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SEC Charges Major PledgeMusic Shareholder With $25M In Penny Stock Fraud

Joshua Sason, whose Magna Group is one of PdgeMusic's largest investors, has been sued by the U.S. Securities and Exchange Commission for fraud. A Friday SEC filing accuses Sason of. Continue reading [https://www.hypebot.com/hypebot/2019/02/sec-charges-major-pledgemusic-shareholder-with-25m-in-stock

,   and  Bruce Houghton
PledgeMusicJoshua Sason, whose Magna Group is one of PdgeMusic's largest investors, has been sued by the U.S. Securities and Exchange Commission for fraud. A Friday SEC filing accuses Sason of an elaborate scheme to illegally obtain $25 million in shares of penny stock to unload on investors."Magna Group and its co-defendants used fake debt instruments to unlawfully obtain shares in microcap companies, which they then dumped on unsuspecting retail investors,” said Sanjay Wadhwa, of the SEC’s New York office. “This action demonstrates the resolve of the SEC in pursuing fraudsters who use elaborate financing schemes to engage in securities fraud.”Sason, now 31, made millions in his 20's by making high interest loans to desperate penny stock companies. He invested $3 million in PledgeMusic in 2014, and two years later took take a 'major position' in the crowdfunder to finance acquisitions of Noisetrade and Set.fm (later sold). Magna also invested in Loud & Proud Records.PledgeMusic has been crippled by an inability to pay artists when their crowdfunding campaigns were completed. Hundreds of artists have been effected and are owed sums ranging from a few thousand dollars to more than $100,000 each. After more than six months of problems the company completely suspended all crowdfunding campaigns almost two weeks ago.New Filing with Sword & RoweOn Friday, there was a redacted UK Company House filing between PledgeMusic and UK merchant bankers Sword Rowe. While the amount and details of the transaction are unclear, the filing refers to a debenture or loan secured against PledgeMusic's assets.The filing was purely "procedural," a source familiar with the company told Hypebot, and related to an existing secured loan facility. It was not an indication of new investment activity, according to the source.Sword Rowe has previously made investments in Atlas Music Publishing, Dubset, Songspace and other entertainment and media companies.

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