Trading in ForceField Energy has now been suspended for at least two weeks.
On Monday, shares of ForceField tanked, falling more than 20%, before being halted after the LED lighting company disclosed that its chairman, Richard St. Julien, was arrested on Friday and resigned on Sunday.
The stock didn’t re-open, and now won’t be back for at least a couple weeks.
In a release on Tuesday morning, the SEC announced that trading in ForceField shares would be suspended until at least May 5. The SEC suspended trading in shares, “due to concerns about the adequacy and accuracy of information available to investors concerning the funding of recent articles and promotions touting [the company].”
This news from the SEC follows a Monday release from the Department of Justice that said St. Julien was arrested for securities fraud in Florida as he was attempting to board a flight to Costa Rica.
ForceField’s filing on Monday didn’t say whe he’d been arrested.
In its release, the DoJ said:
According to the criminal complaint unsealed [Monday] morning in Brooklyn federal court, since approximately August 2012, St. Julien and his co-conspirators engaged in a scheme to manipulate the price and trading volume of ForceField’s stock by using undisclosed nominee accounts, including an account held by a dermatologist in Boulder, Colorado, to purchase and sell the stock, and through the use of stock promoters and broker dealers who failed to disclose to potential investors that they had been paid by St. Julien to promote the purchase of the stock. St. Julien did not disclose his ownership and control of the shares purchased through nominees and used offshore banks, including in Belize, to pay the nominees to conceal his ownership and control. St. Julien coordinated the purchases by telephone and text messages.
The DoJ further added that St. Julien used “used backroom promoters and broker dealers” to boost ForceField’s stock price by 58%. St. Julien faces up to 25 years in prison if convicted.
ForceField, which has a market cap of $US59 million, saw shares rise about 35% in a year up through early last week. Shares of the company fell about 50% in a few days into the end of last week and including Monday’s plunge.