Prison Sen­tenc­ing

Hartford Courant - - Front Page - Diane Dalmy, pre­vi­ously sen­tenced for role in penny stock ma­nip­u­la­tion, lied on fi­nan­cial af­fi­davit By David Owens [email protected]

There’s new ac­tion in a stock ma­nip­u­la­tion scheme or­ches­trated by a Suffield man.

NEW HAVEN – A lawyer from Colorado who par­tic­i­pated in a penny stock ma­nip­u­la­tion scheme or­ches­trated by a Suffield man had two years added to her fed­eral prison sen­tence after author­i­ties learned she lied on a fi­nan­cial af­fi­davit.

Diane Dalmy, 63, of Den­ver, was re­sen­tenced Fri­day in U.S. District Court in New Haven. On May 15, U.S. District Judge Jef­frey A. Meyer sen­tenced Dalmy to three years in prison and or­dered her to pay $2 mil­lion in resti­tu­tion.

She had pre­vi­ously pleaded guilty to one count of con­spir­acy for her role in the crim­i­nal en­ter­prise that stole more than $19 mil­lion from 12,000 vic­tims through penny stock ma­nip­u­la­tion.

The scheme was headed by Chris­tian Meis­senn, 46, of Suffield, who was sen­tenced last week to three months in prison and three years of house ar­rest. The judge called Meis­senn a brazen crim­i­nal who made com­mit­ting fraud and be­ing a con artist a way of life.

Ac­cord­ing to the gov­ern­ment, Dalmy signed phony at­tor­ney opin­ion let­ters that falsely cer­ti­fied the le­git­i­macy of what are known as pump-and-dump penny-stock trans­ac­tions. She pre­vi­ously was barred from se­cu­ri­ties work by the fed­eral Se­cu­ri­ties and Ex­change Com­mis­sion for is­su­ing the same sort of let­ter in an ear­lier stock of­fer­ing and profit­ing from the re­sult­ing fraud.

Dalmy also ad­mit­ted that she al­lowed one of the other con­spir­a­tors to use her law firm trust ac­count to move money.

After her guilty plea and sen­tenc­ing to three years in prison in May, Dalmy tried to hide about $47,000 in cash by not in­clud­ing it on the fi­nan­cial af­fi­davit she was re­quired to file. For her “will­ful fail­ure to pay resti­tu­tion,” Meyer added two years to her sen­tence on Fri­day.

Corey Brin­son, a for­mer Hartford lawyer and city coun­cil­man, was con­victed of the same con­duct as Balmy and sen­tenced to three years in prison. He is al­ready out of prison.

In pump-and-dump schemes, con­spir­a­tors ac­quire blocks of stock in worth­less shell com­pa­nies and pitch the com­pa­nies to in­vestors as be­ing on the cusp of a com­mer­cial break­through, of­ten in fields such as rare earth min­ing or soft­ware de­vel­op­ment.

The stock ma­nip­u­la­tors used rigged stock trades, phony an­nounce­ments about busi­ness de­vel­op­ments — of­ten de­liv­ered to mil­lions of in­boxes by un­scrupu­lous in­ter­net spam­mers — and other fraud­u­lent means to pump up share prices of the stock, much of which they con­trol.

As share val­ues, which trade for pen­nies, rise rapidly, sales­men pitch the stocks to un­so­phis­ti­cated in­vestors. As val­ues peak, the con­spir­a­tors dump, or sell, their stock, caus­ing the value to col­lapse, and leav­ing unwitting in­vestors with worth­less shares.

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