A Michigan man has been indicted by a federal grand jury in the District of Columbia for allegedly defrauding investors in Minerco Inc., resulting in millions of dollars in losses. The indictment charges Bobby Shumake Japhia, also known as Robert Samuel Shumake Jr., Robert Japhia, and Shaman Bobby Shu, with securities fraud and obstruction.
According to the indictment, Shumake ran Minerco's operations and orchestrated a scheme to deceive investors by making false statements to inflate the company's stock price. Beginning around January 2020, Minerco claimed to be involved in developing psilocybin mushrooms.
Shumake allegedly concealed his involvement with Minerco by appointing Julius Jenge as the nominal CEO due to his own criminal history. He is accused of misleading investigators from the Financial Industry Regulatory Authority during their investigation into Minerco.
Using an alias, Shumake promoted Minerco on investor message boards while pretending to be an independent investor. He also recruited others to promote the company online. It is alleged that he sold nearly one billion shares of Minerco, earning at least $2.5 million from these sales.
Upon learning of an SEC investigation, Shumake reportedly obstructed proceedings by deleting emails related to Minerco business.
If convicted, Shumake faces up to 20 years in prison for each count of securities fraud and obstruction. Julius Jenge was arrested earlier this year on similar charges related to defrauding investors.
The announcement was made by Principal Deputy Assistant Attorney General Nicole M. Argentieri; SEC Inspector General Deborah Jeffrey; and Eric Shen of the U.S. Postal Inspection Service Criminal Investigations Group.
The case is being investigated by the SEC Office of Inspector General and USPIS, with Trial Attorney Kyle Crawford prosecuting.
Victims are encouraged to contact the Fraud Section’s Victim Witness Unit or visit the case webpage for more information.
An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in court.
