A Dix Hills man pleaded guilty in federal court Wednesday to participating in a $147-million scheme to defraud investors.
McArthur Jean, 34, of Dix Hills, pleaded guilty to one count of conspiracy to commit securities fraud and agreed to forfeit more than $110,000. When sentenced, Jean faces a maximum of five years’ imprisonment.
Also pleading guilty Wednesday was Ronald Hardy of Port Jefferson. Hardy, who was a manager at My Street Research and its predecessors , known as the boiler room, pleaded guilty to conspiracy to commit securities fraud, conspiracy to commit wire fraud, conspiracy to commit money laundering and five counts of securities fraud.
Richard P. Donoghue, United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office ( announced the guilty pleas.
The prosecutor’s office said that between January 2014 and July 2017, Hardy and Jean, together with their 14 codefendants and others, engaged in a scheme to defraud investors and potential investors in publicly traded companies, including National Waste Management Holdings, Inc., CES Synergies, Inc., Grilled Cheese Truck, Hydrocarb Energy Corporation, and Intelligent Content Enterprises, Inc.,
The defendants executed this scheme by (a) artificially generating price movements and trading volume in the shares, (b) causing material misrepresentations and omissions in their communications with victim investors 2 about the advisability of purchasing the shares and (c) fraudulently concealing their control of shares of the manipulated public companies that were held in brokerage accounts in the names of other individuals or entities. In addition, Hardy and other defendants conspired to launder approximately $14,714,493 in proceeds of the stock manipulation scheme. Hardy and Jean are among 16 defendants charged in this case, and the ninth and tenth defendants, respectively, to plead guilty.
The eight defendants who previously pleaded guilty to various charges for their participation in the scheme are Erik Matz, a manager at the Boiler Room, Boiler Room cold-callers Brian Heepke, Dennis Verderosa, Emin L. Cohen, Paul Ewer, Ashley Antos and Sergio Ramirez, and Robert Gilbert of Cold Spring Harbor, a cold-caller operating from his own company.