Stock Pump & Dumper|Faces up to 25 Years

DALLAS (CN) – A Texas federal jury Wednesday convicted the head of private jet-booking system operator ConnectAJet.com of a pump-and-dump securities fraud.
     Martin Cantu, 58, a Round Rock attorney, was convicted of conspiracy to commit securities fraud and securities fraud after a six-day trial.
     He faces up to five years in federal prison and a $250,000 fine for conspiracy and 20 years and a $250,000 fine for securities fraud. He will be sentenced on Sept. 9 by U.S. District Judge Ed Kinkeade.
     Stock promoter and company founder Jason Wynn, 32, of Lantana, Texas, pleaded guilty to conspiracy on April 30 and is awaiting sentencing.
     Prosecutors say that by the time Cantu joined the company, both men shelved any plans to make it a legitimate business and “instead focused on pumping and dumping” shares.
     “Over the course of 15 days in the fall of 2007, Cantu realized $552,341 in profits from the sale of 250,000 CAJT shares he controlled, which represented 83 percent of his total number of shares,” prosecutors said Wednesday.
     “Cantu sold these shares through an account in the name of his father. From August 2007 through January 2008, entities controlled by Wynn sold 4.2 million CAJT shares in the public market, resulting in profits of $2.585 million.”
     Prosecutors told jurors Wynn and Cantu published ads and public statements full of “false and misleading statements” about the company’s real-time booking system, customer base and “relationships with reputable companies,” in USA Today and CNBC.
     “The false and misleading statements led investors to believe CAJT’s online booking system was complete, when, in fact, it never was developed past the initial concept and design stage,” prosecutors said. “The false and misleading statements also led investors to believe that the company had achieved operational success it had not achieved.”
     Prosecutors said Cantu lied to the SEC to cover up the crimes. The SEC sued Cantu, stock promoter Timothy Page and entities controlled by Page in Federal Court in 2009.
     The SEC said that Cantu and Page reaped “ huge profits for themselves ” through “their scheme to funnel CAJ shares to the public.”

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