A Passaic County businessman admitted he stole more than $17 million through a years-long, sprawling market manipulation and tax fraud scheme, authorities said.
Joseph Taub, 41, of Clifton, pleaded guilty in federal court to securities fraud and conspiracy to defraud the United States, U.S. Attorney for New Jersey Craig Carpenito in a statement.
If his plea agreement is accepted by the court, Taub will be sentenced to 18 months in prison, forfeit $17.1 million and will be required to pay $394,424 to the IRS, the statement said.
Taub is scheduled for sentencing Dec. 1, 2020. His attorney was not immediately available for comment.
From 2014 to 2016, Taub, along with Sean Greenwald, an accountant from New York, and a crew of unnamed co-conspirators, would artificially inflate or lower securities prices by buying and selling shares. By influencing the prices of shares in the publicly traded companies, Taub would also provoke interest from other participants, making it appear there was real “market interest,” the statement said.
Greenwald, 40, of Cedarhurst, on Long Island, pleaded guiltyfor his part in February 2018 and is awaiting sentencing, the statement said.
The scheme involved brokerage accounts held both under Taub’s name and under the names of family members and business entities Taub and others in his crew controlled. At the time Taub and another co-conspirator were charged, the scheme netted them more than $26 million in 2014 and 2015 alone, the U.S. Attorney’s Office previously said.
By hiding the identities of those who actually controlled the straw accounts from brokerage firms and the federal Internal Revenue Service (IRS,) Taub defrauded the United States and avoided paying hundreds of thousands in taxes, the statement said.
The profits from the straw accounts were taxed at lower rates that applied to the account holders, instead of the rates that applied to Taub, the statement said.
Through this part of the scheme, Taub avoided paying $394,424 in federal taxes.