News and Press Releases

Houston Businessman Sentenced to Federal Prison for Fraud

   
May 22, 2012

300+ victims submit statements to the court

HOUSTON – A Houston businessman has been sentenced for conspiring to commit wire fraud, United States Attorney Kenneth Magidson announced today. James Roland Dial, 56, of Houston, just landed a five-year-term of imprisonment at a hearing that concluded moments ago in Houston. 

Dial pleaded guilty to the offense on March 4, 2011, admitting he conspired with Evan “Nick” Jarvis, 39, of Magnolia, Texas, and Alex Ellerman, 36, of Chicago, to enrich themselves between 2004 and 2007 by artificially inflating the stock price of a publicly-traded company called Grifco International Inc. (Grifco). Grifco manufactured oil field drilling equipment and Dial was Grifco’s CEO. Dial admitted knowing that Grifco issued a press release to the public on March 3, 2005, containing false information about Grifco’s revenue and net income and that he willfully and knowingly profited from the false press release by selling Grifco stock to the public at an inflated price. The stock ultimately became worthless.

Approximately 300 investors who had purchased Grifco stock submitted impact statements to the court for consideration at Dial’s sentencing today. Several victims noted they had lost their life savings because of the fraud. Senior U.S. District Judge David Hittner, who accepted the guilty plea and presided over the hearing today, handed Dial a five-year prison sentence to be followed by three years of supervised release. Judge Hittner also ordered Dial to pay restitution to his victims. A hearing to determine the amount of such restitution will be held within the next 90 days. 

Jarvis and Ellerman pleaded guilty to conspiring with Dial and will be sentenced on June 1, 2012. Jarvis had been permitted to remain on bond pending his sentencing hearing, but was taken into custody on May 3, 2012, for violating conditions of his bond where he will now remain. Ellerman has been in custody since April 20, 2010, when he was arrested at George Bush Intercontinental Airport upon returning to the United States after a lengthy stay in Panama.

The two-year investigation leading to the charges was conducted by the FBI with the assistance of the Harris County District Attorney’s Office. The U.S. Securities & Exchange Commission has conducted a parallel investigation. Assistant U.S. Attorney John R. Lewis is prosecuting the case.

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