The U.S. Securities and Exchange Commission announced that a Toronto man has received a lengthy prison sentence and is being ordered to pay almost US$56 million in restitution for securities fraud.

The SEC reports that George Georgiou of Toronto was sentenced to 25 years in federal prison, followed by three years of supervised release, and he is ordered to pay US$55,832,398 in restitution by a judge in the U.S. District Court for the Eastern District of Pennsylvania, after he was convicted of securities fraud, conspiracy, and wire fraud in February, following a three week jury trial.

In the wake of that conviction, he faced a maximum sentence of 165 years in prison and $21.25 million in fines.

The SEC previously filed a civil injunctive action against Georgiou based on the same conduct. It was seeking a permanent injunction, disgorgement, prejudgment interest, civil penalties, and a penny stock bar against Georgiou. The commission’s action was stayed as the criminal case proceeded.

According to its complaint, from 2004 through September 2008, Georgiou, who controlled the publicly-traded stock of four microcap companies, manipulated the market for the purpose of artificially inflating each company’s stock price or to create the false appearance of an active and liquid market. In order to do so, he used many nominee accounts that he either directly or indirectly controlled at offshore broker-dealers and banks, and used a variety of manipulative techniques, including matched orders and wash sales, the SEC says.

IE