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FRTD and CEO Thomas Parilla Finally Charged By SEC

March 3, 2016:  At long last, and as we long ago prognosticated, the SEC announced litigation against Fortitude Gaming (FRTD) and it's CEO Thomas Parilla, alleging fraud for the purposes of running a Pump & Dump scheme.  The action comes almost two years after trading in FRTD was suspended by the regulator, citing concerns for the accuracy of statements made by the company.  It is those statements that underlie the charges announced today.

Among the allegations, the SEC states that the defendants " falsely characterized Fortitude’s purported efforts to enter into the burgeoning legal marijuana business space", including making phony statements regarding non-existent marijuana partnerships and operations, as well as lying about a Discover Card branded debit card.

   » Related: Fortitude Group Bag Holders Have Little Reason to Hope As Thomas Parilla & Company Show The Way to the Cliff

Michael Osborn
The company is also accused of making false misrepresentations about revenues. Within financial disclosures, there were claims of income from various sources including, a website run by convicted felon and recidivist fraud artist Michael Osborn. Osborn was indicted in 2015 for wire fraud and other crimes unrelated to the FRTD scheme. Court records show that Osborn has recently changed his plea to guilty for those charges in a deal that requires his cooperation in other federal criminal cases. It is unknown whether this includes his testimony in the FRTD case, but the timing would seem to indicate so. Details of the plea agreement were provided in an article written by penny stock fraud activist and long-time Osborn adversary, George Sharp.

Jehu Hand
It is also possible that the charges are the result of cooperation by former FRTD corporate counsel, Jehu Hand, who was himself indicted for securities fraud late last year. Osborn and Hand are long time partners-in-crime, going back almost 20 years.

   » Related: Pump & Dump Superstar Attorney, Jehu Hand, Indicted & Arrested

While indictments have not yet been announced in the FRTD matter, we would not be surprised to hear of them imminently, as criminal prosecution generally accompanies SEC civil accusations of this magnitude.