Blacklight SA, a Swiss asset management and trustee firm, with its founder Kenneth Ciapala and a company’s executive Ulrik Debo have been booked for the security fraud. The charges against the two executives and the firm were initiated by two prosecutors in New York last month but it was made public on Thursday, December 2, 2019.
Manipulating Stock Market and Security Fraud
The main charges against the Swiss firm, Blacklight SA and its two main executives are related to their involvement in illegal financial market operations and security frauds that dumped several investors. Without revealing their names, the two executives owned shares in many small trading companies and set up various manipulation schemes related to the stock market. With the help of the fake information, the two executives using the firm cheated several investors and made millions in profit. As revealed on Thursday, the prosecutors told, “Two executives and a Swiss firm linked to shell companies in the Panama Papers data leak were charged in the U.S. with scamming investors in pump-and-dump schemes.”
FBI Assistant Director, William F. Sweeney Jr. told, “As a major facilitator of market manipulation schemes, Blacklight, S.A, allegedly enabled numerous ‘pump and dumps’ over the course of six years. Disrupting the orchestrators of illegal financial activity is a top priority for the FBI’s securities fraud team, and we consider today’s indictment of Blacklight, its founder and principal owner Kenneth Ciapala, and co-conspirator Ulrik Debo an important step in that mission.”
As added by Attorney, Geoffrey S. Berman Thursday, “As alleged, for years the Swiss firm, Blacklight S.A., its owner, Kenneth Ciapala, and Ulrik Debo have made millions of dollars by orchestrating stock manipulation schemes of publicly traded shares of US-based issuers. Today’s charges make clear that our Office, along with our law enforcement partners, will vigorously prosecute those who allegedly manipulate the stocks of U.S. issuers, including those operating abroad.”
Kenneth Cipala and Ulrik Debo’s Roles
Kenneth Ciapala, who holds dual citizenship of the U.K. and Switzerland founded the Swizz firm, Blacklist. Ciapala involved in implementing fraudulent schemes using Blacklist and collected several funds through various nominee entities.
Ulrik Debo, a Danish citizen living in Europe, helped the fraudulent schemes by propagating false information regarding several traded shell companies and other illegal financial transactions including the ‘reverse merger’ deal. The two executives Ciapala and Debo had been arrested in the UK and they are likely to be extradited to the US in the coming days.
Blacklist executed the schemes through opening bank accounts on behalf of these nominee entities. According to the Offshore Leaks Database maintained by the International Consortium of Investigative Journalists, “the Swiss firm was at the center of 14 shell companies incorporated in British Anguilla, Samoa and elsewhere.” The prosecutors stated, “The shell companies were incorporated in 2014 and 2015 after the pump-and-dump scam had started.”
The prosecutors added, “Ciapala and Blacklight are accused of disguising the proceeds of the scheme with fake invoices to justify wire transfers through the financial system. Some of the transfers were sent directly to third-party sellers of luxury goods and automobiles.”
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