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by Mike Caswell

A judge in Florida has imposed a seven-year jail term on James M. Schneider, a lawyer from Boca Raton who participated in several shell schemes. A jury previously convicted Mr. Schneider, 77, on 33 counts of conspiracy, securities fraud, wire fraud and money laundering. His work enabled the Vancouver-linked pump-and-dump of Biozoom Inc., among others.

The sentence for Mr. Schneider, handed down on Friday, Feb. 15, comes just two months after his conviction. During his two-week trial, prosecutors explained how he participated in the fraudulent creation of 20 shell companies, filing false documents with the U.S. Securities and Exchange Commission. Among other things, the filings listed officers who were acting as nominees, while failing to disclose hidden backers. His actions allowed others to secretly sell millions of dollars worth of shares to investors.

Mr. Schneider's sentence comes with one of his co-accused, Canadian Myron Gushlak, still wanted in connection with one of the shells. The government claims that Mr. Gushlak arranged the sale of a shell that became Biozoom, setting up the deal while in prison for a prior fraud. With the help of his girlfriend (who is now in jail), Mr. Gushlak set up the shell with a nominee chief executive officer while hiding the controlling share block that he held. As part of the sale, Mr. Schneider transferred $150,000 to an account in Switzerland, the government said. (All figures are in U.S. dollars.)

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