New Hampshire Stockbroker Pleads Guilty To Microcap Stock Manipulation Scheme

On Wednesday, a New Hampshire stockbroker pleaded guilty to being involved in a market manipulation scheme, which was a part of an undercover operation. 57-year-old Robert Raffa of Penacook, New Hampshire, pleaded guilty to the following charges on Wednesday.

  • One count of conspiracy to commit securities and wire fraud
  • One count of securities fraud
  • Three counts of wire fraud

United States District Court Chief Judge Patti B. Saris has scheduled for the defendant to be sentenced on December 6, 2017. Raffa and a co-conspirator were arrested and charged in April of 2016. The defendants were accused of being involved in a scheme to manipulate the market for the public traded securities of Green Energy Renewable Solutions Inc.

The penny stock company claimed it was in the business of developing and operating waste processing and recycling facilities near Detroit, Michigan. Near the beginning of 2012, the conspirators used four foreign entities to obtain almost all of Green Energy’s unrestricted stock and they did so without reporting their controlling interest as required by law.

Then, the defendants hired a promoter to send emails to promote Green Energy to possible investors. They did so while selling shares, without disclosing that they were involved in the campaign. In the beginning, the promotion allowed those involved to sell over 1.5 million shares of Green Energy stock for more than $900,000.

After the first round of promotions ended, the defendants sought out a second promoter, while simultaneously using other manipulative techniques to keep the company’s stock price stable. Eventually, the men got involved with an undercover agent, who claimed to have access to a network of corrupt stockbrokers who were willing to buy their shares in exchange for kickbacks.

Raffa and the co-conspirator proceeded to sell 174,000 shares of the Green Energy stock to the supposed corrupt broker. After the trade was finalized, the conspirators wired $6,000 in kickback funds to the undercover agent, who was posing as a corrupt broker. The Securities and Exchange Commission also charged Raffa with securities fraud for his involvement in the scheme.

The charges were brought after a multi-year investigation into fraud in microcap stock markets. Again, Robert Raffa has pleaded guilty to the charges. He is scheduled to be sentenced on December 6, 2017.