Salt Lake Tribune- U.S. investigators, after posing as management of a phony hedge fund dubbed ”Fillmore Capital,” indicted six insiders and promoters of publicly traded companies for allegedly paying kickbacks to ensure stock purchases.
The hedge-fund manager was actually an undercover agent with the Federal Bureau of Investigation, prosecutors said in a statement. The Securities and Exchange Commission sued 10 people, allegedly involved in five separate kickback schemes, at federal court in Miami.
”All of the defendants agreed to pay a kickback. With one exception, the defendants actually paid the promised kickback after the hedge fund bought the stock defendants were promoting,” the SEC claimed.
The SEC, under Chairman Christopher Cox, is cracking down on frauds aimed at retail investors, who are often targets of efforts to manipulate penny-stock prices.
