Jonathan Curshen of Sarasota, Florida and San Jose, Costa Rica and Nathan Montgomery of Las Vegas, Nevada were found guilty of conspiracy to commit securities fraud and wire fraud for their roles in a $7 million stock manipulation scheme that defrauded investors.
Curshen was the principal of Red Sea Management (“Red Sea”) and Sentry Global Securities (“Sentry”), both located in San Jose, Costa Rica. Red Sea and Sentry provided offshore accounts and facilitated trading in penny stocks. Montgomery was a Las Vegas stock promoter.
According to the Department of Justice, the evidence at trial showed that in early 2007, Curshen and Montgomery schemed to illegally manipulate the stock price of a company called CO2 Tech.
According to the evidence at trial, Curshen, Montgomery and their co-conspirators, Robert Weidenbaum, Timothy Barham, Jr. and Ryan Reynolds, engaged in coordinated trades in conjunction with false and misleading press releases designed to artificially inflate the price of CO2 Tech stock.
According to the evidence at trial, the false press releases made it appear that the company had significant business prospects including Boeing, when it did not. According to the evidence at trial, the press releases and coordinated trades were used to create the appearance of legitimate buying interest by legitimate investors when in reality, Montgomery and his co-conspirators pumped the price of the stock then facilitated sales of the shares through Red Sea and Sentry to unsuspecting investors, including investors in South Florida. The evidence also showed that Montgomery, Weidenbaum, Reynolds and Barham were paid $1 million in cash to participate in the sham stock trades of CO2 Tech.
In addition, the evidence revealed that, from 2003 to 2008, Curshen laundered money through Red Sea and Sentry, including the proceeds from the stock fraud. Curshen was convicted of conspiracy to commit international money laundering in addition to the fraud charges.
Weidenbaum, Barham and Reynolds previously pleaded guilty to conspiracy to commit securities fraud, wire fraud and mail fraud. They are scheduled to be sentenced by Judge Richard Goldberg, United States District Court, Southern District of Florida on May 9, 2012. The sentencing for Curshen and Montgomery by Judge Goldberg is set for May 11, 2012.
Investors nationwide who have incurred investment losses, and who may have a FINRA arbitration claim, may contact the Florida securities arbitration lawyers at McCabe Rabin, P.A. for a free and confidential consultation by calling toll free at 877.915.4040 or by e-mail to firstname.lastname@example.org.