Vancouver businessman David Sidoo is facing new accusations of fraud, this time alleging he was a part of a multi-year “pump-and-dump” scheme that bilked investors out of more than US$145 million.
The allegations were revealed in a U.S. Securities and Exchange Commission (SEC) complaint lodged in the Southern District of New York district court on Thursday. Sidoo and seven other people wee named.
The complaint describes a scheme that operated from 2006 to 2020.
The SEC alleges the group gained controlling interests in companies, concealed their collective control of the stock, funded misleading promotional campaigns to drum up interest among unsuspecting investors, and then unloaded their stock holdings to cash in on the inflated stock price.
The group would allegedly divide profits, while holding some of the cash to fund their next pump-and-dump.
Ronald Bauer, a “London-based recidivist” was the mastermind of the operation, the SEC stated, and led the most prolific of three rings involved in the scheme.
Sidoo collaborated with that ring on two pump-and-dump campaigns, the SEC alleges, involving stock for North American Oil & Gas Corp. and American Helium Inc.
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Sidoo used offshore “omnibus vehicles and front companies” to conceal the fact he was the beneficiary of stock sales. He failed to disclose his beneficial ownership and to register his stock sales, as legally required the SEC claims.
The ring used Swiss financial services platforms to move the stock. The SEC alleges Sidoo and his co-conspirators illegally netted US$15.23 million when dumping their North American Oil stock in 2013 and 2014, and another US$1.45 million in the 2018-2020 selloff of American Helium stock.
In its filing, the SEC said Sidoo, who worked as a stock broker for eight years in the 1990s, would have been well aware of the federal securities laws that the scheme violated.
The SEC is seeking stock-trading injunctions against the accused, along with a return of the “ill-gotten” profits.
Sidoo has not been criminally charged. Through his lawyer, he has denied all allegations related to the SEC complaint. None of the claims have been proven in court.
Four of his alleged collaborators named in the SEC filing, including Bauer, a dual citizen of Canada and the U.K., and two other Canadians, Craig Auringer and Curtis Lehner are facing related wire and securities fraud charges, the Department of Justice announced Thursday.
Three other Canadian citizens, Dominic Calabrigo, Julius Csurgo, and Anthony Corculanic are facing criminal charges in relation to the alleged scheme.
Sidoo, a businessman, philanthropist and former CFL player, pleaded guilty to his part in the high-profile U.S. college admissions scandal in 2020, and was sentenced to 90 days in jail.
Prosecutors in that case alleged he paid to have someone take SAT tests for his sons, and attempted to pay for other tests on top of those.
He was later stripped of his Order of B.C. honour and his name was removed from the UBC football field.
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