The U.S. Securities and Exchange Commission (SEC) announced today that it has filed charges against James David O’Brien for running a multi-million dollar market manipulation program for years. According to the press release, he coordinated transactions between multiple trading accounts under his wife’s name or that of his wife at different brokers.
The Gibbsboro, New Jersey individual led the scam for nearly five years, specifically between 2015 and 2020, using 18 securities accounts at 14 different companies. The SEC complaint alleges he profited more than $ 9.6 million from the entire transaction. Further, the SEC claimed that O’Brien bought stocks at artificially low prices, then quickly sold them at artificially high prices.
“Specifically, the complaint alleges that O’Brien accumulated larger stock positions in one or more ‘winning’ accounts at a brokerage house, while at about the same time placing smaller orders on them. same securities from the opposite side of the market in one or more “help” accounts at another brokerage firm, ”the SEC said.
Authorities discovered that he made more than 18,000 transactions during the fraud scheme, 75% of which generated net profits on the affected accounts. The complaint was filed in federal court in Manhattan.
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The individual was charged with violating certain anti-fraud provisions of the Securities Exchange Act of 1934, seeking a permanent injunction and civil penalties.
Initial program fees
Two months ago, the SEC accused Sergei Polevikov, a former quantitative analyst, of having set up a prominent scheme. Polevikov worked in “two top asset management companies,” and such a scheme generated illicit profits of $ 8.5 million.
From January 2014 to at least October 2019, the former quantitative analyst had privileged access to orders and securities transactions from his employers in order to trade on his own system. Court documents filed in the US District Court for the Southern District of New York alleged that on almost 3,000 occasions Polevikov bought or sold shares on the same side his employers were trading.