11/10/2015 153 ELECTRONIC NOTICE OF RESCHEDULING as to Mitchell Brown. Sentencing reset for 1/21/2016 02:00 PM in Courtroom 18 before Judge William G. Young. (Gaudet, Jennifer) (Entered: 11/10/2015)
11/09/2015 152 Judge William G. Young: ELECTRONIC ORDER entered granting 151 Assented to Motion to Continue as to Michael Affa (1). Sentencing reset for 1/8/2016 02:00 PM in Courtroom 18 before Judge William G. Young. (Gaudet, Jennifer) (Entered: 11/09/2015)
11/06/2015 151 Assented to MOTION to Continue Sentencing to 1/8/2016 as to Michael Affa. (Goldstein, Robert) (Entered: 11/06/2015)
1:14-cr-10221-WGY USA v. Affa et al 1:14-cr-10221-WGY-1 Michael Affa 1:14-cr-10221-WGY-2 Andrew Affa 1:14-cr-10221-WGY-3 Mitchell Brown 1:14-cr-10221-WGY-4 Christopher Putnam 1:14-cr-10221-WGY-5 Christopher Nix
United States District Court District of Massachusetts (Boston) CRIMINAL DOCKET FOR CASE #: 1:14-cr-10221-WGY All Defendants Case title: USA v. Affa et al Magistrate judge case numbers: 1:14-mj-01051-RBC 1:14-mj-01052-RBC 1:14-mj-01053-RBC 1:14-mj-07112-JCB
Assigned to: Judge William G. Young
Defendant (1) Michael Affa also known as Michael A. Affa represented by Robert M. Goldstein 20 Park Plaza, Suite 1000 Boston, MA 02116 617-742-9015 Fax: 617-742-9016 Email: rmg@goldstein-lawfirm.com LEAD ATTORNEY ATTORNEY TO BE NOTICED Designation: Retained
Pending Counts Disposition 18:371...CONSPIRACY TO COMMIT SECURITIES FRAUD AND WIRE FRAUD (1) 15:78j(b), 78(ff); 17 C.F.R. SEC. 240.10b5; AND 18:2...SECURITIES FRAUD (2) 18:1343, 1349, AND 2...WIRE FRAUD (3-7)
Highest Offense Level (Opening) Felony
Terminated Counts Disposition None
Highest Offense Level (Terminated) None
Complaints Disposition 18:371 - CONSPIRACY Assigned to: Judge William G. Young
Defendant (2) Andrew Affa also known as Andrew J. Affa represented by Steven E. Losquadro 649 Route 25A Suite 4 Rocky Point, NY 11778 631-744-9070 Fax: 631-744-9421 Email: losquadrolaw@aol.com LEAD ATTORNEY PRO HAC VICE ATTORNEY TO BE NOTICED Designation: Retained
William H. Connolly Law Offices of William H. Connolly 20 Park Plaza Suite 1000 Boston, MA 02210 617-542-0200 Email: whc@williamconnollylaw.com ATTORNEY TO BE NOTICED Designation: Retained
Pending Counts Disposition 18:371...CONSPIRACY TO COMMIT SECURITIES FRAUD AND WIRE FRAUD (1) 15:78j(b), 78(ff); 17 C.F.R. SEC. 240.10b5; AND 18:2...SECURITIES FRAUD (2) 18:1343, 1349, AND 2...WIRE FRAUD (3-7)
Highest Offense Level (Opening) Felony
Terminated Counts Disposition None
Highest Offense Level (Terminated) None
Complaints Disposition 18:371 - CONSPIRACY Assigned to: Judge William G. Young
Defendant (3) Mitchell Brown also known as Mitchell H. Brown represented by Richard Roth 295 Madison Avenue Floor 22 New York, NY 10017 (212) 542-8882 Fax: (212) 542-8883 LEAD ATTORNEY PRO HAC VICE ATTORNEY TO BE NOTICED Designation: Retained
