Local Man Pleads Guilty To Conspiracy, Tax Offenses After 'Pump and Dump' Scheme: Feds

EAST MORICHES, NY — An East Moriches man has pleaded guilty to conspiracy and tax offenses stemming from his role in a securities fraud scheme, according to federal authorities.

Deirdre M. Daly, United States Attorney for the District of Connecticut, announced last week that Thomas Heaphy, Jr., 42, waived his right to be indicted and pleaded guilty, the U.S. Department of Justice said in a release.

Heaphy's personal gain from the scheme totaled approximately $719,000, according to a release from the U.S. Department of Justice.

According to court documents and statements made in court, between approximately 2011 and July, 2016, Heaphy conspired with others, including Christian Meissenn, William Lieberman and Damian Delgado, to defraud investors through a stock “pump and dump” scheme, the release said.

"Heaphy and his co-conspirators induced investors to purchase securities by making false and misleading representations in calls, emails and press releases concerning the securities and the issuing companies, thereby causing the price of those securities to become falsely inflated," the release from the U.S. Department of Justice said.

The issuing companies, "which were essentially shell companies with virtually no legitimate business activities", included Terra Energy Resources Ltd., stock symbol 'TRRE', Mammoth Energy Group, Inc., stock symbol 'MMTE', a company that later became Strategic Asset Leasing Inc., stock symbol 'LEAS', Trilliant Exploration Corporation, stock symbol 'TTXP', Hermes Jets, Inc., stock symbol 'HRMJ', which later became Continental Beverage Brands Corporation, stock symbol 'CBBB', Dolat Ventures, Inc., stock symbol 'DOLV', and Fox Petroleum, Inc., stock symbol 'FXPT', the U.S. Department of Justice release said.

According to court documents, Heaphy's "numerous misrepresentations induced investors to purchase securities, thus causing the share price of the securities to become artificially inflated. Certain of Heaphy's co-conspirators then sold their own preexisting positions in the securities at a profit. They then allowed he price of the securities to fall, leaving investors with worthless and unsalable stock. As a result, victim investors lost millions of dollars," Daly's release stated.

Heaney, according to court documents received approximately 25 percent of all money that he persuaded individuals to invest.

He was able to disguise the income by having the funds flow through trust accounts of various attorneys into bank accounts in the name of various shell entities under his control, the court documents stated.

His failure to pay taxes on this income resulted in a loss of $147,345 to Internal Revenue Service, the court documents said.

Heaphy pleaded guilty to one count of conspiracy to commit mail and wire fraud, which carries a maximum term of imprisonment of 20 years, and one count of tax evasion, which carries a maximum term of imprisonment of five years, Daly said.

He is scheduled to be sentenced by U.S. District Judge Jeffrey A. Meyer on October 20, 2017.

At sentencing, Heaphy said, will be ordered to pay restitution to his victims, as well as back taxes, interest and penalties to the Internal Revenue Service, Daly said.

Attorney for Heaphy, Brian Spears of Spears Manning LLC in Connecticut, said he had no comment.

The ongoing investigation is being conducted by the Federal Bureau of Investigation, Internal Revenue Service – Criminal Investigation Division and U.S. Postal Inspection Service, with assistance from the Connecticut Department of Banking and the Hartford and Stamford Police Departments.

Citizens with information that may be helpful to the ongoing investigation, or who believe they may have been victimized by this scheme, are encouraged to contact the FBI at (203) 777-6311.