Curshen and Grossman conspired to bribe
brokers who would enter in arranged transactions through which the men would
sell securities they owned at pre-determined prices.

The complaint, filed in the U.S. district Court for the Southern District of
New York, shows that, unbeknown to them, the men were dealing with an
undercover FBI special agent who purported to represent a group of registered
brokers willing to purchase stock in client accounts over which they had
control.

The FBI used an undercover trading account at a New York City brokerage firm
to purchase stock in Washington-based Industrial Biotechnology Corp. (IBOT) in
pre-arranged transactions with Grossman and Curshen.

Between June 27 and July 2, the FBI spent about $76,000 purchasing Industrial
Biotechnology stock that the two men arranged to sell to purported customers of
stockbrokers working with the undercover FBI agent who arranged the
transactions with Grossman and Curshen.

In exchange, according to the complaint, the defendants wired $19,000 to an
undercover FBI bank account as kickback to the undercover FBI agent and the
brokers for having arranged the transactions.

The wired money came from an account in the name of Sentry Global Securities
Limited in San Jose, Costa Rica.

According to the complaint, Curshen and the undercover FBI agent agreed on
July 22 that the special agent would purchase $2.5 million worth of Industrial
Biotechnology stock over the next three months. Under the deal, the agent would
receive 25% of the proceeds of the amount of stock purchased by the "customers"
of the brokers the agent purported to represent.

According to the complaint, the agent told the men he kept 5% of the bribe
and would distribute 20% to the brokers who kept the payoff secret from their
customers.

Curshen and Grossman were charged by complaint and the government has 30 days
to indict them.

Anthony Lombardino, a lawyer for Curshen, said he is hoping that the matter
can be resolved without an indictment. A lawyer for Grossman couldn't be
reached.

The two men were also charged in a complaint filed by the Securities and
Exchange Commission on Wednesday, also in the Southern District Court of New
York. The SEC is seeking to enjoin Curshen and Grossman from further securities
violations and to have them disgorge their ill gotten gains.


(Carol S. Remond, a special writer on the In The Money team, is an
award-winning columnist who won a Gerald Loeb Award in 2005 for best news
service content with "Exposing Small-Cap fraud," a series of articles that
described how three small companies unscrupulously pumped up their stocks. She
can be reached at 303-997-5783 or by e-mail: [e-mail])


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(END) Dow Jones Newswires

09-11-08 1710ET

Copyright (c) 2008 Dow Jones & Company, Inc.

17:10 091108