Wednesday, September 23, 2009

Dan Laikin Pleads Guilty To Stock Price Manipulation

The former CEO of National Lampoon, Inc., Daniel Laikin, pleaded guilty in a federal court in Philadelphia today to charges he conspired with others to manipulate the price of National Lampoon's shares. PRNewswire explains Laikin's crime:

As part of this conspiracy, Laikin enlisted a number of other individuals to help him artificially inflate the price of the stock. Specifically, Laikin paid kickbacks to individuals to generate buying in the stock, that was not based on free market forces, to make it appear as if there was significant interest in the stock when, in fact, there was little or no such interest. Laikin also provided non-public information to his co-conspirators, including information regarding the company's unannounced financial results. He also coordinated press releases to provide a pretext for their increased buying. Laikin's goal was to induce real buying from the public so as to artificially increase the price of the stock. As part of his plea, Laikin acknowledged that he intended to cause between $2.5 million and $7 million in losses through this scheme.

Laikin faces up to five years in prison, three years of supervised release, a $250,000 fine, and a $100 special assessment when sentenced on Jan. 13, 2010. Laikin also faces separate civil charges from the United States Securities and Exchange Commission.

The case was investigated by the FBI and the United States Securities and Exchange Commission. It is being prosecuted by Assistant United States Attorneys Derek A. Cohen and Louis D. Lappen.
Indianapolis businessman and National Lampoon shareholder/officer Tim Durham took the reins of the company following Laikin's indictment last year. A shareholder derivative suit was brought earlier this year in connection with another Durham-controlled company, CLST Holdings, which accused him and two of his business partners of self-dealing. Laikin's brother, Robert, is CEO of Indianapolis-based Brightpoint.

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