Law & Justice

Area Man Charged In Microcap 'Pump and Dump' Stock Manipulation Scheme


NEWARK, NJ - Acting U.S. Attorney William E. Fitzpatrick announced that the owner of a purported business consulting firm was arrested today for operating a $1.1 million scheme that artificially inflated the stock price of a publicly traded company he controlled.

According to the announcement, Springfield resident, James Farinella, 46, is charged with one count of securities fraud.  He was scheduled to appear Wednesday June 21 at 2:30 p.m. before the U.S. Magistrate Judge Leda D. Wettre in Newark federal court.

The maximum potential penalty for the securities fraud count is up 20 years in prison and a $5 million fine per the complaint. 

Sign Up for E-News

According to the complaint: 

From June 2012 through December 2012, Farinella and others allegedly operated a “pump-and-dump” stock manipulation scheme to fraudulently inflate the prices of Pazoo Inc. (PZOO). Pazoo had little or no real business operations, and when it started trading in June 2012, Farinella controlled 98 percent of the free-trading shares in Pazoo.

Farinella and other conspirators allegedly “pumped” the price of those shares by orchestrating a series of trades between accounts they controlled to create the appearance that Pazoo stock was rising in price and heavily traded. In order to further inflate the prices, Farinella and his conspirators also disseminated misleading promotional materials to lure investors to purchase the stocks, including touting Pazoo as a leading provider of nutritional supplements for people and their pets.

After pumping the stocks, Farinella and his conspirators “dumped” them by selling large volumes of the stock to investors at artificially inflated prices. The companies’ stock prices then dropped, causing victims of the scheme to suffer losses. The alleged stock manipulation scheme generated approximately $1.1 million in gross trading proceeds.        

The securities fraud count carries a maximum potential penalty of 20 years in prison and a $5 million fine.

The charge and allegations in the complaint are merely accusations, and the defendant is considered innocent unless and until proven guilty.

The U.S. Securities and Exchange Commission (SEC) is filing a civil complaint against Farinella today.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation. He also thanked the U.S. Securities and Exchange Commission’s New York Regional Office, under the direction of Andrew Calamari, for its assistance in this matter.

The government is represented by Assistant U.S. Attorney Justin S. Herring of the U.S. Attorney’s Office Economic Crimes Unit in Newark.

TAP Into Another Town's News:

You May Also Be Interested In

Sign Up for E-News


Upcoming Events


Fri, March 23, 8:00 PM

17 Kent Place Boulevard, Summit

Open Mic Night

Arts & Entertainment


Sat, March 24, 2:00 PM

Summit Free Public Library, Summit

Gr. K-5: Saturday Serendipity

Arts & Entertainment Education

Summit Fire Department Blotter

01/01/2018 9:26 am     FD dispatched to a motor vehicle accident, car vs. pole in front of 196 GLENSIDE AVENUE.  On arrival occupant was out of the vehicle.  Summit EMS assumed patient contact. FD made notification to the power company to make repairs.  Summit PD remained on scene for traffic control and road closure until repairs were made.

01/02/2018 7:36 pm ...

Summit Police Blotter

March 12, 2018

3/3 - Daniel T. Lipkin, 20, of Millington was arrested and charged with possession of marijuana, possession of paraphernalia and possession of an alcoholic beverage under legal age. Mr. Lipkin was processed and released with a pending court date.

3/3 - Taurino Alday-Benitez, 28, of Summit was arrested and charged with driving while intoxicated. Mr. Alday-Benitez was processed and released with ...

Discover Your Inner Ballet Dancer at 'The Y'

March 22, 2018


This 8-WEEK class will be focusing on the classical technique of ballet in a fun and easy to understand manner. You can expect a full ballet class experience from working at the ballet barre, to leaping across the floor! No experience is necessary to participate. Easy to move in clothes, and socks or ballet shoes are recommended.


Coping with Behavioral Changes in Alzheimer's Disease Information Session Apr. 3

Behavioral changes in Alzheimer’s disease and other forms of dementia can pose concerns for family caregivers. As the disease progresses, behavior often becomes the primary way people with the disease communicate their needs.

Learn why people with Alzheimer’s disease and other forms of dementia experience behavior changes, what those behaviors mean, and how to cope when ...

Financially Savvy Charitable Giving: Donor-Advised Funds

Americans are known to be philanthropic, with an estimated 83% donating to charitable causes. Making the donation convenient and tax-effective is a win-win for both charities and those with a generous heart. Donor-advised funds (DAFs) are a simplistic funding structure available to those with both small and large charitable giving pots.  

Mechanics of Donor Funds

DAFs can be set up ...


AtlantiCast: Episode 13

On this episode of AtlantiCast, new clinical studies in the fields of cardiology and immunotherapy, national and statewide recognitions for Atlantic Health System medical centers and the inaugural AtlantiCast Collab Challenge!


Coffee, Tea or Fleas?

Two ducks are on a flight to Miami.  The first duck says to the second, “you flying south for the winter?”  The second duck replies, “Oh wow, a talking emotional support duck!”


Pa rum pum.


There have been a lot of news stories lately about animals traveling on airplanes.  Some are humorous, like the woman who recently tried to bring ...

Library = Learning

The library has always been a learning place. Generations of Summit students -- from first grade through college -- have come here to do research for school assignments, using resources ranging from the World Book Encyclopedia to the latest online databases.

There are learning opportunities for adults, too.

The Great Courses series offer college courses in CD, DVD, or digital ...