Michael Saquella and Lawrence Kaplan

Washington, DC: (Sep-06-07) The US Securities and Exchange Commission brought chargers against Michael Saquella and Lawrence Kaplan, two Arizona-based stock promoters, alleging that they participated in securities fraud. Authorities charged that the pair dumped millions of shares of penny-stock companies onto investors after artificially inflating the price of the stocks. Altogether, the two men reaped nearly $3 million from the alleged "pump and dump" scheme, which they agreed to return as part of the SEC settlement. The pair pleaded guilty to securities fraud charges and agreed to be barred from penny-stock deals under a related settlement of a civil lawsuit announced by the SEC. Saquella, 47, also known as Michael Paloma, and Kaplan, 63, of Scottsdale, also face up to five years in prison based on their guilty pleas, entered earlier this summer. SEC officials described Saquella as a repeat offender, saying he had been fined in 2002 after being charged with manipulating shares in a penny-stock company.

In the latest action, the SEC said Saquella and Kaplan inflated shares of Courtside Products Inc., Latin Heat Entertainment Inc., Xtreme Technologies Inc., PokerBook Gaming Corp., Commanche Properties Inc, TKO Holdings Inc. and Motion DNA Corp. Criminal prosecutors levied similar charges and said the pair also inflated shares in other companies- eDollars Inc., Trans-Global Holdings Inc., Body Scan Corp., Integrity Messenger, Beverly Hills Film Studies, V3 Global Inc., Ifinix Corp., Zuma Beach Entertainment and Cor Equity Holdings. Authorities said the promoters boosted the price of the penny stocks by issuing bogus press releases and sending spam e-mails touting the shares to millions of America Online accounts. [FORBES: STOCK PROMOTERS]

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Published on Sep-14-07