Scot accused of share fraud: ‘I don’t use stock markets’

James Craig, who denies manipulating the stock market from his house at Dunragit, near Stranraer
James Craig, who denies manipulating the stock market from his house at Dunragit, near Stranraer
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A SCOT facing fraud charges in the US has denied any knowledge of tweets that authorities claim were intended to manipulate stock prices.

James Craig, 62, of Dunragit, near Stranraer, said he was only made aware of the allegations through media reports and claimed he had no interest in the stock market.

The US Securities and Exchange Commission (SEC) announced it had filed securities fraud charges against him in a federal court in California.

Speaking from his home, Craig said: “I have never been approached by any law enforcement agency telling me I am subject of any investigation. Of course I deny it.

“The first I knew of it, in all honesty, was when the TV camera turned up this morning and I thought ‘What’s happened here?’ Somebody texted me about two minutes later.

“No law enforcement agency has ever come to me. Nobody has interviewed me. Not even the local law enforcement have come to tell me about this.”

He challenged US authorities to contact him directly, “instead of making allegations over the airwaves”.

The complaint alleges that Craig tweeted false statements in 2013 about two companies, Audience and Sarepta Therapeutics, on accounts he created to look like those of securities research firms.

Several tweets suggesting that Audience was under federal investigation were said to have made the share price of the mobile audio company to fall by 28 per cent before the Nasdaq stock exchange temporarily halted trading.

Further alleged tweets that claimed Sarepta Therapeutics was also subject to an investigation sent shares in the drugs firm tumbling by 16 per cent.

Craig is accused of buying and selling shares in both companies in an attempt to profit when the stock rebounded, the SEC said.

He has been indicted by a grand jury in San Francisco, where prosecutors claimed shareholders had lost more than £1 million as a result.

Standing on the doorstep of his home, which has a US flag flying in the garden, Craig denied even playing the stock market.

He added: “Never had an interest in it. I wish instead of making allegations over the airwaves they had the decency to make them to me.

“I’ve been very ill since picking up a virus while sailing in 2009 and it has just got worse.”

Craig is twice divorced but is believed to be currently in a relationship with a Californian woman.

Financial writer Tom Petrino, a former business correspondent for the LA Times, said Craig was a “lousy trader” who made less than $100 (£66) from the alleged fraud.

Police and regulators have confirmed their investigations. FBI special agent in charge David Johnson said: “This investigation dismantled a stock market manipulation scheme that operated with one goal in mind: to falsely defame a company in order to destroy its stock value for financial gain.”

The SEC complaint seeks a permanent injunction against future violations, the return of any illegally made profits and a financial penalty from Craig.

Jina Choi, director of the SEC’s San Francisco regional office, said: “Craig’s fraudulent tweets disrupted the markets for two public companies and caused significant financial losses for their investors.

“Craig also said in later tweets that the SEC would have a hard time catching the perpetrator. As yesterday’s enforcement action demonstrates, those tweets turned out to be false as well.”

Police Scotland said it had been asked by the FBI last year to help with the case.

A spokesman said that Police Scotland had been asked by the FBI to assist with their investigations and had executed a search warrant.