United States v. Michael Affa, et al., No. 1:14-cr-10221 (D. Mass.)
Massachusetts Federal Court Sentences Three Defendants in SEC Microcap Manipulation Case
U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 23743 / February 7, 2017
Securities and Exchange Commission v. Michael Affa, et al., No. 14-cv-12959 (D. Mass. filed July 11, 2014)
United States v. Michael Affa, et al., No. 1:14-cr-10221 (D. Mass.)
Massachusetts Federal Court Sentences Three Defendants in SEC Microcap Manipulation Case
The Securities and Exchange Commission announced that the final three defendants in a microcap manipulation case were sentenced. On February 2, 2017, a federal court in Boston, Massachusetts sentenced Andrew Affa, of Huntington Station, New York, to one day in prison (time already served), three years of supervised release with 12 months to be served in home confinement, and ordered him to pay a fine of $100,000. On December 12, 2016, the court sentenced Christopher Putnam, of Charleston, South Carolina, to one year and one day in prison and 24 months of supervised release and ordered him to pay a fine of $50,000. On October 19, 2016, the court sentenced Christopher Nix, of Hilton Head, South Carolina, to 18 months in prison and 36 months of supervised release and ordered him to pay a fine of $100,000. Affa, Putnam and Nix pleaded guilty in September 2015 to criminal charges of conspiracy, securities fraud and wire fraud for their participation with two other defendants in a pump-and-dump scheme in the securities of Boston-based Amogear Inc.
The criminal case was announced the same day as the SEC filed fraud charges against Affa, Nix, Putnam, and the other two defendants for attempting to manipulate shares of Amogear that was caught by an FBI undercover operation. According to the SEC's complaint filed in federal court in Boston, the defendants knew that Amogear was a shell company without any real operations but schemed to boost its price and profit by selling their own shares. What the defendants did not know was that the FBI controlled Amogear and used it to obtain evidence of attempted stock manipulation. To protect investors, on February 10, 2014, the SEC suspended trading in Amogear's securities as the attempted stock manipulation was underway.
In March 2016, the federal court in the SEC's case entered judgments by consent against all five defendants, enjoining them from violating Section 17(a)(1) and (3) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5(a) and (c) thereunder, and prohibiting them from participating in any offering of penny stock, pursuant to Section 21(d)(6) of the Exchange Act.
Mitchell Brown and Michael Affa, the two co-defendants of Andrew Affa, Putnam, and Nix, also were sentenced, respectively, in June 2016 to 42 months in prison and 3 years of supervised release (for two separate criminal cases), and in February 2016 to 33 months in prison. Both were also ordered to pay a fine of $1 million and Brown was ordered to pay restitution of $420,643.
For further information, see Litigation Release Nos. 23576 (June 21, 2016); 23495 (Mar. 23, 2016); 23469 (Feb. 17, 2016); Press Release No. 2014-135 (July 11, 2014); and Exchange Act Release No. 71514 (Feb. 10, 2014).
CRIMINAL DOCKET FOR CASE #: 1:14-cr-10221-WGY All Defendants Case title: USA v. Affa et al
1:14-cr-10221-WGY USA v. Affa et al - 1:14-cr-10221-WGY-1 Michael Affa (closed 02/19/2016) 1:14-cr-10221-WGY-2 Andrew Affa 1:14-cr-10221-WGY-3 Mitchell Brown (closed 06/22/2016) 1:14-cr-10221-WGY-4 Christopher Putnam (closed 12/23/2016) 1:14-cr-10221-WGY-5 Christopher Nix (closed 10/24/2016)
Date Filed # Docket Text
02/07/2017 243 Assented to MOTION to Extend Self-Report Date as to Christopher Putnam. (Hanye, Joshua) (Entered: 02/07/2017)
02/02/2017 242 Electronic Clerk's Notes for proceedings held before Judge William G. Young: Sentencing held on 2/2/2017 for Andrew Affa (2), Count(s) 1, 2, 3-7. The Court announces highest sentence under constitution, average sentences and guideline calculations. After hearing from the government, defense counsel and the defendant, the Court imposes the following sentence: The defendant is sentenced to time served on each count, each count to run concurrently with each other to be followed by three (3) years of supervised release with standard and special conditions, including the fir 12 months to be spent in home confinement with electronic monitoring; $100,000 fine; $700 special assessment. The defendant is notified of the right to appeal. Should an appeal be contemplated, the Court ORDERS the parties to move for the production of the necessary transcript, PRIOR to the filing of the notice of appeal. (Attorneys present: Ausa Forni and Palid, Losquadro for the defendant. )Court Reporter Name and Contact or digital recording information: Richard Romanow at bulldog@richromanow.com. (Gaudet, Jennifer) (Entered: 02/07/2017)
