SEC Brings New Charges in Multimillion Dollar Boiler Room Schemes
Benjamin Conde, a repeat securities fraud offender, orchestrated a boiler-room scheme that manipulated RBNW stock through fraudulent promotions targeting seniors, secret trading against victims, and fake invoices, generating $3.1 million in illegal proceeds, leading to SEC civil charges and parallel criminal prosecution.
Benjamin Conde, a securities fraud recidivist, allegedly manipulated the stock of Renewable Energy and Power Inc. (RBNW) between March and July 2017, generating approximately $3.1 million in illegal profits by coordinating a New York boiler room to pump the stock to unsophisticated and elderly investors. He controlled entities—Essex Global Investment Corp. and Facultas Capital Management Inc.—to acquire RBNW shares via convertible notes, then disguised payments to the boiler room using fabricated invoices and used encrypted messaging to trade against victims, artificially inflating the stock price. The SEC charged him with market manipulation and fraud, seeking permanent injunctions, disgorgement of ill-gotten gains with interest, civil penalties, and a penny-stock bar, while naming his entities as relief defendants; parallel criminal charges were filed by the U.S. Attorney’s Office for the Eastern District of New York.
Benjamin Conde, a repeat offender in securities fraud, orchestrated a boiler-room scheme targeting seniors and unsophisticated retail investors by artificially inflating the price and trading volume of Renewable Energy and Power Inc. (RBNW) stock between March and July 2017. He acquired large blocks of RBNW shares through convertible notes purchased by Essex Global Investment Corp., an entity he controlled, and paid a New York-based boiler room to promote the stock fraudulently. To conceal his payments to the boiler room, Conde used fabricated invoices and coordinated trades on the opposite side of victims via encrypted messaging, further manipulating the market and maximizing his illicit gains. The SEC alleges he sold over eight million shares of RBNW, generating approximately $3.1 million in illegal proceeds. The SEC filed civil charges for market manipulation and fraud, seeking a permanent injunction, disgorgement of profits with interest, civil penalties, and a penny-stock bar, while naming Essex Global and Facultas Capital Management Inc. as relief defendants. Parallel criminal charges were filed by the U.S. Attorney’s Office for the Eastern District of New York, continuing a pattern of enforcement that includes two prior related actions involving the same boiler rooms and over $13 million in total alleged fraud. The SEC’s Retail Strategy Task Force and Office of Investor Education and Advocacy are urging investors to verify broker backgrounds via Investor.gov, and the investigation involved collaboration with the FBI, FINRA, and federal prosecutors.
Exhibits & Attached Documents (1)
Extracted insights
- $10.00M $10 million $10M–$100M
- $3.30M $3.3 million $1M–$10M
- $3.10M $3.1 million $1M–$10M
- person benjamin conde
- company essex global investment corp.
- company facultas capital management inc.
- company manipulation of millions of shares of renewable energy and power inc.
- person new charges
- person parallel criminal charges
- agency Securities and Exchange Commission
- scheme_term source of his payments to the boiler room by making payments to an intermediary
- Securities and Exchange Commission announced new charges
- Benjamin Conde orchestrated manipulation of millions of shares of Renewable Energy and Power Inc.
- Conde acquired large blocks of RBNW shares through convertible notes purchased from RBNW by Essex Global Investment Corp.
- Conde paid New York boiler room to promote RBNW stock to seniors and unsophisticated retail investors
- Conde sold more than eight million shares of RBNW
- Conde disguised source of his payments to the boiler room by making payments to an intermediary
- SEC is seeking permanent injunction, return of allegedly ill-gotten gains with interest, civil penalties, and a penny-stock bar
- Essex Global Investment Corp. received proceeds from the alleged fraud
- Facultas Capital Management Inc. received proceeds from the alleged fraud
- U.S. Attorney’s Office for the Eastern District of New York filed parallel criminal charges
The Securities and Exchange Commission today announced new charges arising from a New York-based boiler-room scheme, alleging that Benjamin Conde orchestrated the manipulation of millions of shares of Renewable Energy and Power Inc. (RBNW), generating approximately $3.1 million in illegal proceeds. The SEC alleges the fraudulent scheme began when Conde, a securities fraud recidivist, acquired large blocks of RBNW shares through convertible notes purchased from RBNW by Essex Global Investment Corp., an entity that Conde controlled. As alleged, from approximately March to July 2017, Conde paid a New York boiler room to promote RBNW stock to seniors and unsophisticated retail investors, fraudulently “pumping” the market price and trading volume of RBNW. According to the SEC’s complaint, Conde engaged in manipulative trading, including by coordinating trading on the opposite side of the boiler room victims through encrypted messaging, which further artificially raised RBNW’s market price. The SEC alleges that Conde sold more than eight million shares of RBNW, generating millions in illicit profits. Conde allegedly disguised the source of his payments to the boiler room by making payments to an intermediary pursuant to fabricated invoices. The SEC’s complaint, filed in Central Islip, New