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You may have lost money in your investment portfolio,
due to mismanagement and not even know it.

Duo faces criminal charges for stock manipulation plan

While headlines about the stock market may focus on the precipitous drop in Volkswagen stock, there are other stocks that serve as reminders that unwitting investors could be defrauded by unscrupulous brokers and management companies alike. According to a recent SEC press release, two men face criminal charges for intentionally defrauding investors who backed a company that ostensibly provided stem cell therapy.

According to criminal complaints filed in federal court, the two men concealed their ownership in the company while secretly controlling the company’s operations, and even hired stock promoters to tout the company as a growing enterprise with great potential. The men are also accused of disseminating false information about business developments.

As trading for the company’s stock increased, the value of the stock also increased. This led the men to sell the stock suddenly, which caused them to walk away with more than $1 million.

In addition to criminal charges, the men will have to answer to the defrauded investors who were led to believe the truth of the disclosures provided. As we have noted in our previous posts, there are a host of remedies available to investors who were affected. If convicted, the men will likely be ordered to pay restitution, and the help of an experienced securities law attorney can help in recovering lost investments.

However, not every fraudulent broker faces criminal charges, but they still can be held accountable for their actions if an investor is harmed. To learn more about your rights and options, contact a lawyer. 

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