SEATTLE, WA – Dickson Lee, 66, the former CEO of Tukwila-based L & L Energy Inc., is facing serious time after pleading guilty today in U.S. District Court to two counts of Securities Fraud. The case, a tangled web of lies and deceit, exposes how Lee allegedly manipulated the market and misled investors regarding his company’s financial health.
L&L Energy, once listed on the NASDAQ, claimed to be a major player in the Chinese coal industry – mining, washing, and wholesale distribution. But according to court documents, the entire operation was built on a foundation of fabricated reports. The Department of Justice alleges that Lee knowingly falsified reports submitted to the Securities and Exchange Commission (SEC), specifically concerning the existence of a Chief Financial Officer (CFO).
The first count of Securities Fraud centers around 2008 and 2009, when Lee was attempting to secure a listing on a national exchange. He allegedly claimed a CFO was in place, and that adequate internal controls existed, knowing full well neither was true. The individual Lee named as CFO had refused the position, and L&L operated without one. When confronted, Lee allegedly silenced the named individual with “tens of thousands of dollars in cash and stock,” and never disclosed the arrangement to shareholders. The deception continued in 2013, when Lee reportedly lied under oath during an SEC investigation about the CFO’s role.
The second count reveals an even bolder scheme. Between 2011 and 2012, Lee allegedly authorized the issuance of hundreds of thousands of L&L shares to individuals in China. These shares weren’t issued for legitimate compensation, but were instead directed to be sold on the market to prop up the cash-strapped company. Lee knew the SEC was already investigating L&L, and that raising capital through traditional means was off the table. He also knew his board had explicitly warned against issuing stock without full disclosure. The shares – approximately 730,000 of them – were falsely recorded as compensation for services never rendered.
The FBI led the investigation, with a parallel civil case being pursued by the SEC. Assistant United States Attorney Kathryn Kim Frierson is prosecuting the case, aiming to hold Lee accountable for his alleged crimes. This isn’t just a financial crime; it’s a betrayal of investor trust and a blatant disregard for the law.
Lee is scheduled to be sentenced on January 9, 2015, by U.S. District Judge Richard A. Jones. The Grimy Times will continue to follow this case and report on the sentencing. Investors left holding the bag by L&L Energy can only hope that justice is served and that Lee receives a sentence commensurate with the scale of his alleged fraud.
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Key Facts
- State: Washington
- Agency: DOJ USAO
- Category: White Collar Crime
- Source: Official Source ↗
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