Axius Fraud Conspirator Pleads Guilty in Stock-Price Case

A financial professional accused of helping Axius Inc. (AXIU)’s chief executive officer try to manipulate the company’s stock price pleaded guilty to conspiracy in federal court in Brooklyn, New York.

Jean-Pierre Neuhaus and Axius CEO Roland Kaufman, both Swiss citizens, are alleged to have tried to artificially inflate the value of the Dubai-based company’s stock with help from someone they believed was in contact with corrupt stock brokers. Neuhaus pleaded guilty to a single count of conspiracy before U.S. District Judge John Gleeson today.

The defendants thought the person, who was actually an undercover U.S. agent, would direct the brokers to buy Axius shares in exchange for kickbacks of as much as 28 percent, according to court filings submitted by the Justice Department.

“I made false representations to people in order to buy and sell Axius stock so I would get a commission,” Neuhaus said while standing before Gleeson in khaki jailhouse garb and speaking in heavily accented English.

His lawyer, Johanna Zapp, declined to comment after the hearing. His sentencing date is scheduled for Nov. 30.

Axius described itself as a “business incubator” and holding company in a report filed with the U.S. Securities and Exchange Commission in February. At the time auditors told the company it may not be able to continue as a going concern because of recurring losses and cash shortages, according to the report.

‘Personal Reasons’

Company representatives didn’t immediately respond to a message left at a Dubai phone number listed in Axius SEC filings. The company’s chief financial officer John Figliolini resigned for “personal reasons” according to an Oct. 1 report submitted with the agency. Operations of a subsidiary of Axius, Dr. Jules Nabet Cosmetics Inc., were discontinued in September “because of lack of financial resources,” according to the report.

Neuhaus is being held in federal custody. Kaufman is free on a $2.5 million bond, according to court records. A lawyer for Kaufman, Eric Snyder, didn’t immediately respond to a call seeking comment.

The case is U.S. v. Neuhaus, 12-cr-00439, U.S. District Court, Eastern District of New York (Brooklyn).

To contact the reporter on this story: Christie Smythe in New York at csmythe1@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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