| A California securities attorney was sentenced in Massachusetts District Court yesterday for his role in schemes to manipulate the stock of two publicly traded companies, Greenway Technology and Crown Marketing.
Jehu Hand, 62, was sentenced to 66 months in prison and three years of supervised release. Restitution will be determined at a later date. Hand was convicted in May following a 13-day trial of conspiracy, securities fraud and wire fraud. Following the verdict, Hand was remanded to the custody of the U.S. Marshals.
In the scheme involving the stock of Greenway Technology, Hand and his co-conspirators used front companies to conceal their control over the vast majority of Greenway’s stock, which then became available for sale to the public after Hand authored and sent several false opinion letters to the transfer agent and brokerage firms.
With millions of shares at their disposal, the conspirators proceeded to hire stock promoters to send blast emails to potential investors touting Greenway as a company on the verge of acquiring hotels which would cater to gay and lesbian travelers, when in fact the company lacked the requisite funds to acquire any such properties.
As a result of the hype created by the false and misleading promotional campaign, Hand and his co-conspirators were able to sell millions of shares of Greenway stock to ordinary investors at artificially high prices.
The scheme involving Crown Marketing stock followed a similar pattern. Hand and his co-conspirators once again used front companies to hide their control over most of Crown’s stock, which could be sold to the public as a result of a false filing that Hand had made with the U.S. Securities and Exchange Commission.
The conspirators then put out misleading press releases about the company and hired stock promoters to send blast emails touting Crown’s stock. In this case, Crown was billed as having revolutionary drug-delivery technology, when in actuality there was no real commercial interest in Crown’s product.
As with Greenway, once Crown’s stock price and trading volume spiked, Hand and his co-conspirators dumped their stock in the market at inflated prices.
In total, between the Greenway and Crown schemes, Hand and his co-conspirators caused losses of more than $1.5 million.
