Regular readers of our Lexington securities fraud blog know that in our previous post, we discussed pump and dump schemes. Pump and dump happens when fraudsters encourage investors to buy shares in a company (often with false and misleading statements) and then dump their shares when the price is high.
Equities.com recently took a look at the case of Jammin’ Java Corp. The company purportedly sold coffee products marketed with the name and image of reggae legend Bob Marley. In reality, the company had no real earnings.
Men who controlled 45 million shares helped drive the price of the penny stock upwards in early 2011, issuing a string of false and misleading press releases and online reports. The result was that the price hit a $6.35 high in May of that year.
The scammers reaped $78 million, the Securities and Exchange Commission said. The SEC has issued fines to more than one participant. The still-kicking Jammin’ Java has agreed to pay $700,000 to settle SEC claims.
Rohan Marley, son of the reggae legend, is active with the company. He has not been charged with any wrongdoing. Jammin’s stock was recently at 8.5 cents; a bit of an adjustment, to say the least.
In pump and dump and other varieties of securities fraud, investors are often left holding the bag. While government investigators might pursue charges and fines against the perpetrators, investors can be left empty-handed.
That is why so many victims of securities fraud turn to securities attorneys experienced in fighting for the rights and interests of investors. A form of litigation known as securities arbitration can result in a return of monies taken from you by an unscrupulous stockbroker or financial adviser.
On behalf of Mihalek Law posted in Securities Law on Thursday, July 14, 2016.
If you believe you may have a claim against your stockbroker or financial adviser, contact us online or call us at 859-233-1805 to speak with a Securities Attorney. MihalekLaw provides representation throughout the country.