Owner of Offshore Brokerage Firm Sentenced for Money Laundering
ALEXANDRIA, Va. – Michael J. Randles, 49, a Canadian citizen and permanent resident of Costa Rica, was sentenced today to 48 months in prison for his role in an international money laundering conspiracy in connection with international “pump and dump” securities fraud scheme.
This sentence takes into account 11 months of detention Randles served in Spain while contesting extradition to the United States, for which Randles will receive no further credit. The Court also ordered a 3-year term of supervised release, full restitution, and forfeiture.
According to admissions made in connection with his plea agreement, Randles controlled and operated an offshore brokerage and money laundering platform located in San Jose, Costa Rica, that went by various names, including Moneyline Brokers, Sandias Azucaradas, and Trinity Asset Services (collectively Moneyline) with his co-conspirator Harold Bailey Gallison II. Randles admitted that the purpose of Moneyline was to trade securities, primarily microcap or “penny stocks,” through U.S. and offshore accounts. While managing Moneyline’s Costa Rica office, Randles exercised authority over banking and financial transactions; operated Moneyline’s unregistered securities business in Europe; and opened U.S. and offshore brokerage and bank accounts, including in Europe and elsewhere, that were used to facilitate the conspiracy. Randles admitted that Moneyline often did business under the names of various shell companies to conceal both the true source and ownership of the securities and the flow of the funds.
Further, in connection with his plea, Randles admitted that Moneyline laundered approximately $1 million in proceeds from the pump and dump of the Colorado-based company Bryn Resources Inc. While Bryn Resources purported to be engaged in the mining and exploration of precious metals in Canada, in reality, Bryn was a shell company with no or nominal operations or assets. During the promotion of Bryn Resources, over 3.5 million shares of the company were liquidated through Moneyline accounts, generating the proceeds that were laundered through Moneyline accounts in the United States and overseas.
Three of Randles’s co-conspirators, Gallison, Ann Marie Hiskey and Roger G. Coleman, previously pleaded guilty in the case. Gallison was sentenced to serve 216 months in prison; Hiskey and Coleman were each sentenced to two years’ probation.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Kenneth A. Blanco, Acting Assistant Attorney General of the Justice Department’s Criminal Division; and Timothy Slater, Special Agent in Charge of the FBI’s Washington Field Office Criminal Division, made the announcement after sentencing by U.S. District Judge Anthony J. Trenga. Assistant U.S. Attorney Grace L. Hill and Senior Trial Attorney N. Nathan Dimock and Trial Attorney Michael O’Neill of the Criminal, Division’s Fraud Section prosecuted the case. The Securities and Exchange Commission, the Financial Industry Regulatory Authority and the Criminal Division’s Office of International Affairs also provided significant assistance.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:15-cr-178.