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by Mike Caswell
The U.S. Securities and Exchange Commission has asked a New York judge to impose $1.25-million in sanctions against Christopher McKnight, a Vancouver man who participated in a $35-million scheme to facilitate multiple pump-and-dumps. (All figures are in U.S. dollars.) The SEC says that Mr. McKnight ran paid promotions for several penny stocks over a six-month period. He was part of a network that provided insiders a "layer of disguise," allowing them to secretly sell shares of 45 companies, the SEC claims.
The proposed penalties for Mr. McKnight, 48, are contained in a motion that the SEC filed on Wednesday, Nov. 9, in federal court in New York. The $1.25-million includes disgorgement of $985,303 in gains, plus interest, and a $100,000 fine. There was no trial for Mr. McKnight, as he previously agreed to settle the case out of court, with the judge to determine his penalties. In reaching the deal, he did not admit to any wrongdoing.
Mr. McKnight's part in the scheme, as set out by the SEC, involved serving as an intermediary between insiders and paid promoters. According to the SEC, he provided layers of anonymity that allowed control groups to pay for promotional campaigns while hiding their involvement. Mr. McKnight co-ordinated the budgets and payments for promotions, the SEC says.
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