A former stock promoter has pleaded guilty to conspiring to break mail and wire fraud laws and to obstructing a government probe of alleged stock manipulation involving two Utah-born companies.
Henry Lorin, 47, of New York City pleaded guilty to two counts of conspiracy and obstruction. He faces a maximum sentence of 10 years in prison and a $500,000 fine.Lorin is accused of conspiring with Eugene Laff, former chairman of the now-defunct Haas Securities Corp., and Stanley Aslanian Jr., the brokerage's former president, to manipulate the prices of three over-the-counter stocks.
Two of those - T S Industries and Big O Tires Inc. - started out as Utah blind pool corporations. A blind pool is a public company where investors don't know what their money will be invested in.
The third company was Flores de New Mexico Inc.
Lorin also admitted that he gave false testimony to the Securities and Exchange Commission in July 1987.
Laff was indicted last month on 15 counts of conspiracy, securities and mail fraud and obstructing a government investigation. Aslanian has agreed to plead guilty to participating in the manipulation conspiracy.
Haas, which was a market maker in the manipulated stocks, collapsed after the market crash in October 1987.
The charges against the three men stem from the government's investigation of penny-stock fraud. Penny stocks are low-priced securities often selling for as little as a few cents a share.
Early this year the government said it had been conducting an inquiry into stock manipulation using evidence that came to light after the October 1987 market crash. Prosecutors said they had uncovered a number of manipulation schemes that had been going on for years.