The United States Securities and Exchange Commission is suing former lawyer turned offshore shell facilitator Frederick Sharp of West 麻豆传媒映画for US$28.9 million.
On May 12 the U.S. District Court of Massachusetts entered a for failing to respond to civil securities fraud charges laid by the SEC. A judge ordered Sharp to repay US$21.8 million in ill-gotten gains and US$7.1 million in interest. Sharp was also handed a US$24 million civil penalty, which is not part of the lawsuit filed in B.C. Supreme Court July 7.
Sharp’s default judgment came after he failed to respond to his charges stemming from an Aug. 5, 2021 complaint alleging Sharp was the “mastermind” of an illegal enterprise dubbed by investigators as the “Sharp Group.”
This enterprise, the lawsuit claims, facilitated Sharp Group clients’ illicit sales of public company shares between 2010 and 2019. Sharp and his associates, largely based in B.C., established a network of offshore shell companies with nominee owners. He used a Curacao-based “clandestine communications network” wherein Sharp dubbed himself “Bond” while using a complex accounting system he named “Q” to track deposits, transfers, sales and purchases of stock.
“The purpose of these services appears to have been to allow clients to conceal their identities when purchasing and selling stock in public companies that were controlled and promoted by themselves and/or their associates,” the lawsuit states.
All told, investigators said Sharp dealt in hundreds of mostly U.S. companies and facilitated trading of over one billion dollars’ worth of shares with the intent of skirting securities laws, including public disclosures.
On Aug. 4, 2021, an arrest warrant was issued against Sharp in Boston. On Aug. 10, 2021, the district court issued a summons to Sharp, which he did not respond to. On Nov. 10, 2021, Sharp was unresponsive to a sheriff’s attempted service at his West 麻豆传媒映画home. .
The default judgment is said to be “final and conclusive” (not subject to appeal) and “deems true the allegations in the Complaint as against Sharp; finds that Sharp violated all provisions of United States securities laws alleged in the Complaint and orders monetary payment from Sharp, along with permanent restrictions on Sharp’s ability to participate in United States Capital markets.”
As of July 7, Sharp has not paid any money to the SEC, according to the lawsuit.
Sharp also faces criminal charges related to the alleged scheme. The U.S. Department of Justice has not filed to extradite Sharp, as it has with other B.C. residents facing criminal charges connected to the widespread scheme, such as Curtis Lehner and Hells Angel nomad Courtney Vasseur.
麻豆传媒映画lawyer David Gruber of Bennett Jones LLP is handling the case for the commission.
