An Alberta judge has handed down the province’s first jail sentence in connection with a “pump and dump” scheme, the Alberta Securities Commission (ASC) announced on Tuesday.
Joseph Bucci has been ordered to serve 18 months of house arrest after pleading guilty to acting as a securities dealer without registration, not filing a prospectus, and creating a false appearance of trading activity and an artificial price for securities, the ASC said.
Provincial Court Judge Catherine Skene accepted the pleas, and handed down an 18 month conditional sentence, the ASC said. In addition, Skene ordered Bucci be permanently banned from the securities markets, and that he forfeit any funds held by his company, Ox Financial Inc.
“This is the first court sentence to be handed down in a “pump and dump” market manipulation case in Alberta,” said the ASC’s director of enforcement, Cynthia Campbell, in a statement. “Jail is the appropriate starting point for this type of misconduct as it involves the deception of innocent purchasers of securities in the market. The conditional sentence recommendation was agreed upon by the ASC due only to Mr. Bucci’s serious health issues.”
The charges stem from a market manipulation involving the securities of Calgary-based Coastal Pacific Mining Corp. According to an agreed statement of facts in the case, Bucci admitted that he helped organize a shell company (Coastal Pacific, of which he was president and CEO) and got it quoted for trading on the U.S. over-the-counter (OTC) markets. He then participated in a promotional campaign that held drive up the price of the company’s stock, and its trading volume. The ASC reports that once the effort to hype the stock ceased, the trading and value of the Coastal Pacific securities returned to almost nothing.
The other accused in this case, Caroline Meyers (a.k.a. Caroline Winsor, a.k.a. Caroline Danforth), is scheduled to appear in court on Nov. 17, to speak to the charges.