California Resident Charged in Fraud Scheme Targeting Retail Investors

(HedgeCo.Net) The Securities and Exchange Commission has announced that it filed an emergency action charging California resident Charlie Abujudeh with running microcap fraud schemes targeting retail investors.

According to the SEC’s complaint, filed today in the U.S. District Court for the Eastern District of New York, Abujudeh worked with others from August 2019 to at least September 2020 to fraudulently sell several microcap companies’ stock to investors by making misleading statements during high pressure sales calls and/or email promotions. The SEC alleges that, as part of the scheme, Abujudeh and his associates convinced investors to invest in the stock of Odyssey Group International, Inc., as well as other microcap companies, including Scepter Holdings, Inc., and CannaPharmaRx, Inc. Abujudeh paid stock promoters to tout Odyssey stock over the phone to unsuspecting retail investors who were recruited through false and misleading representations. Abujudeh also allegedly paid for email promotional campaigns and schemed to hide his control over and simultaneous sale of Odyssey, Scepter, and CannaPharmaRx stock into the increased demand that the promotions he paid for had generated. According to the complaint, Abujudeh generated over $9 million in illicit proceeds by selling Odyssey, Scepter, and CannaPharmaRx stock to investors during the promotions he funded. The SEC alleges that Abujudeh funneled hundreds of thousands of dollars of the illegal Odyssey stock sale proceeds to an Odyssey insider with whom he had been coordinating.

The SEC’s complaint charges Abujudeh with violating the antifraud and registration provisions of the federal securities laws. The SEC is seeking an order freezing the defendant’s assets, permanent injunctions, the return of allegedly ill-gotten gains with prejudgment interest, civil penalties, a penny stock bar, and an officer and director bar.

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