Defendant Forged Signatures and Backdated Documents as Part of a $3 Billion Pump-and-Dump Scheme
Today, before United States Magistrate Judge Vera M. Scanlon, suspended attorney XXXX Davies was arraigned on a four-count indictment charging securities fraud, conspiracy to commit securities fraud, wire fraud, and aggravated identity theft in connection with a market manipulation scheme.  A federal grand jury in Brooklyn returned the indictment on August 30, 2018.  Davies was previously arrested on a complaint in April 2018.  

Richard P. Donoghue, United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Edward Gallashaw, Assistant Postal Inspector-in-Charge of the New York Division of the U.S. Postal Inspection Service (USPIS), announced the indictment. 

“As alleged in the indictment, Davies used both sophisticated means and some of the oldest tricks in the book, including backdating documents and forging signatures, to deceive the investing public and manipulate the price and ownership of a public company’s stock,” stated United States Attorney Donoghue.  “The defendant’s scheme ultimately failed as a result of the outstanding investigative work by our prosecutors and our law enforcement partners, who are committed to protecting the integrity of public markets.”  Mr. Donoghue also expressed his gratitude to the New York Office of the United States Securities and Exchange Commission for its assistance during the investigation. 

“Criminals take what isn’t theirs and have no regard for victims they harm in the process,” stated FBI Assistant Director-in-Charge Sweeney.  “Mr. Davies allegedly pumped up the price of the stock for a public company because he controlled the information being made public, he knew exactly when to sell to make the most money, leaving other investors in the lurch.  Instead of enjoying the large sum of money he made, he now faces time in prison.”

“This is a classic case of greed overcoming honest business practices,” stated USPIS Assistant Postal Inspector-in-Charge Gallashaw.  “Mr. Davies allegedly used his knowledge of the market to ‘increase’ the value of stock he knew was worth pennies, taking money from investors he knew would result in a loss. While Mr. Davies tried to cover his illegal tracks with bogus documents, he couldn’t cover-up his crimes from Postal Inspectors and their law enforcement partners.”

Davies, an attorney whose law license was suspended, controlled a publicly traded company and manipulated the price of its stock in a pump-and-dump scheme.  Beginning in 2012, Davies exercised secret control over its predecessor companies through a series of nominal Chief Executive Officers.  As a part of his scheme, Davies accumulated a large number of shares in the company by fraudulently converting corporate debt into stock at no cost.  To effect these fraudulent debt-to-stock conversions, Davies forged the signatures of purported board members and backdated documents.  After accumulating large amounts of stock, Davies artificially increased the price of the stock through false and misleading press releases claiming that they had developed proprietary gaming and live-streaming app technology.  Although the stock had historically traded for pennies, its price rose to $12 per share at the height of the pump, resulting in a market capitalization of over $3 billion.  Davies’ coconspirators then dumped the stock at a profit, causing heavy losses to investors.

If convicted of wire fraud, the top count in the indictment, Davies faces a maximum sentence of 20 years’ imprisonment. 

The government’s case is being handled by the Office’s Business and Securities Fraud Section.  Assistant United States Attorneys Kaitlin Farrell and Mark Bini are in charge of the prosecution.

The Defendant:

XXXXX DAVIES
Parkland, Florida
Age: 50

E.D.N.Y. Docket No. 18-CR-479 (FB)

The following was taken from the SEC's and DOJ public website. 

When I told Davies NO I won't issues more shares he quickly moved to another ticker but thats when they caught him (in the following document) We can't sue a dead person and the brokers will eventually have to close the open shorts in a short squeeze.

DATA: XXXX Davies is a suspended Illinois attorney who was indicted and later pleaded guilty to federal charges stemming from his role in a multi-billion-dollar market manipulation scheme involving Gunther Grant, Inc. (ticker: GNGR).
The U.S. Securities and Exchange Commission (SEC) and federal prosecutors revealed that Davies covertly controlled the company behind the scenes. He utilized "pump-and-dump" tactics, microcap fraud, and corporate identity theft to artificially inflate penny stocks before attempting to unload millions of shares for illicit profits.
Case Details & Criminal Conviction
The Allegations: Davies used forged signatures, backdated documentation, and recruited "strawmen" to act as dummy CEOs for targeted companies. His goal was to secretly obtain and distribute shares of microcap entities like Gunther Grant.