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by Mike Caswell

Over 10 years after being charged, B.C. resident Colin Heatherington has agreed to plead guilty to criminal fraud charges in California arising from a market manipulation scheme that inflicted $200-million in losses on investors. (All figures are in U.S. dollars.) Prosecutors claimed that Mr. Heatherington and others stuffed hedge funds with as much as $440-million worth of penny stocks that they had manipulated. Mr. Heatherington and his associates sold those same companies, using the proceeds to buy luxury cars, expensive homes and a yacht, prosecutors said.

Mr. Heatherington's guilty plea is set out in an agreement filed on Monday, Jan. 8, in federal court in Los Angeles. He has agreed to plead guilty to one count of conspiracy to commit securities fraud and wire fraud. He has also agreed that he will not commit any future crimes, will appear in court as ordered and will not contest any criminal debt ordered by the court.

The plea agreement says little about Mr. Heatherington's jail term, with that being left for the judge to determine at a later date. The maximum possible sentence is 25 years, but Mr. Heatherington is unlikely to receive anything close to that. Based in part on Mr. Heatherington's sentencing guidelines calculation (a complex piece of math designed to approximate an offender's jail term), prosecutors have agreed that they will not appeal a sentence greater than six years.

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