FraudCaster

On November 24, 2009, six individuals were sentenced in federal court in Detroit for their roles in a wide-ranging international stock fraud scheme involving the illegal use of bulk commercial e-mails, or “spamming.”

In this Pump n’ Dump conspiracy, Frank Tribble, 42, of Bayside, N.Y., was sentenced to 51 months in prison for conspiring to commit wire fraud, mail fraud and to violate the CAN-SPAM Act, and also for committing wire fraud and engaging in money laundering. Tribble planned and directed the stock trading.

Judy Devenow, 56, of East Lansing, Mich., was sentenced to 18 months in prison. Devenow was a manager for a spam email service and sent spam emails herself to pump up the stocks.

William Neil, 46, of Fresno, Calif., was sentenced to 35 months in prison for conspiring to violate the CAN-SPAM Act and committing a substantive violation of the CAN-SPAM Act. He was the Chief Operating Officer of the company that owned and operated the computers used to send out the spam.

James Bragg, 40, of Sun Lakes, Ariz., and James Fite, 36, of Culver City, Calif., were each sentenced to 12 months and one day in prison. They were contract mailers for the spam operation.

David Patton, 49, of Centreville, Va., was also sentenced to 12 months and one day in prison. He created the spamming software used to send out millions of spam emails that violated the CAN-SPAM Act.

“The spam e-mails contained materially false and misleading information or omissions and were created and sent using software programs that made it difficult to trace them back to the conspirators.”

The investigation took three years. Others have been indicted and their cases are still pending.

These people used spam email to pump up the stock values with bogus information. Other pump n’ dumpers use internet chat rooms and discussion threads. While others, called your friends and family, pick up the phone and share the excitement.

The next time someone or something gets you excited about a stock purchasing opportunity, take a deep breath, do your homework and call an expert for advice. Keep your wallet closely guarded. Don’t just jump in because someone you know and trust is doing it. Smart being get fooled all the time.