Stock Promoter Who Caused Tens of Millions in Losses Pleads Guilty to Securities Fraud Charges
PHILADELPHIA – United States Attorney William M. McSwain announced that Dino Paolucci, 41, of Mississauga, Ontario, entered a plea of guilty to four counts of securities fraud before United States District Judge Eduardo C. Robreno.
The charges resulted from the defendant’s participation in a scheme to manipulate the price and trading volume of the stocks of LiveWire Ergogenics (“LVVV”), YaFarm Technologies (“YFRM”), Resource Ventures (“REVI”), and Medical Cannabis Payment Solutions (“REFG”). This type of scheme is commonly referred to as a “pump-and-dump.”
During the course of the scheme, Paolucci, a stock promoter, worked with others to artificially increase the price and volume of the stocks through the use of false and misleading press releases, email blasts, radio advertisements and tweets, often in coordination with planned trading by other participants in the scheme. The misleading promotion in concert with planned trading was designed to control the price and volume of the stock. In order to hide their scheme from investors and regulators, Paolucci and his fellow schemers used offshore corporations and brokerage accounts, intermediaries, and even fake names, causing tens of millions of dollars of losses to investors while gaining millions in profits for themselves.
“Stock fraud is a danger to free markets and to individual investors, and our securities laws must be vigorously enforced to protect the public,” said U.S. Attorney McSwain. “Those who defraud investors and harm our securities markets will be tracked down and brought to justice, just as Paolucci was here.”
The case was investigated by the Federal Bureau of Investigations, with assistance from the Securities and Exchange Commission. It is being prosecuted by Assistant United States Attorneys Patrick Murray and Judy Smith.