Financial Fraud: Eight Defendants Indicted For Participating In Three Unrelated Securities Fraud Crimes



Financial Fraud
Eight Defendants Indicted for Stock Fraud-Related Offenses

Eight Defendants Indicted for Stock Fraud-Related Offenses

Assistant U. S. Attorneys Aaron P. Arnzen (619) 546-8384 and Andrew J. Galvin (619) 546-9721

SAN DIEGO – Eight people, including a San Diego lawyer, were indicted by a federal grand jury for participating in three unrelated securities fraud crimes.

Arrests by the FBI began on July 5, 2018, and culminated July 11, 2018 when Luke Zouvas of Point Loma was taken into custody. Zouvas was charged with laundering money he believed to be proceeds of stock fraud schemes. According to court records, Zouvas was contacted by a former business associate for whom he had previously laundered stock fraud proceeds. In exchange for a money laundering fee, Zouvas agreed to pick up where the two left off years ago by funneling over $500,000 through his law firm’s client trust account.

In another indictment, Gannon Giguiere of Laguna Beach, California, was charged with manipulating the market for the stock of Eco Science Solutions, Inc. and Kelvin Medical, Inc. According to court records, Giguiere conspired to pump up the price and volume of these stocks through manipulative trading and/or a stock promotion website designed to get innocent investors interested in buying the stock. After the stock prices rose and he dumped the shares, Giguiere pocketed more than $10 million in fraudulent proceeds from these schemes. The same indictment charges Oliver Lindsay of Grand Cayman with participating in the Kelvin Medical scheme, including by trading the conspirators’ stock through an offshore brokerage account in the Cayman Islands.

Another indictment charges a group of five individuals with manipulating the market for the stock of Arias Intel, Corp. According to court records, this scheme included efforts to artificially inflate the price and volume of Arias Intel’s stock by controlling the majority of the company’s free-trading shares through concealed offshore accounts, coordinating press releases with expected stock promotions, and the use of high-pressure call rooms targeting innocent investors. Each of the five defendants – Andrew Hackett of Toronto, Canada; Vikram Khanna of Porter Ranch, California; Kuldeep Sidhu of Vancouver, British Columbia; Annetta Budhu of New York, New York; and Kevin Gillespie of Tampa, Florida – spoke on recorded calls about various aspects of their scheme.

“These fraud schemes victimize all investors and compromise the integrity of our financial markets,” said U.S. Attorney Adam Braverman. “We are committed to holding accountable those who try to manipulate the system for their own profit.”

“For the United States to maintain its vibrant economy, the American people must have trust and confidence in our markets,” said FBI Special Agent in Charge John Brown. “The FBI will continue to aggressively pursue these complex and coordinated fraud schemes in order to protect the American people and our economy.”

Giguiere has been released on a $2 million dollar bond. Sidhu has been detained pending trial. Motions to detain Lindsay and Hackett will be heard on July 17 and 19, 2018, respectively. Budhu and Gillespie made their first appearances in the Southern District of California on July 13, 2018, and Khanna will make his first appearance on July 27, 2018.

The Securities and Exchange Commission has also taken action against Giguiere, Lindsay, Gillespie, Budhu and Hackett.

DEFENDANTS

Case Number 18cr3071-WQH

Gannon Giguiere Age: 46 Laguna Beach, CA

Oliver Lindsay Age: 44 Georgetown, Grand Cayman

SUMMARY OF CHARGES

Conspiracy – Title 18, U.S.C., Section 371

Securities Fraud – Title 15 U.S.C., Sections 78j(b), 78ff; and 17 C.F.R., Section 240.10b-5

Maximum penalty: 20 years’ imprisonment and $5,000,000 fine

Case Number 18cr3072-BTM

Andrew Hackett Age: 29 Toronto, Canada

Vikram Khanna Age: 53 Porter Ranch, CA

Kuldeep Sidhu Age: 47 British Columbia, Canada

Annetta Budhu Age: 53 New York, NY

Kevin Gillespie Age: 49 Tampa, Florida

SUMMARY OF CHARGES

Conspiracy – Title 18, U.S.C., Section 371

Securities Fraud – Title 15 U.S.C., Sections 78j(b), 78ff; and 17 C.F.R., Section 240.10b-5

Maximum penalty: 20 years’ imprisonment and $5,000,000 fine

Case Number 18cr3070-JLS

Luke Zouvas Age: 47 San Diego, CA

SUMMARY OF CHARGES

Money Laundering – Title 18 U.S.C., Section 1956(a)(3)(B)

Maximum penalty: 20 years’ imprisonment and fine equal to value of the funds involved in the transaction.

AGENCY

FBI (lead agency)

Securities and Exchange Commission

Criminal Prosecution Assistance Group, Financial Industry Regulatory Authority

Financial Industry Regulatory Authority

The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.

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