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by Mike Caswell

The U.S. Securities and Exchange Commission has filed civil fraud charges against Georgios Palikaras and John Brda for the manipulation of Torchlight Energy Resources Inc., an oil and gas company that went to a $10.88 high in 2021. (All figures are in U.S. dollars.) The SEC claims that the men engineered a scheme to boost the stock by forcing short-sellers to cover their positions. They then took advantage of the resulting price gains to raise $137.5-million, the SEC says.

The allegations are contained in a complaint that the SEC filed on Tuesday, June 25, in federal court in New York. The complaint identifies Mr. Palikaras as a resident of Halifax who served as the president of a company that acquired Torchlight. The complaint lists Mr. Brda as a St. Louis resident who was the chief executive officer of Torchlight.

The events at issue go back to early 2020, when Torchlight had sold its oil and gas assets and only had one undeveloped project remaining. The company was in difficult financial condition, with $25-million in debt and $1-million in assets, the complaint states. The company had also attracted a large number of short-sellers, or those who were betting the stock would fall.

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