SEC Charges Virginia Man in Fitbit Pump and Dump Scheme

US charges Virginia man in Fitbit stock hoax

US charges Virginia man in Fitbit stock hoax

A USA man has been arrested and charged in connection with a $100 million stock manipulation involving shares of the wearable technology maker Fitbit, federal prosecutors announced Friday.

Just minutes before submitting the fake tender offer, Murray allegedly bought call options which he then sold after the share price temporarily spiked, creating a $3,100 profit for Murray.

Murray allegedly bought call options for Fitbit stock around November 9, 2016, and then sold the options for a profit after the "sham tender offer" moved the company's shares, according to the complaint.

Murray was arrested in Virginia and will be brought to federal court in Manhattan on Friday.

The SEC's complaint charges Murray with violating antifraud provisions of the federal securities laws, including Section 17 (a) of the Securities Act of 1933 and Sections 10 (b) and 14 (e) of the Securities Exchange Act of 1934, and Rules 10b-5 and 14e-8. According to the SEC's complaint, it appeared as though the system was being accessed from a different state by using an IP address registered to a company located in Napa, California.

They also said Murray prepared for his scheme by studying two recent market manipulation cases involving hoax takeover bids. The SEC appreciates the assistance of the U.S. Attorney's Office for the Southern District of NY and the U.S. Postal Inspection Service. -Bulgarian citizen criminally charged in March 2016 over bids for Avon Products Inc and Rocky Mountain Chocolate Factory Inc, and Nauman Aly, a Pakistani man charged wth fraud by the SEC last May over a bid for chipmaker Integrated Device Technology Inc.

Fitbit was not accused of wrongdoing, and did not immediately respond to a request for comment.

The U.S. Attorney's Office for the Southern District of NY also filed criminal charges against Murray.