Florida Man Sentenced to 7 Years in Prison for Role in Stock "Pump and Dump" Scheme
John H. Durham, United States Attorney for the District of Connecticut, announced that WILLIAM LIEBERMAN, 42, of Boca Raton, Florida, was sentenced today by U.S. District Judge Jeffrey A. Meyer in New Haven to 84 months of imprisonment, followed by three years of supervised release, for his role in a securities fraud scheme.
According to court documents and statements made in court, between approximately 2010 and July 2016, LIEBERMAN conspired with others, including Christian Meissenn of Connecticut, to defraud investors through a stock “pump and dump” scheme. LIEBERMAN and his co-conspirators induced investors to purchase securities by making false and misleading representations in calls, emails and press releases concerning the securities and the issuing companies, thereby causing the price of those securities to become falsely inflated. The issuing companies included Terra Energy Resources Ltd. (stock symbol “TRRE”); Mammoth Energy Group, Inc. (stock symbol “MMTE”), a company that later became Strategic Asset Leasing Inc. (stock symbol “LEAS”); Trilliant Exploration Corporation (stock symbol “TTXP”); Hermes Jets, Inc. (stock symbol “HRMJ”), which later became Continental Beverage Brands Corporation (stock symbol “CBBB”); Dolat Ventures, Inc. (stock symbol “DOLV”), and Fox Petroleum, Inc. (stock symbol “FXPT”).
At various times, LIEBERMAN served as the Chief Executive Officer, Chairman of the Board, President, Secretary, and Treasurer of Mammoth Energy Group, Inc.; the President, Chief Executive officer, and Chairman of the Board of Strategic Asset Leasing Inc.; the President, Chief Accounting Officer, Chief Executive Officer, Chief Financial Officer, Secretary, and Treasurer of Fox Petroleum, Inc.; and the Chief Executive Officer, President, Treasurer, Secretary, and Chief Financial Officer of Trilliant Exploration Corporation. In his capacity as an officer of certain of these issuing companies, LIEBERMAN, working with others, issued false and misleading press releases concerning the financial health and prospects of the companies. He also was aware that co-conspirators were making false and misleading statements to promote the sale of these securities.
As part of the scheme, LIEBERMAN arranged for attorneys, including Corey Brinson of Connecticut and Diane Dalmy of Colorado, to sign false and misleading opinion letters that were designed to provide assurances to securities transfer agents and prospective investors. At times, he affixed attorneys’ signatures to the opinion letters. The opinion letters falsely certified that the attorneys had adequately reviewed corporate records and filings for the issuing companies and were satisfied with the adequacy of the companies’ public disclosures.
LIEBERMAN and his co-conspirators also conducted matched or coordinated trades of securities amongst themselves or in large blocks at predetermined prices, in order to artificially boost the trading volume of the securities, create the appearance of liquidity, and falsely drive up the share price.
After selling their own shares at a profit, the conspirators allowed the price of the securities to fall, leaving investors with worthless and unsalable stock. As a result, more than 12,000 victim investors collectively lost nearly $19 million.
Between 2011 and 2015, LIEBERMAN earned nearly $1.2 million through this scheme. He failed to report this income to the Internal Revenue Service, evading $436,235 in federal income taxes for the 2011 through 2015 tax years.
On May 10, 2017, LIEBERMAN pleaded guilty to one count of conspiracy to commit mail and wire fraud, and one count of tax evasion.
Judge Meyer ordered LIEBERMAN to pay $5,301,694 in restitution to the victims of the fraud scheme, and $436,235 to the IRS.
LIEBERMAN, who is released on bond, was ordered to report to prison on August 13.
Meissenn, Brinson, Dalmy and three other individuals also pleaded guilty to various offenses stemming from this scheme. Brinson, of Hartford, and Dalmy, of Denver, were each sentenced to 36 months of imprisonment on April 13, 2017, and May 15, 2018, respectively. On September 27, 2017, Damian Delgado, also known as “Michael Neumann,” of Orlando, Florida, was sentenced to 84 months of imprisonment. On May 7, 2018, Brian Ferraioli, of Sayville, N.Y., and Thomas Heaphy, Jr., of East Moriches, N.Y., were each sentenced to 72 months of imprisonment for their roles in this scheme and an unrelated investment fraud scheme. Meissenn awaits sentencing.
This investigation is being conducted by the Federal Bureau of Investigation and Internal Revenue Service – Criminal Investigation Division, with assistance from the Connecticut Department of Banking and the Hartford and Stamford Police Departments. The case is being prosecuted by Assistant U.S. Attorney Avi M. Perry.