(CN) - An attorney who ran an oil and gas services company pleaded guilty to obstructing justice during a securities fraud investigation, federal prosecutors said. Franklin C. Fisher Jr., 70, of Houston, pleaded guilty to a one-count information in District of Columbia Federal Court.
Fisher was CEO of Aztec Oil & Gas, from June 2007 through January 2010, and was a consultant from July 2004 through June 2007.
"Fisher admitted that, from in or about September 2004 through in or about May 2005, he and Shelly Singhal, a securities broker from Newport Beach, California and an investment advisor to Aztec Oil & Gas, helped to pay for newsletters recommending the purchase of Aztec Oil & Gas shares," prosecutors said in a statement. "The newsletters contained false and misleading disclaimers, purportedly paid for by 'a non-affiliated third party,' Bedford Proprietary Trading LLC. Bedford Proprietary Trading was a conduit used to receive cash payments directly and indirectly from Singhal, Fisher, and others to pay for the newsletters recommending the purchase of Aztec Oil & Gas shares."
Prosecutors said Fisher told them and the FBI that he did not recall the connection between Singhal and Singhal's firm and Bedford Proprietary Trading and did not know the details of the newsletters recommending the purchase of Aztec Oil & Gas shares.
Singhal was indicted in April 2010 on three counts for his role in stock manipulation schemes, including a "scalping" scheme involving the promotional campaign for Aztec Oil & Gas shares.
Singhal and others are accused of fraudulently obtaining at least $10 million by artificially increasing the demand for shares through newsletters of three companies that they controlled, including Aztec Oil & Gas. Singhal has pleaded not guilty.
Fisher is the third attorney to plead guilty. On Nov. 3, 2009, Robert S. Brown, of New Rochelle, N.Y., pleaded guilty to one count of obstruction of justice concerning, among other things, his business dealings with Singhal. Brown's sentencing has not been scheduled.
On Jan. 8, 2010, Melissa A. Mahler, of Rochester, N.Y., pleaded guilty to one count of making a false statement. Mahler's sentencing has not been scheduled.
As part of their plea agreements, Fisher, Brown, and Mahler agreed to cooperate in the investigation.
Fisher faces up to 10 years in prison. His sentencing has not been scheduled. He also agreed to forfeit $390,000.
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