BUSINESS

US prosecutors: Canadian stock promoter admits taking part in price inflation scheme

07/14/2015 06:17 EDT | Updated 07/14/2016 05:59 EDT
NEWARK, N.J. - A Canadian stock promoter has admitted taking part in a scheme to artificially inflate the stock price of a publicly traded company through manipulative trading and other fraudulent means.

Federal prosecutors in New Jersey say 47-year-old Mitchell Adam, of Vancouver, pleaded guilty to conspiracy to commit securities and mail fraud. He now faces five years in prison when he's sentenced Oc. 27.

Prosecutors say that during a four-month period in 2013, Adam conspired with others to manipulate the stock of a Houston-based company. They obtained and concealed control of a significant portion of free-trading shares of the company's stock and agreed to fraudulently inflate the price and trading volume of the stocks through various means.

They allegedly planned to sell the stocks at the fraudulently inflated prices.