Please E-mail suggested additions, comments and/or corrections to Kent@MoreLaw.Com.
Help support the publication of case reports on MoreLaw
United states of America v. Cary Lee Peterson
Case Number: 3:16-cr-00230-AET
Judge: Anne E. Thompson
Court: United States District Court for the District of New Jersey (Mercer County)
Plaintiff's Attorney: Ari Fontecchio and Zach Intrater
Defendant's Attorney: Eric J. Marcy
Trenton, NJ - Microcap Company CEO Sentenced to 52 Months in Prison for Securities Fraud
Falsely Claimed Millions in Revenue from Contracts with Foreign Countries
The chief executive officer of a publicly traded microcap company was sentenced to 52 months in prison for orchestrating a multimillion-dollar securities fraud scheme using false reports with the U.S. Securities and Exchange Commission, U.S. Attorney Craig Carpenito announced.
Cary Lee Peterson, 38, of Phoenix, Arizona, was previously found guilty of all three counts of an indictment charging him with two counts of false certification in SEC filings and one count of securities fraud. He was convicted following a two-week trial before U.S. District Judge Anne E. Thompson, who imposed the sentence today in Trenton federal court.
According to documents filed in this case and evidence presented at trial:
Peterson, as CEO of RVPlus Inc., filed numerous false reports with the SEC, including:
On Aug. 21, 2012, Peterson falsely certified on SEC Form 8-K that RVPlus had entered into a contract worth $1.8 billion with the Ministry of Environment for Katsina State within the Federal Republic of Nigeria to provide unspecified green energy products and services.
On Nov. 16, 2013, Peterson falsely certified on SEC Form 8-K that RVPlus had entered into a contract worth $90 million with the Commission of the Foreign Affairs to the Senate for the Republic of Haiti.
On Dec. 21, 2012, Peterson falsely certified on Form 10-Q that RVPlus held $8,653,846 in short-term accounts receivable for services rendered under the Nigeria agreement, despite prior warnings from RVPlus’ auditors that reporting these receivables as revenue was improper.
On Dec. 27, 2012, Peterson falsely certified on SEC Form 8-K that RVPlus had entered into a contract worth $10.5 million with the Federal Ministry of Planning & Economic Affairs for the Republic of Liberia.
On March 28, 2013, Peterson falsely certified on SEC Form 10-Q that RVPlus held $17,590,837 in short-term accounts receivable from, among other sources, the Haiti and Liberia agreements.
The SEC suspended trading in RVPlus on July 19, 2013, due to questions concerning the accuracy of RVPlus’ periodic financial filings, including reported accounts receivable, assets, and operations.
Peterson also claimed that ECCO2 Corp., a not-for-profit owned by Peterson was an “affiliate organization” of the U.N. Convention on Climate Change. Peterson claimed that “[t]his status held with the sectors of the United Nations opens many windows of opportunity to over $100 billion in financial aid to fund ECCO2 projects.” ECCO2 was never an affiliate of the U.N. Convention on Climate Change. In fact, the U.N. wrote to Peterson on two separate occasions demanding that ECCO2 stop claiming that it was.
In addition to the prison term, Judge Thompson sentenced Peterson to three years of supervised release and ordered him to pay restitution of $250,167.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, with the investigation. He also thanked FBI special agents under the direction of Special Agent in Charge John F. Bennett in San Francisco for their assistance with Peterson’s arrest, and the U.S. Securities and Exchange Commission’s New York Regional Office, under the direction of Regional Director Marc P. Berger and Senior Associate Regional Director Sanjay Wadhwa, for its assistance.
18:1350 FALSE CERTIFICATION (do 12/21/2012)
18:1350 FALSE CERTIFICATION (do 3/28/2013)
15:78j(b) and 78ff and Title 17, § 240.10b-5 SECURITIES FRAUD (do 5/2012-3/2013)
Outcome: Defendant was sentenced to 52 months in prison.