SEC Charges San Diego Based Penny Stock Promoter
On June 18 2013, the Security and Exchange Commission (SEC) charged a San Diego Penny Stock promoter, David F. Bahr, for fraudulently arranging the purchase of $2.5 million worth of shares in a penny stock company. The SEC also has issued an order to suspend trading in iTrackr securities. The SEC’s complaint alleges that Bahr violated Section 17(a)(1) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5. The complaint seeks financial penalties, a penny stock bar, and a permanent injunction against Bahr. The U.S. Attorney’s Office for the Southern District of California quickly followed suit by filing criminal charges. Bahr spearheaded the scheme in an attempt to generate the false appearance of market interest, and induce other investors to purchase the stock. The SEC’s complaint additionally states that he arranged for the dissemination of promotional materials that overstated the likelihood of iTrackr’s success and future profits.
In November 2012, Bahr allegedly conspired with a purported businessperson, who claimed he had access to a network of corrupt brokers, to artificially increase the trading price and volume of iTrackr systems stock. He would likely have been successful, if the businessman was not actually an undercover FBI agent. The SEC Claims that, “during a test run of their arrangement, Bahr paid a $3,000 kickback in exchange for the initial purchase of $14,000 worth of iTrackr shares.” Bahr had agreed not to disclose the kickback to any iTrackr investors.
The director of the SEC commented that they were able to “stop Bahr’s misconduct before he could seriously impact the markets and harm investors.”
The lawyers of KKBS handle securities fraud cases on behalf of individual investors. Contact Vincent D. Slavens at email@example.com or (619) 232-0331 for a consultation.