December 27, 2018 / 10:56 PM / 22 days ago

Florida biotech billionaire settles SEC stock manipulation case

NEW YORK (Reuters) - Florida biotechnology billionaire Phillip Frost has agreed to pay $5.52 million to settle U.S. Securities and Exchange Commission civil charges over his alleged role in “pump-and-dump” schemes that left investors with virtually worthless stock.

The settlement requires Frost, the chairman and chief executive of Miami-based Opko Health Inc (OPK.O), to pay a $5 million fine and about $523,000 representing alleged ill-gotten gains and interest, according to a Thursday filing in Manhattan federal court.

Frost also accepted restrictions on trading penny stocks. Opko agreed to pay a $100,000 fine in a related settlement.

Neither defendant admitted or denied wrongdoing in agreeing to the settlements, which will end “potentially expensive, contentious and time-consuming litigation,” Frost said in a statement provided by Opko. Court approval is required.

A lawyer for Frost had no immediate additional comment.

Frost was among 10 people and 10 associated entities charged by the SEC on Sept. 7 with involvement from 2013 to 2018 in the manipulation of three companies’ share prices.

The SEC accused various defendants of buying large blocks of penny stocks at steep discounts, promoting the shares, and then quietly selling their stock at inflated prices, generating more than $27 million of improper gains.

Frost was allegedly involved in two of the schemes, the SEC said.

Now 82, Frost is worth $1.9 billion, Forbes magazine said on Thursday.

He had been chairman and chief executive of Ivax Corp before selling that drugmaker for $7.4 billion in 2006 to Israel-based Teva Pharmaceutical Industries Ltd (TEVA.TA), where he later served as chairman.

Reporting by Jonathan Stempel in New York; Editing by Tom Brown

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