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Man pleads guilty in internet securities fraud case
man has pleaded guilty to sending out more than 9 million junk email messages as part of a business scheme that defrauded investors of more than $US100,000.
At sentencing on October 6, K.C. Smith, 20, will face up to 20 years in prison and a $US5 million fine on each of two counts of securities fraud. He pleaded guilty yesterday in US District Court.
Earlier, Smith agreed to pay $US107,510 to settle a complaint with the Securities and Exchange Commission involving two internet scams he ran in 2002.
According to court records, in May 2002 Smith created a website for a fictitious enterprise called the Maryland Investment Club, which claimed to offer double-digit monthly returns on high-yield international tax-free investments.
Smith promoted the scam in about 6 million unsolicited bulk e-mail messages. According to the SEC, he received $US78,909 from 26 investors.
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