The Securities and Exchange Commission (SEC) has charged Jeremy Koski, a resident of Hawaii, with securities fraud in connection with his manipulation of the trading market for structured equity securities backed by certain J.C. Penney Company, Inc. debentures, which trade over the counter under the symbol COTRP.

The Commission alleges that Koski fabricated and anonymously posted fake documents on Internet message boards under different usernames in order to boost the trading price of COTRP and increase the value of his large position in the stock.

As alleged in the SEC’s complaint, in May 2021, Koski posted fake notices on U.S. Bank letterhead falsely stating that the JCP Debentures would be redeemed early at their full value, causing a 75% spike in the price of COTRP.

In September and November 2021, Koski also allegedly fabricated and disseminated phony COTRP press releases purporting to announce that “COTRP will be the first publicly traded security fund to convert to a cryptocurrency,” and that this “cryptocurrency conversion” would “allow the fund to recover the face value of $25 as it opens up to a new world of digitized currency.” As alleged, Koski knew that these statements were false.

The SEC’s complaint, filed in the U.S. District Court for the Southern District of New York, charges Koski with violating Section 17(a) of the Securities Act of 1933, Section 10(b) the Securities Exchange Act of 1934 and Rule 10b-5. The complaint seeks a permanent injunction against future violations of these antifraud provisions, a conduct-based injunction, civil monetary penalties, and a penny stock bar.