A Houston businessman has been sentenced for conspiring to commit wire fraud, United States Attorney Kenneth Magidson announced. James Roland Dial, 56, of Houston, just landed a five-year-term of imprisonment at a hearing that concluded moments ago in Houston.
Dial pleaded guilty to the offense on March 4, 2011, admitting he conspired
with Evan “Nick” Jarvis, 39, of Magnolia, Texas; and Alex Ellerman, 36, of
Chicago, to enrich themselves between 2004 and 2007 by artificially inflating
the stock price of a publicly traded company called Grifco International Inc.
(Grifco). Grifco manufactured oil field drilling equipment, and Dial was
Grifco’s CEO. Dial admitted knowing that Grifco issued a press release to the
public on March 3, 2005 containing false information about Grifco’s revenue and
net income and that he willfully and knowingly profited from the false press
release by selling Grifco stock to the public at an inflated price. The stock
ultimately became worthless.
Approximately 300 investors who had purchased Grifco stock submitted impact
statements to the court for consideration at Dial’s sentencing today. Several
victims noted they had lost their life savings because of the fraud. Senior U.S.
District Judge David Hittner, who accepted the guilty plea and presided over the
hearing today, handed Dial a five-year prison sentence, to be followed by three
years of supervised release. Judge Hittner also ordered Dial to pay restitution
to his victims. A hearing to determine the amount of such restitution will be
held within the next 90 days.
Jarvis and Ellerman pleaded guilty to conspiring with Dial and will be
sentenced on June 1, 2012. Jarvis had been permitted to remain on bond pending
his sentencing hearing but was taken into custody on May 3, 2012 for violating
conditions of his bond, where he will now remain. Ellerman has been in custody
since April 20, 2010 when he was arrested at George Bush Intercontinental
Airport upon returning to the United States after a lengthy stay in Panama.
The two-year investigation leading to the charges was conducted by the FBI,
with the assistance of the Harris County District Attorney’s Office. The U.S.
Securities and Exchange Commission has conducted a parallel investigation.
Assistant U.S. Attorney John R. Lewis is prosecuting the case.
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