Costa Rican Broker Admits to Penny Stock Laundering

ALEXANDRIA, VA – The dirty money trail led straight to Costa Rica. Michael J. Randles, 49, a Canadian citizen and permanent resident of the Central American nation, admitted today to a conspiracy that pumped illicit funds through a web of shell companies and into fraudulent penny stock schemes. Randles pleaded guilty to conspiracy to commit money laundering in U.S. District Court for the Eastern District of Virginia.

According to court documents, Randles ran Moneyline Brokers – later rebranded as Trinity Asset Services – out of San Jose, Costa Rica. The operation wasn’t about legitimate investing. It was a front, utilizing aliases like Sandias Azucaradas CR, S.A., Vanilla Sky, Inc., Bastille Advisors, Inc., and Jurojin, Inc. to trade microcap, or “penny,” stocks. These trades were frequently tied to manipulative “pump-and-dump” schemes and aggressive “boiler room” operations, designed to fleece investors.

Randles wasn’t just a figurehead. He managed the Costa Rican office, oversaw the unregistered European securities business, and controlled the flow of money through a network of U.S. and offshore bank accounts, including those in Panama and throughout Europe. These accounts were the arteries through which the fraudulent profits were laundered, masking the origin of the ill-gotten gains. This wasn’t a victimless crime; countless investors likely lost savings to the schemes Randles facilitated.

This guilty plea isn’t an isolated incident. Three of Randles’ co-conspirators have already faced justice. Harold Bailey Gallison II received a staggering 216-month sentence, while Ann Marie Hiskey and Roger G. Coleman each received two years of probation. The length of Gallison’s sentence signals the severity of the crimes involved, and the government clearly intends to send a message.

Randles now faces a maximum penalty of five years in prison when sentenced on January 25, 2017. While the statutory maximum is set by Congress, the actual sentence will be determined by Judge Anthony J. Trenga, considering sentencing guidelines and other relevant factors. The U.S. Attorney’s Office for the Eastern District of Virginia, led by Dana J. Boente, and the FBI’s Washington Field Office, under Assistant Director in Charge Paul M. Abbate, spearheaded the investigation.

Assistant U.S. Attorneys Grace L. Hill, N. Nathan Dimock, and Michael O’Neill are prosecuting the case. Court documents related to Case No. 1:15-cr-178 are available on the U.S. Attorney’s Office website and through PACER. This case serves as a stark reminder that offshore havens won’t shield criminals from American justice. The Grimy Times will continue to follow this case and report on the sentencing.