UPDATE 1-U.S. SEC charges man they say is behind the CYNK Technology fraud

(Updates with details about the case, background on CYNK and
prior arrest of another suspect)
By Sarah N. Lynch
WASHINGTON, July 31 (Reuters) - The U.S. Securities and
Exchange Commission filed civil fraud charges on Friday against
a man they say is behind a pump-and-dump scam involving CYNK
Technology CYNK.PK , a penny stock company that briefly rose to
a $6 billion value despite having no revenue.
The SEC said that Phillip Thomas Kueber, 54, filed a false
and misleading registration statement for the company, and then
enlisted a small group of "straw" shareholders and "sham CEOs"
to conceal his control of the company's non-restricted shares.
In truth, the SEC said these shareholders were actually his
family members and the shares were really transferred to
brokerage accounts and offshore shell companies he controlled.
The SEC added that Kueber failed in his attempts to cash in
the stock, however, after the SEC suspended trading in CYNK on
July 11, 2014, amid the suspicious trading activity.
The SEC said Kueber is a Canadian citizen, and sometimes
goes by the names Phil Thomas, Philip Thomas and Philip Keeber.
Reuters could not immediately locate a telephone number for
a Phillip Thomas Kueber in Canada. Kueber does not have any
known defense counsel.
Penny stock companies are often hijacked by fraudsters who
seek to pump up the stock with phony press releases so they can
quickly dump it before the price plummets.
CYNK grabbed headlines last year because its value
skyrocketed despite having no revenue and being listed as a
"development stage" company.
At one point during the stock's rally, shares rose more than
20,000 percent in a matter of weeks, hitting an intraday high of
$21.95 on July 10, 2014.
This marks the second person the SEC has charged in
connection with the alleged CYNK fraud.
In June, Gregg Mulholland was arrested and charged with
securities fraud and money laundering conspiracies in connection
with CYNK and other public companies.
At that time, the SEC also filed parallel civil charges
against Mulholland.