DOJ charge Simi Valley executives in alleged multi-million ‘pump-and-dump’ scheme

SIMI VALLEY, Calif. — Prosecutors in Los Angeles charged two Simi Valley executives for allegedly conspiring to defraud investors in a multi-million securities fraud scheme, dating back in or around May of 2014.

According to the Central District of California U.S. Attorney's Office, Kalistratos “Kelly” Kabilafkas, 48, of Moorpark, and Jack Edward Daniels, 74, of Agoura Hills, are being charged with one count of conspiracy and one count of securities fraud.

The alleged scheme centered around the acquisition and sale of Airborne Wireless Network securities.

From in or around May 2014 to in or around November 2018, Kabilafkas and Daniels conspired to secretly acquire the freely tradable shares of a publicly traded shell company and later rebranded it as Airborne, according to the indictment.

Prosecutors said, Kabilafkas allegedly misappropriated a fake $474,500 charitable donation and then used funds to secretly buy the shell company’s stock to acquire the company, carrying out a “pump-and-dump” scheme.

Once AWN securities were acquired, Kabilafkas and Daniels — Airborne’s president and sole director – allegedly filed false reports with the Securities and Exchange Commission to conceal from investors that Kabilafkas secretly held all of Airborne’s stock.

According to the DOJ, Kabilafkas was arraigned Tuesday afternoon in U.S. District Court in downtown Los Angeles.

Daniels’ arraignment is scheduled for May 3.

If convicted, Kabilafkas and Daniels each face a maximum penalty of five years in prison for conspiracy and 20 years in prison for securities fraud.