Former Newbridge Securities Corp. broker Gerald "Jerry" John Cocuzzo pleaded guilty in federal court to securities fraud and a $131 million market manipulation scheme involving ForceField Energy Inc. (NASDAQ: FNRG), a Nevada corporation and stock that at one point, according to SEC documents, was allegedly touted as a "great investment" on the Fox Business Network's "Varney & Co." show by a person who secretly was receiving kickbacks in exchange for promoting the FNRG product.
In a November release, the Department of Justice said the fraudulent scheme in which Cocuzzo and several other co-defendents profited by selling investors "worthless stock" FNRG caused a loss of approximately $131 million to investors.
Newbridge terminated Cocuzzo (CRD #4047511) in May 2016 after his indictment from the US District Court; Cocuzzo has racked up 14 disclosures over the course of his securities career, including a pending SEC civil action from May in which the Commission announced fraud charges against Gerry Cocuzzo and nine others involved in at least three schemes—the most recent of which ran through April 2015—to defraud and trick investors into buying shares of ForceField Energy stock.
The Commission said that ForceField never filed a registration statement in connection with any of its security offerings, including private placements of common stock, warrants, debentures, and promissory notes that raised $19.7 million from investors around the country.
The SEC's May action paralleled a US Attorney's Office decision to file criminal charges against 10 individuals, including Cocuzzo. The other individuals implicated in the SEC's May complaint include ForceField Energy then-chairman of the board Richard St. Julien, investor relations professional Jared Mitchell, newsletter publisher Christopher F. Castaldo, and registered representatives Richard Lyndon Brown (CRD #1436594), Cocuzzo, Naveed "Nick" Ahktar Khan (CRD #4615944), Maroof Miyana (CRD #4513966), and Pranav V. Patel (CRD #5391213), along with unregistered brokers Herschel C. Knippa and Louis F. Petrossi.
According to the SEC's complaint against Cocuzzo and the other nine defendants, St. Julien and/or ForceField Energy tried to conceal their illegal conduct by going through a company in Belize to pay kickbacks to Mitchell, who in turn withdrew the payments and paid cash bribes to the registered reps, including Cocuzzo. The SEC held that none of the registered representative defendants disclosed this compensation arrangement to their customers.
The complaint alleged that publisher Castaldo "lured his victims to invest in ForceField through a nationwide cold calling campaign" as well as in the Wall Street Buy Sell Hold, Inc. (WSBSH) investment newsletter (again, without accurately disclosing his compensation), while Knippa purportedly appeared on Fox Business Network's "Varney & Co." and the Business News Network to tout ForceField as a great investment, without disclosing that he was being paid to solicit investors for ForceField.
Several pending disputes in Cocuzzo's BrokerCheck file allege overconcentration, fraud, negligent supervision, and breach of fiduciary duty. A past dispute since settled alleged unsuitability, while several of Cocuzzo's co-defendants are also facing customer disputes related to the ForceField Energy sales (for instance, Patel is accused of selling $62,855 of ForceField Energy to five clients and subsequently claiming $2,144 in compensation away from the firm by agents of the issuer).
If you have invested with Gerald John Cocuzzo, the other registered representative defendants named in the fraudulent ForceField Energy Inc. scheme, or with any broker or financial adviser whose undisclosed kickbacks, compensation, or other fraudulent conduct in connection with touting a worthless stock or product has proven harmful to your investments or interests, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for investigation and consultation.