Danielle Pomeraniec The Roth Law Firm, PLLC 295 Madison Avenue Floor 22 New York, NY 10017 (212) 542-8882 Fax: (212) 542-8883 Email: danielle@rrothlaw.com PRO HAC VICE ATTORNEY TO BE NOTICED Designation: Retained
Robert S. Messinger Nystrom Beckman & Paris LLP One Marina Park Drive, 15th Flr. Boston, MA 02210 617-778-9104 Fax: 617-778-9110 Email: robert.messinger@gmail.com ATTORNEY TO BE NOTICED Designation: Retained
Pending Counts Disposition 18:371...CONSPIRACY TO COMMIT SECURITIES FRAUD AND WIRE FRAUD (1) 15:78j(b), 78(ff); 17 C.F.R. SEC. 240.10b5; AND 18:2...SECURITIES FRAUD (2) 18:1343, 1349, AND 2...WIRE FRAUD (3-7)
Highest Offense Level (Opening) Felony
Terminated Counts Disposition None
Highest Offense Level (Terminated) None
Complaints Disposition 18:371 - CONSPIRACY Assigned to: Judge William G. Young
Defendant (4) Christopher Putnam also known as Christopher R. Putnam represented by Joshua Robert Hanye Federal Public Defender's Office 5th Floor 51 Sleeper Street Boston, MA 02210 617-223-8061 Email: joshua_hanye@fd.org LEAD ATTORNEY ATTORNEY TO BE NOTICED Designation: Public Defender or Community Defender Appointment
Pending Counts Disposition 18:371...CONSPIRACY TO COMMIT SECURITIES FRAUD AND WIRE FRAUD (1) 15:78j(b), 78(ff); 17 C.F.R. SEC. 240.10b5; AND 18:2...SECURITIES FRAUD (2) 18:1343, 1349, AND 2...WIRE FRAUD (3-7)
Highest Offense Level (Opening) Felony
Terminated Counts Disposition None
Highest Offense Level (Terminated) None
Complaints Disposition 18 U.S.C. § 371 Conspiracy to Commit Securities Fraud. Assigned to: Judge William G. Young
Defendant (5) Christopher Nix also known as Gabe Nix also known as Christopher G. Nix represented by Jonathan L. Kotlier Nutter, McClennen & Fish, LLP Seaport West 155 Seaport Boulevard Boston, MA 02210-2604 617-439-2000 Fax: 617-310-9683 Email: jkotlier@nutter.com LEAD ATTORNEY ATTORNEY TO BE NOTICED Designation: Retained
Pending Counts Disposition 18:371...CONSPIRACY TO COMMIT SECURITIES FRAUD AND WIRE FRAUD (1) 15:78j(b), 78(ff); 17 C.F.R. SEC. 240.10b5; AND 18:2...SECURITIES FRAUD (2) 18:1343, 1349, AND 2...WIRE FRAUD (3-7)
Plaintiff USA represented by Eric A. Forni United States Attorney's Office MA Suite 9200 1 Courthouse Way Boston, MA 02210 617-573-8827 Email: eric.forni@usdoj.gov LEAD ATTORNEY ATTORNEY TO BE NOTICED Designation: Assistant US Attorney
Vassili Thomadakis US Attorney's Office - MA J. Joseph Moakley U.S. Courthouse 1 Courthouse Way Suite 9200 Boston, MA 02210 617-748-3248 Email: vassili.thomadakis@usdoj.gov LEAD ATTORNEY ATTORNEY TO BE NOTICED Designation: Assistant US Attorney
Andrew J. Palid Securities and Exchange Commission - MA 33 Arch Street 23rd Floor Boston, MA 02110-1424 (617) 573-4540 Email: palida@sec.gov ATTORNEY TO BE NOTICED
On Tuesday, Dec. 8, 2015, Mitchell Brown, 50, pleaded guilty to one count of conspiracy and one count of securities fraud for his participation in the Greenway pump-and-dump scheme. U.S. District Court Judge William G. Young scheduled sentencing for Jan. 21, 2016.
