U.S. Attorney Announces Recovery Of $19.5 Million For Victims Of China-Based Pump-And-Dump Schemes

United States Attorney for the Southern District of New York, Jay Clayton, and Special Agent in Charge of the Nashville Field Office of the Federal Bureau of Investigation ("FBI"), Terence G. Reilly, announced today the filing of two civil forfeiture Complaints for more than $19.5 million in cash and stock obtained through pump-and-dump market manipulation schemes involving CTRL Group Limited ("CTRL Group") and Dreamland Limited ("Dreamland"), Hong Kong-based companies listed on the Nasdaq stock exchange. The proceeds were previously seized pursuant to judicially-authorized seizure warrants.

"Today's action demonstrates our unwavering commitment to protecting U.S. investors and safeguarding the integrity of our markets," said U.S. Attorney Jay Clayton. "These schemes, driven by Asia-based small-cap foreign issuers seeking to manipulate share prices and exploit American investors, pose serious risks to those who place their trust in our financial system. Investors should exercise caution when dealing with thinly traded foreign issuers, as these companies can be especially vulnerable to manipulation and can expose investors to significant, often hidden, risks. I want to thank the FBI and our law enforcement partners for their exceptional work and their continued dedication to rooting out this conduct and prioritizing the recovery of funds stolen from victims."

"Pump-and-dump schemes erode the integrity of our capital markets and cause financial hardship for countless investors," said FBI Special Agent in Charge Terence G. Reilly. "The recovery of $19.5 million is an important first step toward providing relief for victims and should serve as a reminder that the FBI will vigorously investigate and pursue those who seek to manipulate financial systems for personal gain."

According to the allegations contained in the Complaints filed in Manhattan federal court today:(1)

CTRL Group

CTRL Group is a British Virgin Islands-registered company that purports to offer marketing and advertising services in Hong Kong, including mobile game promotions. CTRL Group began trading on the Nasdaq stock exchange under the symbol MCTR on January 22, 2025.

In late May and early June 2025, various social media accounts on multiple platforms began to post hundreds of identical comments touting MCTR as a stock that was going to increase in value. For instance, these users would make a post saying "$MCTR Here We Go" or "$MCTR New alerts have been posted in the last hours," followed by a link to a Discord group chat that purported to offer investment advice.

On June 3, 2025, MCTR stock price and trading volume spiked sharply. MCTR opened at $7.12 per share-up more than 50% from the prior day-hit an intra-day high of $33.69 per share, and closed at $32.90 per share, with approximately 44,200,000 shares trading that day, a jump of more than 70,000% compared to the previous day. Similar price surges occurred on June 4 and June 5. The surge in MCTR's price and volume was accompanied by a surge in social media activity promoting MCTR. After the social media activity stopped, MCTR's stock price dropped. By the end of June 2025, MCTR's stock price had declined to $2.82 per share.

Between MCTR's initial public offering and June 5, 2025, and primarily during the period of social media promotion discussed above, 10 U.S. brokerage accounts engaged in massive, profitable, and anomalous trading in MCTR, selling a combined total of approximately 1,065,313 shares for total proceeds of approximately $11,966,324.44. These 10 accounts were opened by individuals located in China or Hong Kong. Although the accounts were ostensibly owned and controlled by different people, eight of these accounts logged into their brokerage accounts with the same IP address and/or MAC address as at least one of the other accounts, indicating collusion.

On or about June 1, 2026 and June 23, 2026, the Government seized approximately $10.3 million in cash from the 10 brokerage accounts pursuant to seizure warrants issued by the U.S. District Court for the Southern District of New York.

Dreamland

Dreamland is a Cayman Islands-incorporated company that purports to operate an event management business in Hong Kong. Dreamland began trading on the Nasdaq stock exchange under the symbol TDIC on July 23, 2025.

Between May 13-14, 2026, the share price of TDIC surged more than ten-fold, apparently driven at least in part by social media campaigns promoting TDIC as a "short squeeze" play. Between January 2, 2026, and May 12, 2026, TDIC's closing price ranged between $0.57 and $2.36 per share, with an average daily trading volume of approximately 2,600,000 shares. On May 13, 2026, TDIC's stock price suddenly soared to an intra-day high of $30.00 per share, before closing at $23.05 per share, with approximately 109,000,000 shares trading. The following day, May 14, 2026, TDIC's share price opened at $21.49 and declined to a closing share price of $0.80. By June 12, 2026, TDIC's price closed at $0.23 per share.

On or about May 14, 2026, during the sudden surge in TDIC's share price, a U.S. brokerage firm notified the Financial Industry Regulatory Authority ("FINRA") of unauthorized trades as a result of compromised login credentials, resulting in potential stock manipulation of TDIC. The credentials, which belonged to a third-party financial advisor that used the brokerage's trading platform, were used to attempt to access eight client accounts and successfully accessed three client accounts, which attempted to purchase a combined total of approximately 1,361,488 shares of TDIC for a total of approximately $22,882,550.70 (an average share price of $16.81). All of the purchases appear to have been cancelled by the brokerage.

Around the same time as the social media promotion of TDIC and the compromised account activity, a brokerage account held in the name of Imperial Vision Fund SPC - Series 1 SP ("Imperial Vision") sold approximately 1,486,841 shares of TDIC for total proceeds of approximately $17,692,745.89. Imperial Vision purports to be a Hong Kong-based investment fund incorporated in the Cayman Islands, and it previously purchased TDIC shares directly from Dreamland.

On June 15, 2026, the Government seized approximately $8.4 million in cash and approximately $850,000 worth of securities from the Imperial Vision brokerage account pursuant to a seizure warrant issued by the U.S. District Court for the Southern District of New York.

* * *

Mr. Clayton praised the outstanding work of the FBI. Mr. Clayton also expressed appreciation for the assistance of FINRA and the Securities and Exchange Commission's Cross-Border Task Force.

The two cases are being handled by the Office's Securities and Commodities Fraud Task Force. Special Assistant U.S. Attorney Michael S. DiBattista is in charge of the CTRL Group action. Assistant U.S. Attorney Alexander Li is in charge of the Dreamland action.

A civil forfeiture complaint is merely an allegation that money or property was involved in or represents the proceeds of a crime. These allegations are not proven until a court awards a judgment in favor of the United States.

1. ^

   As the introductory phrase signifies, the Complaints, and the descriptions of the Complaints set forth herein, constitute only allegations, and every fact described should be treated as an allegation.