Ron,
Here is some information on how terrible things are done relative to securities. You may be able to tell us a lot more about this one since it is local. There are a couple of local phone numbers that you might want to call and share some URL's.
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1996-04-26 -- Securities and Wire Fraud Indictment
MN Business promoter, a Minneapolis CPA and NY stockbroker charge
with securities and wire fraud in connection with MN company.
United States Attorney
District of Minnesota NEWS RELEASE
_________________________________________________________________
Contact: Karen A. Bailey, Media Coordinator (612) 348-1514
David L. Lillehaug, United States Attorney (612) 348-1500
FOR IMMEDIATE RELEASE
Friday, April 26, 1996
MINNEAPOLIS, MN - United States Attorney David
Lillehaug announced today that a federal grand jury in
Minneapolis has returned a superseding indictment that charges
a Minneapolis business promotor, a Minneapolis CPA and a New
York stockbroker with securities and wire fraud in connection
with the trading in shares of Angeion Corporation, a Minnesota
based manufacturer of cardiovascular products.
The 40 count superseding indictment, which encompasses
and replaces a former indictment, charges Robert Maietta, 47,
from White Bear Lake, MN, Steven A. McMichael, 46, from
Waconia, MN, and Steven D. Gellas, 45, from West Caldwell, NJ.
Maietta was a self-employed promoter and partner in
Resource Investment Group which controlled approximately
170,000 shares of Angeion stock. McMichael was a CPA and one
of the original shareholders of Angeion when it went public in
1988. Gellas was a registered representative of a New York
brokerage firm.
According to the indictment, Maietta, McMichael and
Gellas conspired together and with others to manipulate the
price of Angeion stock through a series of controlled and
prearranged purchases and sales of Angeion common stock.
The grand jury alleges that the defendants attempted to
manipulate the price of Angeion stock through the use of
numerous deceptive and manipulative devices, including, in
part, "wash sales" and "matched orders." "Wash sales" involve
sales of stock that result in no change in beneficial
ownership. "Matched orders" involve entering nearly identical
buy and sell orders for the purchase or sale of a security.
The grand jury alleges that the defendants engaged in these
activities to support Angeion's stock price and create the
false appearance that the trades constituted arms-length
transactions involving disinterested parties.
During the course of the conspiracy, Maietta, McMichael
and Gellas allegedly engaged in trades of Angeion stock
involving over one million shares and totaling in excess of
$9.3 million. The indictment alleges that the price of
Angeion stock collapsed when the defendants ceased their
manipulative and deceptive conduct. Angeion stock prices fell
from a high bid on March 6, 1991 of $10.375 to a closing bid
of $3.625 on June 12, 1991, a loss in market value of $58
million.
U.S. Attorney David Lillehaug commented, "This is
certainly one of the largest securities fraud cases ever
charged in Minnesota. The indictment charges that these three
people tried to manipulate the stock price of one of
Minnesota's leading medical companies. Allegedly, when their
plan finally collapsed, many honest investors were hurt, to
the tune of a whopping $58 million." Lillehaug emphasized
that the grand jury has not alleged that Angeion Corporation
itself, or its officers or directors, were involved in any way
with the conspirators.
This is the second case arising out of the trading of
Angeion securities. In July 1995 John Silseth was charged and
pled guilty to providing false information to the Securities
and Exchange Commission in an attempt to conceal information
about the stock manipulation plan.
If convicted, the defendants face a maximum potential
penalty of five years in prison and/or a $250,000 fine on each
count of the indictment. Any sentence would be determined by
a judge based on the federal sentencing guidelines.
The case is the result of an investigation by the Federal
Bureau of Investigation and is being prosecuted by Assistant
United States Attorney Frank J. Magill.
###
Criminal indictments are only charges and not evidence of guilt.
presumed
to be innocent unless and until proven guilty.
U.S. Attorney for the District of Minnesota
David L. Lillehaug, United States Attorney
234 United States Courthouse, 110 South Fourth Street
Minneapolis, Minnesota 55401
Main Office Number: 612-348-1500
Public Affairs Office: 612-348-1514; fax: 612-348-1192
Karen A. Bailey: Media Coordinator
kbailey@justice.usdoj.gov
Archived News Releases/Documents: usdoj.gov
gopher://gopher.usdoj.gov |
