Anatomy of the FLD

[overachiever]

This is what has been happening recently to Monks Den style penny stock price manipulators. 25 years in prison.

'Financial sociopath' gets 25 years for stock fraud

By MICHAEL HINKELMAN
Philadelphia Daily News

[e-mail] 215-854-2656
A Canadian man was sentenced in federal court yesterday to 25 years in prison in connection with a $55 million international stock-fraud conspiracy.

George Georgiou, 40, of Milton, Ontario, was also ordered by U.S. District Judge Robert Kelly to make restitution of $55 million to victims, many of whom lost their retirement savings.

Authorities said there were more than 1,900 victims who lost at least $1,000 each. It's not known how many, if any, lived in the Philadelphia region.

Georgiou was convicted by a jury in February of conspiracy, securities fraud and wire fraud. He denied any criminal conduct when he took the stand in his own defense.

Kelly said his testimony was "almost pathetic" in light of the "overwhelming" evidence against him.

Before sentencing, Georgiou implored Kelly for "mercy," calling himself a "God-fearing man" but admitting only to "errors in judgment."

The judge was not moved and emphasized the need to deter Georgiou and others who might contemplate similar crimes.

"I don't want a defendant to go to prison with ill-gotten gains and say, 'It was worth it. I can do the time,' " Kelly said.

First Assistant U.S. Attorney Lou Lappen asked for a 30-year sentence, describing Georgiou as a "financial sociopath."

Authorities said between April 2004 and September 2008, Georgiou and conspirators manipulated the markets of four stocks publicly traded on the so-called "pink sheets," the over-the-counter market for inactively traded stocks, including penny stocks.

Georgiou and his conspirators owned a significant amount of stock from the four companies. One of the conspirators, who lived in Bucks County and testified against Georgiou, was charged separately and sentenced by a different judge to 11 years in prison in March for fraud and money laundering.

They opened brokerage accounts in Canada, the Bahamas and the Turks & Caicos in various names and then engaged in "pump and dump" schemes with the stocks, prosecutors said.

The feds said that by trading the stocks among accounts they controlled, they artificially boosted stock prices and made it appear as though there was an active market for the stocks when there wasn't.

Georgiou and his conspirators sold shares at inflated prices for a profit and used the artificially inflated stocks as collateral to obtain millions in loans from three Bahamian brokerage firms, prosecutors said, one of which later went belly-up.

http://www.philly.com/philly/news/20101120__Financial_sociopath__gets_25_years_for_stock_fraud.html