SEC Charges Stock Randy Hamdan and Oracle Consultants
On December 10, 2013, the Securities and Exchange Commission (the “SEC”) charged Randy Hamdan and a related entity, Oracle Consultants LLC, with carrying out a pump-and-dump scheme in the securities of CompuSonics Video Corporation. The SEC claims that Hamdan generated illicit proceeds of approximately $30,000 through his corporate ego.
According to the SEC’s Complaint filed in U.S. District Court for the Eastern District of Michigan, Hamdan, who lives in the Dearborn, Michigan area, carried out the pump-and-dump scheme by engaging in manipulative trading and conducting a fraudulent marketing campaign. The SEC complaint also alleges that Hamden pretended to be a representative of CompuSonics and caused a news service to issue a false press release on behalf of CompuSonics.
Through the phony press release and fraudulent marketing campaign, Hamdan disseminated false claims that CompuSonics had “reached an out-of-court settlement” regarding the company’s patent portfolio and the phony press release added the claim that CompuSonics was “considering many options to bring back shareholder value,” including a cash dividend and a stock buy-back program. The Complaint alleges that in order to conduct the scheme, Hamdan employed numerous tactics to hide his true identity, including a proxy internet server, an anonymous email service, fictitious contact information, and a prepaid cellphone.
The SEC Action charges that Hamdan and Oracle violated the SEC’s anti-fraud provisions of Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. As to both Hamdan and Oracle, the SEC is seeking permanent injunctions, disgorgement of ill-gotten gains plus prejudgment interest, penalties, and a penny stock bar.
For further information about this securities law blog post, please contact Brenda Hamilton, Securities Attorney at 101 Plaza Real S, Suite 202 N, Boca Raton, Florida, (561) 416-8956, by email at [email protected] or visit www.securitieslawyer101.com.
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