Ex-SEC lawyer gets 8 years prison in pump-and-dump

Fri Apr 23, 2010 8:35pm EDT

* Defendant convicted on 10 counts

* US: Defendant used spam e-mails, fake press releases

NEW YORK, April 23 (Reuters) - A former enforcement lawyer for the U.S. Securities and Exchange Commission was sentenced on Friday to eight years in prison for his role in a "pump-and-dump" scheme to artificially inflate the market prices of small stocks.

Phillip Windom Offill Jr, 51, was also ordered to forfeit $4.8 million when he was sentenced in the federal court in Alexandria, Virginia, the U.S. Department of Justice said.

A federal jury had convicted Offill on January 28 of nine counts of wire fraud and one count of conspiracy, court records show. The fraud took place after Offill had left the SEC and returned to private practice in Dallas, the government said.

Federal sentencing guidelines, which are advisory, had recommended a prison sentence of 14 to 17-1/2 years, court records show. Offill had contended the recommended range should have been 2 to 2-1/2 years, the records show.

A lawyer for Offill did not immediately return a call seeking comment.

The government contended that over eight months in 2004, Offill and a co-conspirator schemed to encourage investors to buy small stocks by issuing false press releases and tens of millions of "spam" e-mails.

It said the co-conspirators, having fraudulently boosted the market prices of the stocks, would then dump their own shares for large profits.

Ten other defendants have pleaded guilty in related stock manipulation schemes, and most also received prison terms, the government said.

The case is U.S. v. Offill, U.S. District Court, Eastern District of Virginia, No. 09-00134. (Reporting by Jonathan Stempel; Editing by Richard Chang)

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