San Diego, California - A federal jury convicted Andrew Hackett, a Canadian citizen who previously resided in Toronto, Canada, of participating in a securities fraud pump-and-dump scheme surrounding the publicly-traded stock of a small company.
The jury found that Hackett committed securities fraud, and conspired to commit securities fraud, by engaging in a scheme to manipulate the market for Arias Intel Corp stock. According to the evidence presented at trial, Hackett’s scheme included efforts to artificially inflate the price of Arias Intel’s stock by controlling the majority of the company’s free-trading shares through concealed offshore and other nominee accounts, coordinating the company’s press releases with the issuance of penny stock newsletters, and using high-pressure call rooms targeting innocent investors. Hackett and his co-conspirators also engaged in manipulative trading to create the appearance that Arias Intel stock traded at higher prices and with greater volume than was actually the case.
The FBI investigated this case through a combination of forensic analysis and sophisticated covert techniques, including the use of an undercover agent and an informant, both of whom gathered evidence through recorded phone conversations and captured email and text messages.
Hackett was one of several defendants charged here. His co-conspirators, Kuldeep Sidhu of Vancouver, British Columbia, Annetta Budhu of New York, New York, and Kevin Gillespie of Tampa, Florida all pleaded guilty in connection with the scheme.
“In addition to victimizing innocent investors, pump and dump schemes weaken the integrity of securities markets and alter the level playing field consumers expect when making investment decisions,” said Acting U.S. Attorney Randy S. Grossman. “As this verdict demonstrates, those who engage in pump-and-dump and similar market manipulation schemes will face serious consequences.” Grossman commended the work of Assistant U.S. Attorneys Aaron P. Arnzen and Andrew J. Galvin and the FBI agents who diligently pursued this matter.
“Securities fraud is a serious crime which impacts our citizens and our financial markets. The FBI is committed to aggressively investigating these complex crimes with considerable resources and sophisticated techniques,” stated FBI San Diego Special Agent in Charge Suzanne Turner. “The criminal enterprise behind this scam attempted to commit wholesale fraud using boiler rooms to victimize ‘mom and pop’ investors, including some of our elderly citizens. The hard work of our agents certainly limited the number of victims and losses in this case.”
Hackett will be sentenced for his crimes on October 25, 2021.
DEFENDANT Case Number 18cr3072-TWR
Andrew Hackett Age: 32 Toronto, Canada
SUMMARY OF CHARGES
Securities Fraud – Title 15, U.S.C., Section 78(j)
Conspiracy to Commit Securities Fraud – Title 18., U.S.C., Section 371
Maximum Penalty: 20 years
AGENCY
Federal Bureau of Investigation
