Alleged Pump and Dump Stock Manipulation Scam Leads to Indictment of Six, Including a Securities Attorney

An indictment has been unsealed today accusing six people of securities fraud in a stock manipulation scam that bilked investors between 2003 and 2008. The Securities and Exchange Commission has also filed a civil complaint related to this case.

The defendants are securities attorney Michael Simon Krome, Jonathan Randall Curshen, Robert Lloyd Weidenbaum, Ronald Salazar Morales, Izhack Zigdon, and Eric Ariav Weinbaum. They are accused of illegally manipulating stock prices in a pump and dump scam.

Per the indictment, Weinbaum and Zigdon allegedly took charge of the outstanding shares of CO2 Tech, a company that traded in the over-the-counter market through Pink Sheet listings. They are said to have gotten the shares by hiring Krome, who allegedly took action to avoid federal securities registration requirements so that his co-conspirators would get millions of “free-trading” CO2 Tech shares that were unregistered and otherwise could not have been legally obtained. The shares were then allegedly sold to the general public through Sentry Global’s stock trading floor. Curshen was the principal of Sentry Global Securities and Red Sea Management, which are both based on Costa Rica.

Weinbaum and Zigdon are accused of paying Weidenbaum about $1 million to take part in bogus CO2 stock trades to make it seem as if actual investors were purchasing them. False press releases were also allegedly issued to make it seem as if CO2 Tech had substantial business prospects. After “pumping” the market price and demand, the defendants would “dump” the shares by selling them for substantial profit through the Pink Sheet listings. Frequently, these shares were practically worthless.

Related Web Resources:
Securities Attorney, Five Others Indicted In Stock Manipulation Scheme,, February 21, 2011

Securities Attorney and Five Others Indicted for Conspiracy, Wire Fraud, and Mail Fraud in Stock Manipulation Scheme, FBI, February 18, 2011

More Blog Posts:
Ex-Gilford Securities Broker Indicted in International Stock Fraud Scam Involving Pump and Dump of Israeli and Chinese Securities, Stockbroker Fraud Blog, February 19, 2011

Pump and Dump Scheme Involving Prime Time Stores Inc. Sends Global Spam Levels Up 30%, Stockbroker Fraud Blog, September 5, 2007

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