The US Securities and Exchange Commission has triumphed in a lawsuit in which Airborne Wireless Network and a California man who covertly led the company were accused of pulling off a $45 million pump-and-dump scam.
(Bloomberg) — The US Securities and Exchange Commission has triumphed in a lawsuit in which Airborne Wireless Network and a California man who covertly led the company were accused of pulling off a $45 million pump-and-dump scam.
US District Judge Colleen McMahon on Tuesday issued a judgment, without having held a trial, in favor of the SEC. She rejected a request from Airborne and Kalistratos “Kelly” Kabilafkas to dismiss the suit.
The SEC alleged Kabilafkas bought millions of shares in the company and artificially inflated the stock price. The scheme, from August 2015 to May 2018, was carried out through a promotional campaign, and material omissions and misrepresentations in regulatory filings, according to the SEC’s claims.
Kabilafkas and a group of associates dumped the vastly overpriced shares on the market, the SEC said, pocketing about $23 million. Airborne also fraudulently raised more than $22 million from investors, according to the SEC’s 2021 complaint.
Evidence spanning 290 documents and audio exhibits supports SEC’c claims, McMahon said in her ruling. That included wire transfer records, emails from Kabilafkas to Airborne executives and recorded conversations where he impersonated his father in discussions with representatives of Merrill Lynch & Co., she said.
The case is Securities and Exchange Commission v. Airborne Wireless Network, 21-cv-01772, U.S. District Court, Southern District of New York (Manhattan).
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