11:39:55 EDT Fri 29 Mar 2024
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SEC, DOJ charge operators of Moneyline Brokers

2015-07-15 12:50 ET - Street Wire

Also Street Wire (U-*SEC) U S Securities and Exchange Commission
Also Street Wire (U-EVRN) Everock Inc

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by Mike Caswell

The U.S. Securities and Exchange Commission and the Department of Justice have filed charges against a Canadian and several U.S. citizens for a market manipulation and money laundering scheme run from Costa Rica. Prosecutors claim that the group, operating as Moneyline Brokers, generated $6.5-million through a pair of pump-and-dumps. (All figures are in U.S. dollars.) The group allegedly provided brokerage services that allowed customers to sell unregistered shares to the unsuspecting public.

Prosecutors in Virginia unsealed an indictment on Tuesday, July 14, against the group in conjunction with a civil case the SEC filed the same day. The indictment names nine people, including a 47-year-old Canadian living in Costa Rica named Michael Randles. The government claims that he was a supervisor at Moneyline Brokers, which sold stock on behalf of U.S. customers during the two pump-and-dumps.

Also charged Monday was Harold Gallison, a 57-year-old resident of California. Prosecutors claim that Mr. Gallison, a repeat violator, founded Moneyline and directed the scheme. In the 1990s, Mr. Gallison was the president of La Jolla Capital, a controversial San Diego brokerage fined and barred for circumventing penny stock rules. (The firm's dealings included following many dubious listings on the former Vancouver Stock Exchange.) Mr. Gallison was also convicted of securities fraud and received a five-year sentence in 2000.

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