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by Mike Caswell

William Stack, a Texas lawyer facing up to $761,293 in penalties for a scheme on the OTC markets with a supposed Arizona gold mine, has asked that the judge not impose any fines on him. (All figures are in U.S. dollars.) He says that he was set up to "take the fall" by William Scott Marshall, a former Vancouverite who faced related charges. He claims to have had no knowledge of a scheme in which Mr. Marshall solicited investors through a phone room, touting the mine as a $273-million operation.

The statements from Mr. Stack come as the U.S. Securities and Exchange Commission is seeking to fine and ban him. The SEC claims that he served as the chief executive officer of the company at the centre of the scheme, Preston Corp., at Mr. Marshall's behest. He then helped raise money from investors, misappropriating some for himself while sending the remainder to Mr. Marshall, according to the SEC.

There was no trial for Mr. Stack, as he previously settled the case out of court, agreeing (without admitting any wrongdoing) to pay sanctions that the judge will determine. To that end, the SEC asked that the judge order him to pay fines, disgorgement and interest totalling $761,293. It also asked that the judge impose a permanent penny stock ban and a permanent officer and director ban.

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