BAR HARBOR, Maine — A local taxicab owner and driver accused of being involved in a “pump and dump” stock scheme worth hundreds of millions of dollars was arrested this week by local police on an extradition warrant out of New York City.
Joseph Dervali, 54, of Bar Harbor and Pembroke Pines, Florida, was taken into custody Monday after local police found him while he was driving his cab around town, according to Bar Harbor police Sgt. David Kerns. Dervali owns and operates Cadillac Joe’s Island Transportation LLC.
Kerns said the New York City Police Department tried finding Dervali in Florida but learned he was in Maine for the summer tourist season and contacted Bar Harbor police. New York authorities were looking for Dervali after he was indicted in New York last week.
According to an official at the Hancock County Jail, Dervali was being held at the Ellsworth jail as of Friday afternoon.
Dervali and seven others were indicted Sept. 11 in New York on charges they duped thousands of investors into purchasing $290 million worth of penny stocks in “pump and dump” schemes.
Three of the people blasted emails “pumping” the stocks to thousands of potential investors, Manhattan District Attorney Cyrus Vance Jr. said in a statement released last week announcing the 85-count indictment.
Others acquired public shell companies, merged new private companies into them and issued shares to themselves and associates in advance of the promotional push, prosecutors said.
Once the stock’s price was artificially inflated, the schemers “dumped” the stock, leaving public investors with shares that were pretty much worthless, the prosecutors said.
Anthony Thompson, 38, of Bethesda, Maryland, and Jay Fung, 40, of Delray Beach, Florida, were arraigned in state Supreme Court in Manhattan in connection with the scheme, which prosecutors said took place between 2009 and 2012. They pleaded not guilty to securities fraud and other charges.
The pair are accused of promoting the stocks with the help of penny stock websites prosecutors say they controlled, including oxofwallstreet.com, pennypic.com and monsterstox.com.
Hanna Schmieder, 39, of New York and Kenneth Oxsalida, 59, of Sebring, Florida, also were arraigned and pleaded not guilty.
Schmieder, president of Lyric Jeans Inc., and Oxsalida, 59, president of Smart Holdings Inc., are accused of approving new shares in anticipation of the stock manipulation of their companies.
Along with Dervali, prosecutors last week were still trying to find three other people accused in the scheme: Christopher Balseiro of North Bay Village, Florida; Eric Van Nguyen of Quebec; and Luz Rodriguez of Miramar, Florida. Information about whether Balseiro, Nguyen and Rodriguez have been found was unavailable Friday afternoon.
Maranda Fritz, a lawyer for Thompson, said the documents emailed to potential investors clearly stated they were paid in advertising. Vance said in a statement the accused profited “at the expense of the investing public.” Other companies involved included Hydrogenetics Inc., Xynergy Holdings Inc., Blast Applications Inc. and Blue Gem Enterprise Inc.
BDN writer Bill Trotter contributed to this report.