Florida Man Sentenced in Penny Stock Scheme
BUFFALO, N.Y. – James Palladino, a 54-year-old man from Delray Beach, Florida, has been sentenced to six months in prison for his involvement in a penny stock scheme. Palladino was convicted of conspiracy to engage in monetary transactions.
According to the U.S. Attorney’s office, between February and June 2011, Palladino and other co-conspirators participated in a scheme to acquire, manipulate, and trade publicly available stocks of companies with low stock prices, known as ‘penny stocks.’
During the scheme, Palladino and others directed co-conspirators to issue newsletters containing fictitious and misleading information regarding a targeted stock, which was done in an effort to manipulate the length and intensity of the penny stock promotion scheme.
Palladino and others utilized personal brokerage accounts and bank and brokerage accounts in the names of entities they owned and controlled, to fund, trade, and manipulate the price of penny stocks.
During the scheme, Palladino and others made payments totaling $175,000 for the fraudulent stock promotions, knowing that the funds used to make the payments constituted criminally derived proceeds from wire fraud activities.
The sentencing is the result of an investigation by Special Agents of the Internal Revenue Service, Criminal Investigation Division, under the direction of James D. Robnett, Special Agent-in-Charge, New York Field Office.
Palladino’s sentence includes six months in prison and an order to forfeit $175,000.
Key Facts
- State: New York
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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