01/17/2017 234 Judge William G. Young: ELECTRONIC ORDER entered granting 233 Assented to Motion to Continue as to Andrew Affa (2). Sentencing reset for 2/2/2017 02:00 PM in Courtroom 18 before Judge William G. Young. (Gaudet, Jennifer) (Entered: 01/17/2017)
01/17/2017 233 Assented to MOTION to Continue Sentencing as to Andrew Affa by USA. (Forni, Eric) (Entered: 01/17/2017)
01/12/2017 232 Judge William G. Young: ORDER entered granting 231 MOTION to Release Bond Obligation as to Christopher Putnam and as to Christopher Nix. (Paine, Matthew) (Entered: 01/12/2017)
01/10/2017 231 MOTION to Release Bond Obligation as to Christopher Putnam and as to Christopher Nix. (Attachments: # 1 Exhibit A)(Kotlier, Jonathan) (Entered: 01/10/2017)
12/23/2016 230 Judge William G. Young: ORDER entered. STATEMENT OF REASONS as to Christopher Putnam. (Gaudet, Jennifer) (Entered: 12/29/2016)
12/23/2016 229 Judge William G. Young: ORDER entered. JUDGMENT as to Christopher Putnam (4), Count(s) 1, 2, 3-7, The defendant is committed to custody of the Bureau of Prisons for one year and one day on each count, each count to run concurrently one with the other to be followed by 24 months of supervised release with standard and special conditions. $50,000 fine. $700 special assessment. (Attachments: # 1 Transcript Excerpt of Sentencing Hearing) (Gaudet, Jennifer) (Entered: 12/29/2016)
12/12/2016 228 Electronic Clerk's Notes for proceedings held before Judge William G. Young: Sentencing held on 12/12/2016 for Christopher Putnam (4), Count(s) 1, 2, 3-7. The Court allows the government's motion and announces the top of the applicable guideline, average sentences and guideline calculations. After hearing from the government, defense counsel and the defendant the Court imposes the following sentence: The defendant is committed to custody of the Bureau of Prisons for one year and one day on each count, each count to run concurrently one with the other to be followed by 24 months of supervised release with standard and special conditions. $50,000 fine. $700 special assessment. The defendant is notified of the right to appeal. Should an appeal be contemplated, the Court ORDERS the parties to move for the production of the necessary transcript, PRIOR to the filing of the notice of appeal. Defendant is Ordered to self surrender to the place of confinement on February 20, 2017 and released on conditions previously set. The Court makes a Judicial Recommendation that the defendant be designated to FCI Estill in South Carolina. (Attorneys present: Ausa Forni and Palin, Defense counsel Hanye, US Probation Officer Roffo. )Court Reporter Name and Contact or digital recording information: Richard Romanow at bulldog@richromanow.com. (Gaudet, Jennifer) (Entered: 12/13/2016)
12/08/2016 224 Set/Reset Hearings as to Christopher Putnam. Sentencing set for 12/12/2016 02:00 PM in Courtroom 8 before Judge William G. Young. LOCATION CHANGE ONLY. (Gaudet, Jennifer) (Entered: 12/08/2016)
11/22/2016 223 Set/Reset Hearings as to Andrew Affa. Sentencing reset for 1/26/2017 02:00 PM in Courtroom 18 before Judge William G. Young. (Gaudet, Jennifer) (Entered: 11/22/2016)
11/04/2016 220 Set/Reset Hearings as to Christopher Putnam. Sentencing reset for 12/12/2016 02:00 PM in Courtroom 18 before Judge William G. Young. (Gaudet, Jennifer) (Entered: 11/04/2016)
10/28/2016 214 Judge William G. Young: ORDER entered. AMENDED JUDGMENT as to Christopher Nix (5), Count(s) 1, 2, 3-7, The defendant is committed to the custody of Bureau of Prisons for 18 months on each count, each count to run concurrently one with the other; 36 months of supervised release; $100,000 fine. JUDGMENT AMENDED TO CORRECT JUDICIAL RECOMMENDATION TO BOP. (Gaudet, Jennifer) (Entered: 10/31/2016)
10/24/2016 213 Judge William G. Young: ORDER entered. STATEMENT OF REASONS as to Christopher Nix. (Gaudet, Jennifer) (Entered: 10/25/2016)
10/24/2016 212 Judge William G. Young: ORDER entered. JUDGMENT as to Christopher Nix (5), Count(s) 1, 2, 3-7, The defendant is committed to the custody of Bureau of Prisons for 18 months on each count, each count to run concurrently one with the other; 36 months of supervised release; $100,000 fine. (Attachments: # 1 transcript excerpt of sentencing) (Gaudet, Jennifer) (Entered: 10/25/2016)
