Fremont Tech CEO Sentenced In Stock Fraud
FREMONT (CBS/AP) - The former CEO of a Fremont technology firm has been sentenced to 21 years in federal prison in a multimillion-dollar stock fraud scheme.
The sentence against Pegasus Wireless Corp. chief Jasper Knabb, issued by a judge on Thursday, was more than three times greater than what prosecutors were recommending.
But U.S. District Judge Jeffrey White said Knabb had concealed funds and could not be trusted.
Prosecutors said the 46-year-old Knabb fabricated documents starting in 2005 to give the false impression that the communications equipment manufacturing company had outstanding debt. They say he then had Pegasus issue more than 490 million shares to cover the phony debt and profited when the shares were sold.
Knabb pleaded guilty in July to securities fraud and conspiracy. He has been ordered to repay $40.8 million.
Pegasus's former chief financial officer, Stephen Durland, has also been sentenced in connection with the scheme.
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