GILLETTE — A federal jury in Cheyenne returned guilty verdicts against three men related to a stock fraud involving NuTech Energy Resources Inc., a company that claimed to operate coalbed-methane wells in Wyoming.

Justin Herman, 50, of Canonsburg, Pennsylvania, and Charles “Chuck” Winters Jr., 61, of Bradenton, Florida, were convicted of fraud and identity theft crimes, said Acting United States Attorney Bob Murray.

Attorney Ian Horn, 67, of Brandon, Florida, was acquitted of the charged fraud crimes but convicted of making a false statement to the grand jury.

According to court documents and evidence presented at trial, Herman and Winters conspired with Robert “Bob” Mitchell, who pleaded guilty earlier this year, to pump and dump NuTech stock. A “pump and dump” is a form of securities fraud where the conspirators manipulate demand for a stock and the stock’s price, and then sell their worthless shares of the stock to the public at the artificially high price.

In this case, the conspirators bought control of a publicly traded shell company called EcoEmissions Solutions Inc. and changed the company’s name to NuTech Energy Resources, whose stock was sold under the ticker symbol NERG, according to Murray.

The conspirators released information online to create a false image for NuTech as a company located in Gillette that was operating gas wells in Wyoming using a patented technology. In reality, NuTech had no business, no revenue, and no paid employees in Wyoming or elsewhere.

As part of the conspiracy, Herman and Winters used altered, backdated and forged documents to acquire 13 billion free-trading shares of NuTech common stock. The conspirators then artificially inflated the market price of NuTech common stock by manipulative trading and by releasing to the public false and misleading information about NuTech’s business prospect, Murray said.

When the market price increased based on that false information, the conspirators turned around and sold their worthless NuTech shares to unwitting investors in the public market, including investors in Wyoming and around the world.

Ian Horn is a Florida-licensed attorney. As part of the investigation, Horn was subpoenaed to testify before the grand jury in January 2019 because his name appeared on documents related to NuTech and because the money used by Mitchell and Herman to buy control of EcoEmissions was transferred through Horn’s bank accounts, Murray said.

The jury found that Horn lied during his grand jury testimony about NuTech-related email communications that he falsely claimed he had lost and could not access even though he still had access to his email and was forwarding relevant email messages to Herman in December 2018.

Herman and Winters were each found guilty of conspiracy to commit securities fraud, securities fraud, conspiracy to commit wire fraud, and multiple counts of aggravated identity theft.

Herman faces a mandatory two-year prison sentence and could be sentenced to a maximum of 53 years in prison.

Winters also faces a mandatory two-year prison sentence and could be sentenced to a maximum of 49 years in prison.

Horn was found guilty of making a false statement to the grand jury and could be sentenced to a maximum of five years in prison.

The defendants are scheduled to be sentenced by U.S. District Court Judge Alan B. Johnson in Cheyenne on Jan. 5.

Bob Mitchell is scheduled to be sentenced by Johnson on Oct. 15. Mitchell could be sentenced to a maximum of 25 years in prison.

“These convictions are the direct result of a diligent investigation by a hardworking postal inspector and our partners at the Department of Interior Office of Inspector General and the U.S. Attorney’s Office for the District of Wyoming,” said Ruth Mendonça, inspector in charge of the Denver Division, which includes Wyoming.

“Working together, their perseverance unraveled the defendants’ complex scheme to defraud over 2,300 victims and delivered the justice that each victim deserved," Mendoca said.

This case was investigated by the U.S. Postal Inspection Service and the U.S. Department of Interior’s Office of Inspector General. Assistant United States Attorneys Eric Heimann and Thomas Szott prosecuted the defendants. The Criminal Prosecution Assistance Group of the Financial Industry Regulatory Authority assisted in the investigation and prosecution.