10/20/2016 210 Set/Reset Hearings as to Christopher Putnam. Sentencing reset for 11/9/2016 02:30 PM in Courtroom 18 before Judge William G. Young. (Gaudet, Jennifer) (Entered: 10/20/2016)
10/19/2016 211 Electronic Clerk's Notes for proceedings held before Judge William G. Young: Sentencing held on 10/19/2016 for Christopher Nix (5), Count(s) 1, 2, 3-7. The Court calculates highest sentence, average sentences and guideline calculations. After hearing from the government, defense counsel and the defendant, the Court imposes the following sentence: The defendant is committed to the custody of Bureau of Prisons for 18 months on each count, each count to run concurrently one with the other; 36 months of supervised release with standard and special conditions; $100,000 fine. The Court makes a judicial recommendation that the defendant be designated to FCI Estill in South Carolina. The defendant is notified of the right to appeal. Should an appeal be contemplated, the Court ORDERS the parties to move for the production of the necessary transcript, PRIOR to the filing of the notice of appeal. The defendant is released on the same conditions previously set and shall self report to the place of confinement on January 4, 2017. (Attorneys present: Palid and Forni for the government, Kotlier for the defendant.)Court Reporter Name and Contact or digital recording information: Richard Romanow at bulldog@richromanow.com. (Gaudet, Jennifer) (Entered: 10/20/2016)
10/18/2016 207 ELECTRONIC NOTICE OF RESCHEDULING as to Christopher Nix. Sentencing set for 10/19/2016 02:30 PM in Courtroom 18 before Judge William G. Young. Time Change Only. (Gaudet, Jennifer) (Entered: 10/18/2016)
10/18/2016 206 Set/Reset Hearings as to Andrew Affa. Sentencing set for 12/9/2016 02:00 PM in Courtroom 18 before Judge William G. Young. (Gaudet, Jennifer) (Entered: 10/18/2016)
10/17/2016 202 Judge William G. Young: ELECTRONIC ORDER entered granting 200 MOTION for Leave to File Sentencing Memorandum Under Seal. (Paine, Matthew) (Entered: 10/17/2016)
10/14/2016 200 MOTION for Leave to File Sentencing Memorandum Under Seal as to Christopher Nix. (Kotlier, Jonathan) (Entered: 10/14/2016)
10/13/2016 199 SENTENCING MEMORANDUM by USA as to Christopher Nix (Palid, Andrew)(FILED UNDER SEAL) (Paine, Matthew). (Entered: 10/13/2016)
09/09/2016 198 Judge William G. Young: ELECTRONIC ORDER entered granting 197 Motion to Continue as to Christopher Putnam (4). Sentencing reset for 10/25/2016 02:00 PM in Courtroom 18 before Judge William G. Young. (Gaudet, Jennifer) (Entered: 09/09/2016)
09/08/2016 197 Assented to MOTION to Continue Sentencing as to Christopher Putnam. (Hanye, Joshua) (Entered: 09/08/2016)
08/04/2016 196 NOTICE is hereby given that an official transcript of a proceeding has been filed by the court reporter in the above-captioned matter. Counsel are referred to the Court's Transcript Redaction Policy, available on the court website at http://www.mad.uscourts.gov/attorneys/general-info.htm (Scalfani, Deborah) (Entered: 08/04/2016)
08/04/2016 195 Transcript of Sentencing as to Mitchell Brown held on June 20, 2016, before Judge William G. Young. Court Reporter Name and Contact Information: Richard Romanow at bulldog@richromanow.com The Transcript may be purchased through the Court Reporter, viewed at the public terminal, or viewed through PACER after it is released. Redaction Request due 8/25/2016. Redacted Transcript Deadline set for 9/5/2016. Release of Transcript Restriction set for 11/2/2016. (Scalfani, Deborah) (Entered: 08/04/2016)
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
Date Filed: 07/23/2014 Assigned to: Judge William G. Young
Defendant (1) Michael Affa TERMINATED: 02/19/2016 also known as Michael A. Affa TERMINATED: 02/19/2016 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) The defendant is sentenced to 33 months in custody of Bureau of Prisons on each count, each count to run concurrently with each other, to be followed by 36 months of supervised release with standard and special conditions. $700 special assessment. $1,000,000 fine. 15:78j(b), 78(ff); 17 C.F.R. SEC. 240.10b5; AND 18:2...SECURITIES FRAUD (2) The defendant is sentenced to 33 months in custody of Bureau of Prisons on each count, each count to run concurrently with each other, to be followed by 36 months of supervised release with standard and special conditions. $700 special assessment. $1,000,000 fine. 18:1343, 1349, AND 2...WIRE FRAUD (3-7) The defendant is sentenced to 33 months in custody of Bureau of Prisons on each count, each count to run concurrently with each other, to be followed by 36 months of supervised release with standard and special conditions. $700 special assessment. $1,000,000 fine.
