Recidivist Fraudster Pleads Guilty for the Third Time to Securities Fraud, Sent to Jail by Judge
PHILADELPHIA – U.S. Attorney William M. McSwain announced that Howard M. Appel, 57, of Wayne, Pennsylvania, pled guilty today to one count of conspiracy to commit securities fraud. Following his plea of guilty, Appel was ordered detained by U.S. District Judge Paul S. Diamond
“This habitual fraudster manipulated the markets to further his own self-interest,” said U.S. Attorney McSwain. “Today, thanks to the hard work and diligence of the FBI, the Securities and Exchange Commission’s New York Office, and our Office, the defendant’s crimes landed him in jail, which is where he belongs.”
As part of his guilty plea, Appel admitted that after his release from prison following two prior securities-fraud related convictions, he participated in a new securities fraud scheme involving publicly traded companies, including Virtual Piggy, Inc. (ticker symbol “VPIG”), and Red Mountain Resources, Inc. (ticker symbol “RDMP”). Appel acquired title to the shares in the names of nominees in order to hide his ownership block from investors and made between $3,000,000 and $4,000,000 from his scheme by artificially inflating the share price by, among other things, engaging in coordinated buying and selling with co-conspirators. Appel also admitted that he traded on inside information that he obtained as a result of his “consulting” work for the companies, including the status of the companies’ efforts to get listed on NASDAQ.
Sentencing is scheduled for November 26, 2018. Appel faces a maximum sentence of 5 years’ incarceration, a three-year period of supervised release, a fine of $250,000 or twice the gross gain or loss, whichever is greatest, and a $100 special assessment.
The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Michael S. Lowe. The parallel civil enforcement proceeding was filed by the Securities and Exchange Commission’s New York Regional Office, under the direction of Mark P. Berger.