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by Mike Caswell

The U.S. Securities and Exchange Commission has filed a motion seeking $50.3-million in penalties against David Gordon, an Oklahoma lawyer jailed for his part in a 2005 market manipulation. (All figures are in U.S. dollars.) The regulator says there is no genuine dispute that Mr. Gordon participated in a scheme in which he and others pumped and dumped three companies. A jury in Oklahoma convicted him of parallel criminal charges on May 3, 2010.

The SEC's request comes nine months after a U.S. federal judge sentenced Mr. Gordon to 15 years in jail on charges that stemmed from the three pump-and-dumps. Prosecutors argued that he and others, including fugitive Canadian promoter Dean Sheptycki, participated in a market manipulation that defrauded investors of millions. The stocks they promoted included one company they held out as a storm reconstruction outfit in the wake of hurricane Katrina, the storm that devastated New Orleans in 2005.

Mr. Gordon unsuccessfully fought the criminal charges, arguing that there was no proof he was responsible for boosting the stocks. He sought a light sentence on the grounds that he had already suffered the loss of his profession and would be banned from penny stocks. He still maintains his innocence, and is appealing his conviction.

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