The fraud and conspiracy case against recidivist fraudster Regis L. Possino and 10 others charged in connection with a multimillion-dollar “pump-and-dump” scheme appears to be nearing an end — in almost total secrecy.
Most of the documents filed in Possino’s case over the past two years were sealed by the judge, at the request of federal prosecutors or Possino’s attorney. But the docket shows that on Monday, prosecutors filed sentencing exhibits and a proposed restitution order.
That suggests that Possino — featured in several Sharesleuth stories — has agreed to a plea deal or is close to one. Filings in a separate action showed that he already forfeited his house in Pacific Palisades, Calif., which was to be sold for a minimum of $2.5 million.
The U.S. Attorney’s office in Los Angeles alleged in 2013 that Possino and his associates collected at least $18 million through “pump-and-dump” schemes involving three public companies.
The indictment said they manipulated the share prices of the companies, issued false press releases to generate investor interest, then dumped their own stock on an unsuspecting public. The companies used as vehicles were Sports Endurance Inc. (OTC: SENZ), FrogAds Inc. (formerly OTC: FROG), and Empire Post Media Inc. (OTC: EMPM).
A spokesman for the U.S. Attorney’s office in Los Angeles told Sharesleuth last year that he did not expect any of the cases against the defendants to come to trial.
A grand jury originally indicted 15 people, four of whom had appeared in previous Sharesleuth investigations. It alleged that they participated in two overlapping stock-manipulation rings that netted more than $30 million.
The defendants included Possino, who has convictions for drug dealing and fraud; Sherman Mazur, a onetime real estate mogul with a prior fraud conviction; and Edon Moyal, the former chief executive of a publicly traded energy-drink company called Who’s Your Daddy Inc. (formerly OTC:WYDY). While at that company, he was charged with aiding drug traffickers and later was sentenced to 18 months in prison.
The FBI said in its press release about the indictments in the pump-and-dump case that its investigation included a series of wiretaps that resulted in the interception of more than 60,000 phone calls and 24,000 text messages.
However, after questions arose about representations the FBI made to a judge to win approval for the wiretaps, the Justice Department withdrew the wiretaps as evidence and dropped the charges against Possino, Mazur and all other defendants in one of the cases.
That left 11 defendants in the case that survived. It is unclear why so many documents in that case have been sealed, or what information the prosecution and defense and trying to protect.
None of the unindicted co-conspirators mentioned in the original indictments have been charged in the nearly four years since the case was made public, nor has anyone else.
Court documents show that seven defendants besides Possino have agreed to plea deals and been sentenced. Prosecutors dismissed charges against two other defendants, saying the loss of the wiretaps would make it hard to win convictions.
The 11th and final defendant, Ivano Angelastri, remains a fugitive.