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Stock Fraud May Bring Additional Arrests
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Published: March 14, 2008
TAMPA - Federal authorities said they expect to make more arrests in the case of a $70 million international stock scam that already has a Tampa Bay area father and daughter behind bars.
Barbara Gonzalez, spokeswoman for U.S. Immigration and Customs Enforcement, said Friday the investigation continues and "we have additional targets that we plan to arrest."
She declined to elaborate, but the criminal complaint against Paul Robert Gunter, 58, of Odessa and his daughter, Zibiah Joy Gunter, 25, of Oldsmar, refers to several co-conspirators, including at least two with ties to the Bay area.
The Gunters were charged in Tampa federal court Thursday with conspiring to commit and committing substantive acts of mail fraud, wire fraud, securities fraud and money laundering. They are being held without bail and are scheduled to return to court at 2 p.m Monday.
Authorities said they were involved in a scheme to "hijack" existing but dormant publicly traded companies. Such a tactic allowed the accused to tout those companies as established businesses that had sold shares in the past, had press releases and had trading symbols that potential investors could evaluate before making investment decisions.
The Gunters are accused of selling "virtually worthless" shares of stock in those companies to investors in the United Kingdom through a high-pressure boiler-room operation in Spain.
"This is a very important case to us, because these two individuals clearly demonstrated callous disregard for the hard-earned money of these citizens of the United Kingdom," Gonzalez said. The victims "thought they were investing their money in their future, and they the Gunters were lining their pockets with that. We do anticipate making additional arrests. There are additional targets."
Part Of Ongoing Investigation
In a statement released by Immigration and Customs Enforcement, Robert Wishart of the London police department's money laundering unit said the case is part of an investigation of boiler room fraud in the United Kingdom.
"Thousands of British people have fallen victim to this crime," Wishart said. "In this inquiry alone, we estimate that around 15,000 mostly elderly people have lost money."
The criminal complaint against the Gunters refers to several co-conspirators by number. It describes "Conspirator 1" as a lawyer licensed to practice in New York who lives in Florida and Costa Rica. The complaint quotes another conspirator as describing him as "very sophisticated, and he understands the process of acquiring the publicly traded shell companies." He is described as "more of a deal-maker than a detail lawyer." Conspirator 1 had rented a residence in Lutz, the complaint states, but provided the U.S. Postal Service with a Miami forwarding address in June 2007.
Also, a "Conspirator 4" is described as the incorporator and registered agent for one of the companies involved in the stock scheme and president and director of another. The complaint states that wire transfers of $50,000 and $47,000 were wired to Conspirator 4, who has a New Port Richey address.
The complaint identifies "Conspirator 5" and "Conspirator 6" as Houston lawyers.
SEC Halts Some Trading
On Thursday, the Securities and Exchange Commission halted trading in 26 companies in connection with the case and the complaint states the scheme could involve 54 corporate identities.
Investors' money was wired to a series of banks in Central Florida, including the Tampa Bay area. It could not be determined how much of the money involved went to the Gunters or whether it has been spent. Documents cited in the complaint suggest the proceeds were divided between the boiler room operator and various participants.
A related investigation by Canadian authorities in 2006 resulted in the freezing of $2.3 million in wire transfers from Europe to a Toronto bank, and a court ordered the funds returned to British investors. Of 166 investors identified, 153 proved their claims and received about 90 percent of their respective investments.
The Gunters face a maximum of 95 years imprisonment if convicted on the various charges. They also face a fine of twice their gross gain or twice the gross loss to the victims, whichever is greater.
Along with U.S. Immigration and Customs Enforcement, the joint investigation is being conducted by agents of the U.S. Secret Service with assistance from the SEC and law enforcement authorities in the United Kingdom and Canada.
Reporter Jerome R. Stockfisch can be reached at (813) 259-8402 or jstockfisch@tampatrib.com.
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