Bar Harbor Taxi Business Owner Indicted in Multimillion Dollar Penny Stock Scheme

Friday, September 26, 2014

The Bangor Daily News reports that Joseph Dervali, owner of a Bar Harbor-based taxi company, has been indicted for his alleged involvement in a stock manipulation scheme that defrauded investors of hundreds of millions of dollars.

It is alleged that Dervali, and others, between April 2009 and May 2012, promoted penny stocks while conspiring with individuals in control of public companies to “pump-and-dump” the companies’ stock. Dervali, and others, allegedly controlled numerous penny stock websites, from which they promoted the sale of the stocks to thousands of investors.

These individuals, including Dervali, allegedly acquired public shell companies with which to issue millions of shartes to themselves, associates and family members, in order to control the supply of those shares and drive up the price of the stock. Potential investors were encouraged to purcahse shares. As demand and the price of shares rose, they allgedly "dumped" their shares, causing the stock price to plummet leaving investors with nearly worthless investements.

Dervali was recently arrested by Bar Harbor police at the request of New York City Police. He was extradicted to New York where he plead not guilty to eight counts of scheming to defraud in the first degree and four counts of violating the Martin Act.

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