Recidivist Securities Fraudster Sentenced to Five Years in Prison
PHILADELPHIA – U.S. Attorney William M. McSwain announced that Howard M. Appel, 57, of Wayne, Pennsylvania, was sentenced today by United States District Judge Paul S. Diamond to 60 months’ incarceration following Appel’s earlier conviction, upon his plea of guilty, to one count of conspiracy to commit securities fraud. The defendant’s sentence also includes three years of supervised release, a fine of $200,000, and a forfeiture payment of $3,868,699.46. The defendant has been detained in jail since his guilty plea in August 2018.
In 2010, approximately one year after his release from prison following two prior securities-fraud related convictions, Appel 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 manipulated the share price of the stocks by engaging in a complicated series of actions, including 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. In sentencing Appel, Judge Diamond found that Appel had obtained over $3,800,000 in illegal profits from his fraud in this case.
“Incredibly, this is Appel’s third securities-fraud related conviction,” said U.S. Attorney McSwain. “The defendant needs to understand that every time he commits a federal crime, he will be prosecuted. Hopefully, this will sink in over the next five years as he sits in jail. Prosecuting securities fraud and thereby safeguarding the integrity of the securities markets has been and will continue to be a top priority of my Office.”
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.