NEW YORK, United States, Wednesday May 18, 2016 –The secret owner of an offshore broker-dealer and investment management company based in Panama and Belize has admitted to running a scheme that saw him laundering more than US$250,000 in profits through at least five offshore law firms.
Gregg Mulholland, 46, owner of Legacy Global Markets S.A., on Monday pleaded guilty to money laundering conspiracy for fraudulently manipulating the stocks of more than 40 US publicly-traded companies and then laundering the money. He now faces up to 20 years in prison.
The dual American and Canadian citizen “used offshore shell companies in Belize and the West Indies to carry out numerous schemes”, according to court documents.
Mulholland made a plea deal with the government, and has agreed to forfeit, among other things, a Dassault-Breguet Falcon 50 aircraft, a Range Rover Defender vehicle, two real estate properties in British Columbia, and funds and securities on deposit at more than a dozen bank and brokerage accounts.
Prosecutors said that between 2010 and 2014, Mulholland controlled a group of individuals (the Mulholland Group) who together devised three interrelated schemes to: induce US investors to purchase stock in various thinly-traded US public companies through fraudulent promotion of the stock, concealment of their ownership interests in the companies, and fraudulent manipulation of artificial price movements and trading volume in the stocks of those companies; circumvent the IRS’s reporting requirements under the Foreign Account Tax Compliance Act (FATCA); and launder the fraudulent proceeds from the stock manipulation schemes to and from the United States through five offshore law firms.
To facilitate the interrelated schemes, the Mulholland Group used shell companies in Belize and Nevis, which had nominees at the helm. This structure was designed to conceal the Mulholland Group’s ownership interest in the stock of US public companies, in violation of US securities laws, and enabled the Mulholland Group to engage in more than 40 “pump and dump” schemes.
Mulholland used the services of a US-based lawyer to launder the money – directing the fraud proceeds to five law firm accounts and transmitting them back to members of the Mulholland Group and its co-conspirators.