Department of Justice U.S. Attorney’s Office District of Massachusetts FOR IMMEDIATE RELEASE Friday, December 11, 2015
California Attorney Indicted and New Jersey Stock Promoter Convicted in Stock Manipulation Scheme
BOSTON – A California-licensed attorney was indicted in U.S. District Court in Boston yesterday on charges arising out of his participation in a scheme to manipulate the shares of a publicly-traded microcap company. Earlier this week, a New Jersey man pleaded guilty to charges related to his participation in the same scheme.
Jehu Hand, 59, was indicted on charges of conspiracy to commit securities fraud and wire fraud, securities fraud and wire fraud based on his involvement in a pump-and-dump scheme to manipulate the market and to sell unregistered shares of the stock of Greenway Technology. Greenway was a microcap or “penny stock” company that claimed to be on the verge of acquiring hotels that would cater to gay travelers in several major cities.
On Tuesday, Dec. 8, 2015, Mitchell Brown, 50, pleaded guilty to one count of conspiracy and one count of securities fraud for his participation in the Greenway pump-and-dump scheme. U.S. District Court Judge William G. Young scheduled sentencing for Jan. 21, 2016.
According to court documents, in 2012, Hand, Brown and their co-conspirators engaged in a scheme to obtain and conceal their control over the majority of Greenway’s stock so that they could “pump” up the company’s share price and then secretly “dump” their shares into the market by selling at the inflated price. Hand issued false legal opinion letters to Greenway’s transfer agent and to stock brokers. The opinion letters, which intentionally disguised the conspirators’ control over Greenway’s stock, enabled Hand, Brown and their co-conspirators to obtain and sell Greenway’s stock in the open market in violation of federal securities laws. Hand also created and backdated convertible promissory notes. Hand then relied on the false date on the convertible promissory notes when providing his legal opinion that federal securities laws had been followed and that the notes could be converted into seven million shares of Greenway stock, which were then issued to entities controlled by Brown.
With millions of shares of Greenway stock at the conspirators’ disposal, Brown and another co-conspirator, proceeded to hire stock promoters to send blast e-mails that reached many potential investors, including those in Massachusetts, and contained misleading information touting Greenway’s stock. As a result of the hype created by the false and misleading promotional campaign, Hand, Brown and their co-conspirators were able to sell their Greenway stock to unwitting investors at artificially high prices.
These charges arise out of a multi-year investigation focusing on preventing fraud in the microcap stock markets. Microcap companies are small publicly traded companies whose stock often trades at pennies per share. Fraud in the microcap markets is of increasing concern to regulators as such markets have proven to be fertile grounds for fraud and abuse. This is, in part, because accurate information about microcap stocks may be difficult for the average investor to find, since many microcap companies do not file financial reports with the Securities and Exchange Commission (SEC).
The charges and conviction follow a series of cases filed by the U.S. Attorney for the District of Massachusetts and the SEC in which more than 30 individuals have been criminally charged and convicted for using kickbacks and other schemes to trigger investment in, or manipulate the stock of, thinly-traded stocks.
The charge of conspiracy to commit securities fraud provides for a sentence of no greater than five years in prison, three years of supervised release and a fine of $250,000 or twice the gain or loss to the victim. The charge of securities fraud and wire fraud provides for a sentence of no greater than 20 years in prison, three years of supervised release and a fine of $250,000 or twice the gain or loss. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz and Harold H. Shaw, Special Agent in Chargeof the Federal Bureau of Investigation, Boston Field Division, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Vassili Thomadakis and SEC attorneys Andrew Palid and Eric Forni, who were appointed as Special Assistant U.S. Attorneys.
The details contained in the charging document are allegations. Hand is presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
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