A former CEO is facing charges of stock fraud after his arrest last week, the US Attorney announced Tuesday.
Mark Lopez allegedly worked with a stock trader to manipulate the share price and volume of his company's stock.
Lopez was the president and CEO of Unico, Inc., a San Diego-based mining company, until June of last year.
He and his company are accused of issuing about 9 million shares of stock not regesitered with the Securities and Exchange Commission, the US Attorney alleges, causing existing shares to drop in value.
Prosecutors believe he got away with the crime by using a little-known loophole that allows companies to issue unregistered shares of stock to settle "bona fide" debts. Unico would get into debt by settling in sham lawsuits brought against them, US Attorney Laura Duffy said in a statement.
Lopez is also accused of obstructing a federal investigation into his actions by hiding emails in folders labled "Not Released to SEC Subpeona (Delete)."
If convicted, Lopez faces up to a total of 65 years in prison and $750,000 in fines.