Two New York Men Charged with Manipulating Publicly Traded Stock
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that defendants Joseph Fabiilli, 58, of Middle Village, New York, and Christopher Knight, 55, of Forest Hills, New York, were charged by Indictment and arrested for conspiracy to commit securities fraud and securities fraud, related to their manipulation of the securities of Mainstream Entertainment, Inc., n/k/a Volt Solar Systems, Inc.
The Indictment alleges that Fabiilli, Knight and others manipulated the stock of Mainstream Entertainment, Inc., a publicly traded security, through fraudulent press releases, a fraudulent securities disclosure filed with the U.S. Securities and Exchange Commission, and other fraudulent communications, and through manipulative stock trading. The defendants and others were thus able to fraudulently inflate the price of Mainstream Entertainment stock, and then sell their own shares at inflated prices, reaping illicit proceeds – a scheme which is commonly referred to as a “pump and dump”.
“The United States’ securities laws exist to safeguard the integrity of the markets and to protect individual investors who play by the rules. Accordingly, they must be vigorously enforced,” said First Assistant U.S. Attorney Williams. “These defendants allegedly violated these laws and will be held accountable if convicted. The U.S. Attorney’s Office appreciates the substantial assistance provided by the U.S. Securities and Exchange Commission in investigating this case.”
“Fraudsters use ‘pump and dump’ schemes to enrich themselves, at the expense of innocent investors,” said Michael T. Harpster, Special Agent in Charge of the FBI's Philadelphia Division. “The FBI is committed to cracking down on such harmful market manipulation, to protect both the public and our financial system.”
If convicted, the defendants face a maximum possible sentence of 50 years imprisonment, a $500,000 fine, a 3-year period of supervised release, and a $200 special assessment.
The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Michael J. Rinaldi.
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.