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) The defendant is sentenced to time served on each count, each count to run concurrently with each other to be followed by three (3) years of supervised release with standard and special conditions; $100,000 fine; $700 special assessment. 15:78j(b), 78(ff); 17 C.F.R. SEC. 240.10b5; AND 18:2...SECURITIES FRAUD (2) The defendant is sentenced to time served on each count, each count to run concurrently with each other to be followed by three (3) years of supervised release with standard and special conditions; $100,000 fine; $700 special assessment. 18:1343, 1349, AND 2...WIRE FRAUD (3-7) The defendant is sentenced to time served on each count, each count to run concurrently with each other to be followed by three (3) years of supervised release with standard and special conditions; $100,000 fine; $700 special assessment.
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 TERMINATED: 06/22/2016 also known as Mitchell H. Brown TERMINATED: 06/22/2016 represented by Richard Roth The Roth Law Firm, PLLC 295 Madison Avenue Floor 22 New York, NY 10017 (212) 542-8882 Fax: (212) 542-8883 Email: rich@rrothlaw.com 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 TERMINATED: 06/01/2015 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) The defendant is committed to the custody of BOP for 42 months on each count, each count to run concurrently with each other and with term imposed in case 15-cr-10297-WGY. Three years of supervised release with standard and special conditions. $900 total special assessment (combined with 15-cr-10297). $1 Million fine. 15:78j(b), 78(ff); 17 C.F.R. SEC. 240.10b5; AND 18:2...SECURITIES FRAUD (2) The defendant is committed to the custody of BOP for 42 months on each count, each count to run concurrently with each other and with term imposed in case 15-cr-10297-WGY. Three years of supervised release with standard and special conditions. $900 total special assessment (combined with 15-cr-10297). $1 Million fine. 18:1343, 1349, AND 2...WIRE FRAUD (3-7) The defendant is committed to the custody of BOP for 42 months on each count, each count to run concurrently with each other and with term imposed in case 15-cr-10297-WGY. Three years of supervised release with standard and special conditions. $900 total special assessment (combined with 15-cr-10297). $1 Million fine.
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 TERMINATED: 12/23/2016 also known as Christopher R. Putnam TERMINATED: 12/23/2016 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) The defendant is committed to custody of the Bureau of Prisons for one year and one day on each count, each count to run concurrently one with the other to be followed by 24 months of supervised release with standard and special conditions. $50,000 fine. $700 special assessment. 15:78j(b), 78(ff); 17 C.F.R. SEC. 240.10b5; AND 18:2...SECURITIES FRAUD (2) The defendant is committed to custody of the Bureau of Prisons for one year and one day on each count, each count to run concurrently one with the other to be followed by 24 months of supervised release with standard and special conditions. $50,000 fine. $700 special assessment. 18:1343, 1349, AND 2...WIRE FRAUD (3-7) The defendant is committed to custody of the Bureau of Prisons for one year and one day on each count, each count to run concurrently one with the other to be followed by 24 months of supervised release with standard and special conditions. $50,000 fine. $700 special assessment.
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 TERMINATED: 10/24/2016 also known as Gabe Nix TERMINATED: 10/24/2016 also known as Christopher G. Nix TERMINATED: 10/24/2016 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
Andrew R. McArdell Nutter, McClennen & Fish, LLP Seaport West 155 Seaport Boulevard Boston, MA 02210-2604 617-439-2339 Email: amcardell@nutter.com ATTORNEY TO BE NOTICED Designation: Retained
Pending Counts Disposition 18:371...CONSPIRACY TO COMMIT SECURITIES FRAUD AND WIRE FRAUD (1) The defendant is committed to the custody of Bureau of Prisons for 18 months on each count, each count to run concurrently one with the other; 36 months of supervised release; $100,000 fine. 15:78j(b), 78(ff); 17 C.F.R. SEC. 240.10b5; AND 18:2...SECURITIES FRAUD (2) The defendant is committed to the custody of Bureau of Prisons for 18 months on each count, each count to run concurrently one with the other; 36 months of supervised release; $100,000 fine. 18:1343, 1349, AND 2...WIRE FRAUD (3-7) The defendant is committed to the custody of Bureau of Prisons for 18 months on each count, each count to run concurrently one with the other; 36 months of supervised release; $100,000 fine.
Plaintiff USA represented by Eric A. Forni Securities and Exchange Commission - MA 33 Arch Street 23rd Floor Boston, MA 02110-1424 617-573-8827 Email: fornie@sec.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 617-748-3105 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
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