Kenneth Stromsland, Securities Fraud, Massachusetts 2018

BOSTON – In a shocking turn of events, Kenneth Stromsland, 46, of Rumson, N.J., pleaded guilty to charges of securities fraud in connection with a scheme to manipulate trading in PixarBio Corp.’s shares.

Stromsland, the former Vice President of Investor Relations for the Boston-based biotech company, admitted to engaging in manipulative trades in PixarBio stock that simulated market interest in the stock and artificially pushed up the trading price. These trades included orders to buy at a price much higher than the price of the preceding market transaction.

According to court documents, Stromsland began his manipulative trading scheme in or about November 2016. His false testimony before the SEC during a 2017 investigation into manipulative trading in PixarBio’s stock further exacerbated the issue.

Stromsland’s guilty plea has sparked widespread outrage within the biotech community, with many questioning how such egregious behavior could go unchecked for so long. The charges against him carry a maximum sentence of 20 years in prison, three years of supervised release, and a fine of $5 million.

The case against Stromsland was brought by the U.S. Attorney’s Office, with Assistant U.S. Attorney Sara Miron Bloom leading the prosecution. The FBI and the SEC Office of Inspector General also played key roles in the investigation.

Stromsland’s sentencing is scheduled to take place at a later date. In the meantime, he will remain free on bail. This high-profile case serves as a stark reminder of the importance of transparency and accountability in the financial sector.

United States Attorney Andrew E. Lelling and other law enforcement officials praised the work of the investigative team, stating that their tireless efforts had brought a corrupt individual to justice.

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