Billionaire Pickens' Son Pleads Guilty In NYC Court To Fax Scam
Monday, October 30th 2006, 8:26 pm
By: News On 6
NEW YORK (AP) The son of billionaire oil tycoon T. Boone Pickens pleaded guilty to securities fraud Monday, admitting his role in a scheme to inflate the stock value of three companies so he could make hundreds of thousands of dollars illegally.
Michael O. Pickens, of Nocona, Texas, entered the plea in U.S. District Court in Manhattan after signing an agreement calling for him to be sentenced to as little as four years and nine months in prison or as much as five years and 11 months.
Judge Loretta A. Preska set sentencing for January 30th after Pickens, 52, entered the plea to three charges of securities fraud. The charges carry a potential fine of $3 million.
Pickens was arrested July 18, 2005, and was accused of sending hundreds of thousands of hoax faxes throughout the United States in December 2004 to fraudulently induce investors to buy three stocks.
Prosecutors said each fax purported to be a handwritten note conveying a stock tip to a person, suggesting it had been mistakenly sent to each recipient. An indictment said the fake faxes caused the trading values and market prices of the stocks to increase dramatically; it said one stock's value almost doubled in one day.
In one fake note, a financial planner identified as Chris tells a Dr. Mitchel that his newest stock idea will be like the last one, which tripled in value.
The government, which didn't say how many people acted on the phony faxes, said Pickens used the faxes from December 17-22, 2004, to pump up the price of three stocks so he could sell them at a premium of hundreds of thousands of dollars.
Pickens told the judge ``the faxes were made to appear as a misdirected tip from a stock broker to a customer. In fact, as I knew, there was no broker, no customer and no tip.''
He added: ``I knew at the time what I was doing was wrong, and I'm very sorry for my conduct.''
During his plea, Pickens, a Texas stock promoter, said he has been undergoing treatment for substance abuse since June.
A spokesman for T. Boone Pickens, Jay Rosser, said: ``Mr. Pickens is proud of Mike for accepting responsibility for his actions. This is an important step and a significant milestone. Boone and his whole family are fully supportive of him in his rehabilitation efforts.''