Philip Frost, a billionaire from Miami, was accused of participating in a fraud scheme, which resulted in more than $ 27 million was laundered.
The securities and exchange Commission (SEC) claims that from 2013 to 2018, Frost, who founded the pharmaceutical company OPKO Health and is the main benefactor of the science Museum of Philip and Patricia Frost in Miami, as well as nine other investors manipulated the stock prices of three companies for their own profits. The SEC did not share the names of the three companies, according to Miami New Times.
According to the SEC, investors advertised the company without revealing that they own the stake, expecting the stock price to rise, and then sold their shares. Retail investors, meanwhile, ” remained virtually useless shares.”
“A group of accused engaged in slow market manipulation that promoted their financial interests, while innocent investors suffered and undermined the integrity of our securities markets,” said Sanjay Wadhwa, senior assistant Director of the SEC’s rights protection division. “However, they did not understand the determination of the SEC to aggressively pursue and punish the persons involved in fraud schemes with microcapsules”.
According to Forbes, the lawsuit called the company opko Health and Frost, although only the SEC believes that Frost was involved in two of the three schemes and earned approximately $ 1.1 million. It is estimated that a long-time health investor has a net worth of $ 2.6 billion.
Frost’s pharmaceutical company also stated that the SEC had not notified them of its intention to file a lawsuit and stated that the complaint contained serious factual inaccuracies.
“If the SEC followed its own standard procedures, OPKO and Philip Frost would be happy to provide information that would answer a number of obvious SEC questions, and filing a lawsuit against them could have been avoided,” the company said. “OPKO and Philip Frost have always been proud of the highest standards of financial disclosure, and they are confident that once a proper investigation is completed and the facts of the case are fully disclosed, the matter will be successfully resolved for them.”
The scheme was allegedly led by South Florida businessman Barry Hongi, one of the largest shareholders of Riot Blockchain Inc. the company, rabotaa with cryptocurrencies. Riot Blockchain, in which Hangig put a lot of investment, was summoned to court in April as part of a formal SEC investigation.
“Honig was the primary strategist, calling on other defendants to buy or sell shares, organize stock issues, negotiate deals, or engage in promotional activities,” the SEC said in a complaint.
Honig, who allegedly earned over $ 3.4 million on this scheme, was unavailable for comment.
