SEC defendants Cervino, Khan sentenced in New York

by Mike Caswell

A New York judge has a imposed a jail term of one year and a term of four years on two individuals accused of helping Vancouver-linked fraudster Ed Durante as he defrauded investors in a pink sheets company of $11-million or more. (All figures are in U.S. dollars.) The one-year term went to Christopher Cervino, a former New Jersey broker who carried out matched trades in support of the scheme. The four-year term went to Sheik Khan, a former financial adviser who accepted undisclosed payments from Mr. Durante.

The sentences come as part of a case in which prosecutors claimed that Mr. Cervino and Ms. Khan helped Mr. Durante defraud investors in an ultimately worthless listing called VGTel Inc. According to the government, Mr. Durante told investors that the stock could go to $50 while he touted unrealistic deals. Many of the scheme's victims were retirees and widows, with some selling conservative investments to buy VGTel.

Mr. Cervino and Ms. Khan received their sentences in a court appearance on Thursday, Jan. 18, before New York Judge Andrew Carter. In addition to the jail term, the judge ordered Mr. Cervino, 45, to serve three years of supervised release and to forfeit $35,000. Ms. Khan, 54, must also serve three years of supervised release and forfeit $290,787. The pair could also have to pay restitution, with the government to determine an amount at a later date.

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