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Boca Raton resident William Lieberman, 42, has been sentenced to 84 months in prison, followed by three years of supervised release, and must pay back more than $5 million in restitution for his role in the scam.
John Durham, the United States Attorney for the District of Connecticut, announced the sentence on Friday.
Beginning in 2010 and spanning through July 2016, Lieberman conspired with others, including Connecticut resident Christian Meissenn, to defraud investors through a stock “pump and dump” fraud. Lieberman and his co-conspirators pleaded guilty to inducing investors to purchase securities by making false and misleading statements in calls and emails concerning companies, inflating the price of the stocks to become falsely inflated.
Durham said that “in his capacity as an officer of certain issuing companies, Lieberman, working with others, issued false and misleading press releases concerning the financial health and prospects of the companies. He also was aware that co-conspirators were making false and misleading statements to promote the sale of these securities.”
As part of the scheme, Lieberman arranged for Connecticut lawyer Corey Brinson and a second attorney from Colorado to sign false or misleading opinion letters that were designed to provide assurances to securities transfer agents and prospective investors. At times, he falsified the attorneys’ signatures to the opinion letters, which falsely certified that the attorneys had reviewed corporate records and filings for the issuing companies and were satisfied with the companies’ public disclosures.
This practice drove up share prices by creating the appearance of liquidity. Lieberman and his co-conspirators went on to sell their own shares at a profit, allowing the price of the securities to fall, leaving investors with a worthless stock. In total, there were more than 12,000 victims of Lieberman’s scheme, who lost nearly $19 million total.
Lieberman earned an estimated $1.2 million through the scheme, which he failed to report to the IRS, evading $436,235 in income taxes between 2011 and 2015. He pleaded guilty to one count of conspiracy to commit mail fraud and one count of tax evasion last year. He has also been ordered to pay $5,301,694 in restitution to his victims, as well as the back taxes owed to the IRS.
Several of Lieberman’s cohorts have already been sentenced to prison time, while Meissenn is awaiting sentencing. Lieberman remains released on bond and is due to report to prison on Aug. 13.
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