York, charges Conde with market manipulation and fraud. The SEC is seeking a permanent injunction, return of allegedly ill-gotten gains with interest, civil penalties, and a penny-stock bar. Essex and Facultas Capital Management Inc., Conde-controlled entities that received proceeds from the alleged fraud, were named as relief defendants. The SEC’s charges today follow two related actions in which the same affiliated boiler rooms were used to carry out the alleged schemes. In July 2017, the SEC charged two boiler rooms and 13 individuals with bilking victims out of more than $10 million in penny stock scams, and in November 2018, the SEC charged one of the boiler rooms and four individuals with a separate manipulation that generated over $3.3 million in illegal profits. The SEC’s litigation in the two actions are continuing. The U.S. Attorney’s Office for the Eastern District of New York filed parallel criminal charges in these matters and in a parallel action filed today. “As alleged in our complaints, elderly and unsophisticated investors have lost millions of dollars as a result of these boiler room schemes. The SEC has worked in parallel with the U.S. Attorney’s Office for the Eastern District of New York to hold the perpetrators accountable, despite their alleged attempts to use sophisticated and complex methods to conceal their fraudulent conduct,” said Carolyn M. Welshhans, an Associate Director in the SEC’s Division of Enforcement. The SEC’s Retail Strategy Task Force and its Office of Investor Education and Advocacy encourage investors to check the background of anyone selling or offering them an investment using the free and simple search tool on Investor.gov. The SEC’s continuing investigation is being conducted by Cecilia B. Connor and Andrew Elliott and supervised by Ms. Welshhans and Amy L. Friedman, with assistance from Leigh Barrett. The SEC’s litigation will be handled by James Smith and Matthew Scarlato and supervised by Jan Folena. The SEC appreciates the assistance of the Financial Industry Regulatory Authority, Federal Bureau of Investigation, and the U.S. Attorney’s Office for the Eastern District of New York.
The Securities and Exchange Commission today announced new charges arising from a New York-based boiler-room scheme, alleging that Benjamin Conde orchestrated the manipulation of millions of shares of Renewable Energy and Power Inc. (RBNW), generating approximately $3.1 million in illegal proceeds. The SEC alleges the fraudulent scheme began when Conde, a securities fraud recidivist, acquired large blocks of RBNW shares through convertible notes purchased from RBNW by Essex Global Investment Corp., an entity that Conde controlled. As alleged, from approximately March to July 2017, Conde paid a New York boiler room to promote RBNW stock to seniors and unsophisticated retail investors, fraudulently “pumping” the market price and trading volume of RBNW. According to the SEC’s complaint, Conde engaged in manipulative trading, including by coordinating trading on the opposite side of the boiler room victims through encrypted messaging, which further artificially raised RBNW’s market price. The SEC alleges that Conde sold more than eight million shares of RBNW, generating millions in illicit profits. Conde allegedly disguised the source of his payments to the boiler room by making payments to an intermediary pursuant to fabricated invoices. The SEC’s complaint, filed in Central Islip, New York, charges Conde with market manipulation and fraud. The SEC is seeking a permanent injunction, return of allegedly ill-gotten gains with interest, civil penalties, and a penny-stock bar. Essex and Facultas Capital Management Inc., Conde-controlled entities that received proceeds from the alleged fraud, were named as relief defendants. The SEC’s charges today follow two related actions in which the same affiliated boiler rooms were used to carry out the alleged schemes. In July 2017, the SEC charged two boiler rooms and 13 individuals with bilking victims out of more than $10 million in penny stock scams, and in November 2018, the SEC charged one of the boiler rooms and four individuals with a separate manipulation that generated over $3.3 million in illegal profits. The SEC’s litigation in the two actions are continuing. The U.S. Attorney’s Office for the Eastern District of New York filed parallel criminal charges in these matters and in a parallel action filed today. “As alleged in our complaints, elderly and unsophisticated investors have lost millions of dollars as a result of these boiler room schemes. The SEC has worked in parallel with the U.S. Attorney’s Office for the Eastern District of New York to hold the perpetrators accountable, despite their alleged attempts to use sophisticated and complex methods to conceal their fraudulent conduct,” said Carolyn M. Welshhans, an Associate Director in the SEC’s Division of Enforcement. The SEC’s Retail Strategy Task Force and its Office of Investor Education and Advocacy encourage investors to check the background of anyone selling or offering them an investment using the free and simple search tool on Investor.gov. The SEC’s continuing investigation is being conducted by Cecilia B. Connor and Andrew Elliott and supervised by Ms. Welshhans and Amy L. Friedman, with assistance from Leigh Barrett. The SEC’s litigation will be handled by James Smith and Matthew Scarlato and supervised by Jan Folena. The SEC appreciates the assistance of the Financial Industry Regulatory Authority, Federal Bureau of Investigation, and the U.S. Attorney’s Office for the Eastern District of New York.