LOS ANGELES – Federal criminal charges were filed today against an analyst for a newsletter promoting unregistered securities and over-the-counter stocks, his money-laundering associate, and the CEO of a Beverly Hills company, all of whom participated in a bribery scheme in which leaders of various companies paid more than $4.2 million in undisclosed compensation to have their stocks touted by the newsletter.
The following defendants have been charged:
- Jonathan William Mikula, 38, of Woodstock, Georgia; who worked as a stock analyst and writer for an investment newsletter;
- Christian Fernandez, 33, a.k.a. “Christian Crockwell,” of Smyrna, Georgia, who was a business associate and friend of Mikula’s; and
- Amit Raj Beri, 47, of Hobe Sound, Florida, who was the CEO of a Beverly Hills-based business.
All three defendants have been charged via information with one count of conspiracy to tout securities for undisclosed compensation. Mikula also has been charged with one count of touting securities for undisclosed compensation.
According to an information filed January 30 in United States District Court, Mikula worked as an analyst for “Palm Beach Venture,” an investment newsletter with subscribers nationwide. This newsletter published promotional pieces for offerings of securities, including unregistered securities marketed pursuant to the U.S. Securities and Exchange Commission’s Regulation A, as well as microcap stocks traded “over the counter.” There, securities are lower-priced, illiquid securities traded not on liquid public exchanges but instead through securities dealers known as “market makers.”
Federal law requires full and public disclosure from anyone who has received payment – directly or indirectly – from an issuer for publishing, publicizing, or circulating any advertisement or communication that describes the issuer’s security offered for sale.
From December 2019 to August 2022, in exchange for Mikula touting certain securities issuances through “Palm Beach Venture,” Beri and others provided Mikula and Fernandez with both cash payments as well as undisclosed, indirect compensation, including lavish meals, beverages, and other illicit entertainment.
Fernandez opened and operated foreign and shell companies and bank accounts – some based in Mexico – whose purpose was to conceal the nature of the bribes and kickbacks. In exchange, Fernandez took a hefty cut – sometimes half – of the funds.
The conspiracy allowed some of its participants to raise tens of millions of dollars in investor funds through securities offerings described and promoted by “Palm Beach Venture” without required disclosures that such promotions had been obtained via direct and indirect payments to Mikula.
For example, in March 2020, Mikula caused to be published an article in “Palm Beach Venture” entitled, “Curing Incurable Diseases and Giving Us Over 4,900% Potential Gains.” The article touted Emerald Health Pharmaceuticals (EHP), a San Diego-based life sciences company and falsely stated that neither the newsletter nor its affiliates had received compensation and that “as publishers of financial information, we make general recommendations based on our own analysis.” In fact, negotiations were underway between EHP, Beri, Mikula, and Fernandez toward concealed payments in exchange for the article.
In total, Mikula, Fernandez, Beri and others received more than $4.2 million in undisclosed and misrepresented payments as well as hundreds of thousands of dollars of compensation in the form of undisclosed entertainment and illicit services.
Another co-conspirator, Avtar Singh Dhillon, 62, of Long Beach, a one-time board member of and an indirect shareholder in EHP, pleaded guilty in December 2022 in United States District Court for the District of Massachusetts and admitted his role in the conspiracy. His sentencing hearing is scheduled for May 23 in Boston.
The conspiracy charge carries a statutory maximum sentence of five years in federal prison. The securities touting charge also carries a statutory maximum sentence of five years in federal prison.
The FBI is investigating this matter.
The United States Securities and Exchange Commission has also charged the defendants in a separate civil enforcement action.
Any investors who believe they are a victim of the crimes alleged in this Information are encouraged to go to https://www.justice.gov/usao-cdca/united-states-v-jonathan-william-mikula-christian-fernandez-and-amit-raj-beri for further information and updates regarding this matter.
An information contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.
Assistant United States Attorney Adam P. Schleifer of the Corporate and Securities Fraud Strike Force is prosecuting this case.