Yesterday, authorities arrested two Charleston, South Carolina stock promoters, who allegedly manipulated shares of a shell company. To their surprise, the business was secretly being controlled by federal investigators. Christopher R. Putnam and Christopher G. Nix are in custody, looking at charges of conspiracy to commit securities fraud. Bail was set at $50,000 each. Putnam and Nix have been prohibited from trading, promoting any stock, or traveling outside of South Carolina or Massachusetts, where the case is to be prosecuted.

According to court documents, the alleged fraud occurred from August 2012 and February 2012, involving a Boston-area startup named Amogear Inc. with the stock symbol AMOG but no shares listed on a major exchange.

According to the FBI, with an undercover agent briefly posing as the CEO of Amogear, Amogear stated to be a sports apparel company but was actually a shell business obtained and controlled by the FBI through a cooperating witness. Putnam and Nix engaged in a “pump and dump,” pumping false information over the internet and inflating the stock price. Subsequently, Putnam, Nix, and their associates dumped their shares at a profit.

If you or someone you know has lost money as a result of an investment, please contact Richard Frankowski at 888-741-7503 to discuss your potential legal remedies.