Jennifer R. Ransom, 41, of Meridian, Idaho, was sentenced Jan. 7 in the U.S. District Court for the District of Idaho to 30 months in prison followed by three years of supervised release – the first six months of which is home confinement – for the crime of securities fraud, said the U.S. Attorney for Idaho, Wendy J. Olson.
Senior United States District Judge Edward J. Lodge also ordered Ransom to forfeit $580,780 and pay $116,138 in restitution to victim-investors. Ransom pleaded guilty to one count of securities fraud on April 21, 2015.
According to the plea agreement, Ransom was the Senior Vice President of Administration of Alternate Energy Holdings Inc. (AEHI). AEHI was a development stage company headquartered in Eagle, Idaho, that planned to construct and operate a nuclear power plant in Payette County, Idaho.
According to the plea agreement, Ransom joined AEHI in late 2007. Prior to joining AEHI, Ransom took and passed the Series 63 examination, one of the tests required to become a licensed Securities Agent, and knew it was wrongful and unlawful to engage in conduct that was designed to defraud or deceive investors by artificially controlling or fraudulently affecting the price of securities. Notwithstanding, she agreed with her co-defendant, Donald L. Gillispie, the former President and CEO of AEHI, and other “nominees” to a scheme to defraud or deceive AEHI investors, the U.S. Attorney said.
According to the plea agreement, the scheme involved Gillispie and Ransom recruiting nominees to make purchases of AEHI stock on the market for the express purpose of artificially inflating the market price of AEHI stock. Ransom personally helped recruit one of the nominees. Without investors’ knowledge, Gillispie and Ransom provided AEHI funds, obtained almost exclusively from investors, to two of the nominees to fund their market purchases of AEHI stock.
“This sentence sends the clear message that those who take actions to intentionally mislead stock purchasers for their own personal gain will be held accountable,” said Olson. “Our securities markets require, and investor decisions rely on, fair dealing, not deception. Ms. Ransom’s intentional decision to disregard her obligations as a corporate vice president warrants her prosecution and punishment in this case.”
In May 2015, Donald Gillispie failed to appear for two scheduled arraignment hearings. He remains a fugitive and is being pursued by the U.S. Marshals Service.
The case was investigated by the Internal Revenue Service, Criminal Investigation Division, and the Federal Bureau of Investigation.
This case is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF), which was created in November 2009 to investigate and prosecute financial crimes. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants.
The SEC in August 2015 terminated its registration for AEHI. Said a November 2012 Form 10-Q filing by the company with the SEC about it and its subsidiaries: “Idaho Energy, an Idaho limited liability company and 100% wholly-owned subsidiary of the Company that was formed in March 2007, is the operating entity for our proposed $10 billion nuclear complex near Payette, Idaho. Idaho Energy is the manager of Reactor Land Development LLC, a Delaware limited liability company that is attempting to obtain funding for the nuclear facility land, water rights and the NRC operating license. Five thousand acres have been dedicated to the Project, which will provide enough electricity to power Idaho’s growth, as well as generate income through the sale of power to out-of-state markets. The Payette facility will feature a new advanced nuclear reactor design that does not require large amounts of water for cooling. The Company plans to build up to six advanced reactors at Idaho Energy and operate as an Independent Power Product (‘IPP’).”