Ex-Broker Sentenced To Prison In $147M Pump, Dump Scheme With LI Boiler Room

NEW YORK — A former registered broker who conspired with a boiler room in Melville to pump and dump stock on unsuspecting elderly investors was sentenced to 10 years in prison, the U.S. Department of Justice announced on Thursday.

Jeffrey Chartier, 59, of Sunny Isles, Florida, participated in a criminal conspiracy to promote and manipulate the price of shares in publicly traded companies, authorities said. He was sentenced on charges of conspiracy to commit securities fraud, securities fraud, conspiracy to commit wire fraud, money laundering conspiracy, and money laundering.

Chartier was also ordered to pay $1,022,399 in forfeiture and $6,083,603 in restitution. Chartier and Lawrence Isen, 69, of San Diego, were convicted in March 2020 after a six-week trial. Isen is awaiting sentencing.

“Jeffrey Chartier and his confederates lined their pockets with the lifetime savings of hard-working citizens they victimized all around the country,” United States Attorney Breon Peace stated. “[Thursday's] sentences should serve as a reminder to so-called white-collar criminals that this Office will hold them accountable for their selfish actions and the devastation they inflict upon the lives and families of others.”

From 2014 to 2016, Isen, Chartier and others working with a Melville-based boiler room artificially inflated the price and trading volume of stock in struggling companies with poor prospects and off-loaded it onto unsuspecting victims who were often elderly and vulnerable, prosecutors said.

The evidence at trial proved that from approximately 2014 to 2016, Chartier paid the boiler room to illegally prop up the stock price of National Waste Management Holdings, Inc., trading under the ticker symbol $NWMH, and CES Synergies, Inc., trading under ticker symbol $CESX, through manipulative trading, officials said.

Chartier also dumped his own $NWMH and $CESX shares on innocent investors through illegal matched trades, authorities said.

$NWMH and $CESX were previously profitable private companies that were each run by people seeking to retire, officials said. Chartier persuaded them to pay him in large blocks of stock to take their companies public on promises that doing so would sustain the companies for the future, prosecutors said. Instead, Chartier hired the boiler room, which fraudulently inflated these companies’ share prices using high-pressure sales tactics, and then dumped his own shares through matched trades, which caused the companies’ stock prices to plummet, officials said.

As part of the sentencing, the court ordered the repatriation of Chartier’s remaining shares in $NWMH and $CESX, the DOJ said.

Evidence at trial showed Isen colluded with crooked investors, both in the United States and overseas, to dump large volumes of shares in Hydrocarb Energy Corp., trading under the ticker symbol $HECC, and Intelligent Content Enterprises, Inc. trading under the ticker symbol $ICEIF, on the victims, prosecutors said.

Isen connected the investors with the boiler room, negotiating the terms of the arrangements between them, and managed the relationships between them, authorities said. Isen helped the boiler room in its illegal cold call campaigns that used lies and high-pressure sales tactics to lure victims, by, among other things, transferring money and stock required by the boiler room for the campaigns; working with the boiler room to fill the duped victims’ orders with Isen’s crooked investors’ stock; and creating fraudulent stock purchase agreements, consulting agreements and invoices to cover up the illegal conduct, the DOJ said.

The government calculated the conspiracy’s market manipulation fraudulently inflated the stock price of $HECC, $ICIEF, $NWMH and $CESX and one other company by more than $147 million, officials said. All 16 defendants charged in this case have been convicted.