Former SEC Lawyer on Trial for Fraud
February 5th, 2010The tables have turned for Phillip Offill Jr.
In January, Offill went to an Alexandria, Va. courthouse because he was charged with the exact same type of crime he spent 15 years prosecuting as a federal Securities and Exchange Commission litigator.
On January 28, Offill was convicted on 10 counts of conspiracy and wire and securities fraud by a jury, according to a release from the U.S. Justice Department. Offill was immediately jailed after the verdict and faces significant prison time after the conviction.
According to the Dallas Morning News, Offill could face as many as 185 years in prison and be ordered to pay back as much as $15 million in lost funds.
“It is a sad day when a former U.S. Securities and Exchange Commission attorney uses what he learned in the government to later defraud the investing public,” Assistant Attorney General Lanny A. Breuer of the Criminal Division said after the verdict was given.
In 2004, Offill and Phoenix-based attorney David Stocker were involved in a scam to drive up prices of certain securities through press releases and spam-style email blasts, only to then sell the interests once the value went falsely went up, according to UPI. This type of scam is commonly called a “pump and dump.”
Along with the spreading information through media, the two lawyers also avoided stock registration requirements in order to hide the true nature of the stocks’ value when they wanted to sell at a high price, UPI reported.
In the criminal indictment against both Offill and Stoker, the two were accused of collaborating to register millions of shares in nine small companies that the two lawyers sold to investors, the Morning News reported. Once the prices went up through their media blasts and the lack of true records about the companies’ real finances, Offill and Stocker sold all shares in the valueless companies before stocks collapsed.
Stocker pleaded guilty to charges in 2009.
Earlier in January, Offill attended a court hearing within the federal court in mid-January on a contempt of court charge. He took the stand and defended himself against charges that he helped a client violate a court-order freeze on assets. Ironically, the freeze was placed on the individual after the SEC charged him with securities fraud, which is exactly the type of crime Offill used to prosecute.
Offill argued during the hearing that the assets considered frozen belonged to other companies that were labeled in the original court order as being a part of the freeze. He is scheduled to be sentenced in April.





















