Calif. man convicted in stock fraud with LI brokerage gets 5 years in prison

A Central Islip federal judge sentenced a California man to five years in prison Friday and ordered him to repay $8 million for conspiring with a Long Island boiler room brokerage to artificially inflate the price of stock and defraud elderly investors, prosecutors said.

Federal prosecutors said Lawrence Isen, 69, of San Diego, California, was a former registered broker, who was convicted of his role in a criminal conspiracy to promote stock shares. He was found guilty along with Jeffrey Chartier, 59, of Sunny Isles, Florida, after a six-week trial in March 2020 of conspiracy to commit securities fraud and wire fraud, fraud and money laundering. He was ordered to pay restitution and authorities also seized more than $700,000 in assets.

Chartier was sentenced last month.

Prosecutors said the two men worked together in a Melville boiler room from 2014 to 2016 to inflate the price of stock and trading in struggling companies and then offloaded it onto elderly and vulnerable victims.

The U.S. Attorney's Office for the U.S. Eastern District of New York said, “Isen colluded with crooked investors, both in the United States and overseas, to dump large volumes of shares.”

The stocks were traded in the Hydrocarb Energy Corp. and Intelligent Content Enterprises Inc.

Isen manipulated stock belonging to major Hydrocarb Energy shareholder Michael Watt and major Intelligent Content shareholders in India. Prosecutors said he connected investors with the boiler room and negotiated trades.

“Isen assisted the boiler room in its illegal cold call campaigns that used lies and high-pressure sales tactics to lure victims, by, among other things, transferring money and stock required by the boiler room for the campaigns; working with the boiler room to fill the duped victims’ orders with Isen’s crooked investors’ stock; and creating fraudulent stock purchase agreements, consulting agreements and invoices to cover up the illegal conduct,”  federal prosecutors said.

Prosecutors estimated the stocks were fraudulently inflated by more than $146 million, leading to 16 separate convictions.

Isen previously had been barred from acting as a broker in 1996 and convicted of wire fraud, conspiracy and obstruction of justice in 2000.

By John Asbury

john.asbury@newsday.comJohnAsbury

John Asbury is a breaking news and general assignment reporter. He has been with Newsday since 2014 and previously worked at The Press-Enterprise in Riverside, California.