SEC Sues Three in Stan Lee Stock Fraud Case
Reuters - The U.S. Securities and Exchange Commission on Wednesday said it has sued three people for manipulating the stock of Stan Lee Media, an online entertainment company founded by the comic book legend that collapsed in late 2000.
In a statement, the SEC said it sued company co-founder Peter Paul, senior operations executive Stephen Gordon and stock broker Jeffrey Pittsburg in federal court in Los Angeles.
The lawsuit alleges that between early October and late November of 2000, they manipulated the market for the company's stock. The three also face criminal charges in New York for securities fraud.
Stan Lee, one of the figures behind Spider-Man and a number of other comic superheroes, is now involved with another public company, POW! Entertainment, as its chief creative officer. He was not implicated in the SEC probe of Stan Lee Media.
Gordon, without admitting or denying guilt, has agreed to a settlement that bars him from future violations of securities laws and from serving as an officer or director of a public company. Last August he was sentenced to 6-1/2 years in federal prison after convictions in Los Angeles on charges of wire and bank fraud for writing bad checks to buy Stan Lee Media stock.
An attorney for Paul was not immediately available to comment. An attorney for Pittsburg said he had not yet reviewed the complaint with his client and could not comment.
The SEC said that Paul and Gordon tried to buy Stan Lee Media stock with bad checks and sold stock at below-market prices, while Pittsburg tried to influence the price of the stock with late purchase orders and tried to use an electronic trading platform to disguise the source of the demand.
The commission said it was seeking orders barring the three from future violations of securities laws and forcing Pittsburg to disgorge his income from the arrangement.