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by Mike Caswell
A U.S. federal judge in Boston has ordered former Toronto broker Morrie Tobin to forfeit $4-million for his part in a $3.6-million market manipulation. (All figures are in U.S. dollars.) Prosecutors said that Mr. Tobin was part of a scheme to boost two OTC Markets listings with paid promotional campaigns while secretly selling hundreds of thousands of shares. He and others carried out a "massive dump of shares," with the scheme including since-arrested U.K. citizen Roger "Rocket" Knox.
The $4-million forfeiture for Mr. Tobin is contained in an order handed down in Boston on Wednesday, June 5. It comes six months after Mr. Tobin agreed to plead guilty to charges stemming from the scheme. He must pay the money before his sentencing, which he previously indicated he was prepared to do using assets in Canada.
The payment by Mr. Tobin will be in addition to any jail time that he receives for the scheme. The charges to which he pleaded guilty are one count of securities fraud and one count of conspiracy to commit securities fraud, with the securities fraud charge carrying a maximum term of 20 years. It is very unlikely that he will receive a sentence anywhere near that length, however, as prosecutors have agreed to recommend a term at the lower end of what would be appropriate.
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