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by Mike Caswell

The U.S. Securities and Exchange Commission has won a $652,800 judgment against Jacob Canceli, one of several men charged for a $6.2-million pump-and-dump scheme run through the Investors Hub website. (All figures are in U.S. dollars.) The SEC claimed that he and others heavily manipulated four pink sheets listings, including an Ontario company called Playstar Corp. The men dumped millions of unregistered shares which they had obtained for little or nothing, the SEC said.

Mr. Canceli's fine is contained in an order granted on Nov. 16, 2015, by U.S. District Court Judge Gregory Sleet. It includes disgorgement of $267,453 in profits, a $267,453 civil penalty and interest. The judge also permanently banned Mr. Canceli from penny stocks. The order is a decision by default, as Mr. Canceli did not respond to the SEC's case.

For Mr. Canceli, the fine represents his most substantial penalty from the scheme, as a prior criminal case did not result in any jail time. On Jan. 5, 2011, he pleaded guilty to federal fraud charges in Delaware that arose from the same conduct. Although sentencing guidelines specified five years in jail (out of a 20-year maximum), prosecutors only sought three years of probation. The reason for the light sentence is not entirely clear, as the documents that would normally provide the details of his sentence are sealed or redacted. (Reports on a website called The Aging Rebel state that Mr. Canceli is in the witness protection program.)

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