U.S. regulators have charged a Canadian with securities fraud, alleging that he masterminded a scheme to secretly control the stock of a microcap company.

The U.S. Securities and Exchange Commission (SEC) has charged Phillip Thomas Kueber in a complaint filed in U.S. District Court for the Eastern District of New York. The charge alleges that Keuber carried out a scheme to conceal his control and ownership of a microcap company, Cynk Technology Corp. The SEC’s complaint alleges that Kueber violated the anti-fraud provisions of federal securities laws and its own anti-fraud rules. The allegations have not been proven.

In its complaint, the SEC alleges that Kueber was behind a false and misleading registration statement filed by Cynk. It also claims that he enlisted a small group of dummy shareholders and sham CEOs to conceal his control of Cynk stock.

The complaint alleges that the “shareholders,” which were mainly Kueber’s family members and associates in British Columbia and California, never received the shares they purportedly purchased. Instead, the SEC claims, Kueber transferred the shares to brokerage accounts and offshore shell companies he secretly controlled, and he allegedly misled broker/dealers about his ownership of the shares, to create the false appearance of a company with publicly held shares.

The SEC suspended trading in Cynk on July 11, 2014 amid suspicious activity in the company’s stock. As a result, it says, Kueber was prevented from profiting from the scheme.

“We allege that Kueber used straw shareholders, offshore dummy corporations and puppet corporate officers to gain and conceal control over the majority of Cynk shares,” says Michael Paley, co-chair of the SEC enforcement division’s microcap fraud task force, in a statement. “Law enforcement has again pierced through the layers of deceit to hold an alleged wrongdoer accountable, in this case before he could liquidate his shares in the open market and realize ill-gotten profits.”

The SEC is seeking to impose a civil monetary penalty, to bar Kueber from serving as a public company officer or director or participating in a penny-stock offering and for Kueber to be subject to a court-ordered injunction against future violations.