Yes, some of Shawn Becker’s piscine associates were pumping and dumping shares of Chinese companies they helped gain entrée to the U.S. And yes, Shawn Becker was hired to pump said stocks. But he was just a patsy, a small fry, and should have been thrown back, the people he hired to make his case say.
U.S. regulators Monday filed a civil lawsuit against a Toronto consultant and four other people for allegedly helping two Chinese companies enter U.S. markets and making millions of dollars in profit by manipulating trading of the companies’ shares….
Lawyers for Mr. Kelley and a second defendant who settled, Robert S. Agriogianis of Florham Park, N.J., declined to comment. Steve Feder, a lawyer for another defendant, George Tazbaz of Oakville, Ontario, said Mr. Tazbaz “denies any wrongdoing, and he hopes to be fully vindicated.” Arthur Fillmore II, a lawyer for defendant Shawn A. Becker of Overland Park, Kan., said his client “got caught in a net that trapped one too many fish.” A lawyer for the fifth defendant, Roger D. Lockhart of Holiday Island, Ark., couldn’t be reached for comment. Mr. Lockhart settled by agreeing to pay more than $3.1 million….
Mr. Kelley and the others then executed reverse mergers—transactions in which a foreign company merges with a U.S. shell company to gain the shell’s public listing—between the two Chinese companies and shells that Mr. Kelley and his associates controlled, the SEC alleged.
After that, Mr. Kelley and his associates hired Mr. Becker, a stock promoter, to tout the stocks of China Auto and Guanwei Recycling, according to the SEC. They manipulated the trading of the stocks in a variety of ways, such as bidding up their prices and engaging in coordinated trading among themselves, and they dumped their shares at the higher prices, the SEC alleged.
SEC Sues Consultant, Others for Alleged Stock Manipulation [WSJ]