Oceanside's Galanis family is in trouble again for alleged stock market fraud. Yesterday (September 24), the Securities and Exchange Commission civilly charged some family members with manipulating the stock market. At the same time, the United States Attorney for the Southern District of New York unsealed a criminal indictment charging members of the family and their allies with similar fraudulent actions.
Defendant John Galanis, 72, is an Oceanside resident. Also charged are three of his sons, Jason, Derek, and Jared Galanis. The father lives in Oceanside, as does son Derek. Jason Galanis lives in Los Angeles and Jared Galanis lives in Baltimore. Gavin Hamels, who was also charged, lives in Encinitas.
The defendants took "tens of millions of dollars" from investors, according to the U.S. Attorney's office for the Southern District of New York.
From 2009 to 2011, the defendants engaged in a scheme to manipulate the stock of Gerova Financial Group, unloading it as it rose, according to the New York U.S. Attorney's office. The defendants "fraudulently generated demand for Gerova stock by bribing investment advisers to purchase" the stocks that the defendants were dumping, according to the U.S. Attorney's office. Jason Galanis gained control of Gerova and caused it to engage in transactions he favored, say the criminal investigators.
The securities commission notes that John Galanis "has been a defendant in numerous [Securities and Exchange Commission] enforcement actions dating back to the 1970s," while Jason Galanis is "a securities fraud recidivist."