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by Mike Caswell

The U.S. Securities and Exchange Commission has secured a $2.6-million civil disgorgement order against Philip Pritchard and Pietro Cimino, two of the defendants in the Vancouver-linked pump-and-dump of Global Development and Environmental Resources Inc. (All figures are in U.S. dollars.) The SEC claimed that the men issued a series of positive news releases, including one in which the company falsely claimed to have $80-million in contracts. The releases came while one of their co-accused, former Vancouver broker Darko Mrakuzic, secretly dumped $6.5-million worth of stock.

The penalties against the men are contained in a judgment entered on April 23, 2012, in Tampa. Both men settled the case in September, 2008, agreeing to pay fines that the judge would determine. Neither admitted any wrongdoing.

In determining the penalties, Judge James Whittemore said the conduct of the pair was "egregious, premeditated, and risked causing substantial losses to investors." Their violations "involved fraud, deceit, and deliberate or reckless disregard of a regulatory requirement," the judge wrote. He held the men jointly liable for $2.1-million in disgorgement, plus $523,000 in interest. On top of that, each must pay a $130,000 civil penalty. The men both previously agreed to permanent penny stock bans as part of their settlements.

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