Phillip Frost settles civil stock-fraud charges with SEC

Phillip Frost, the billionaire Miami philanthropist and chair and CEO of pharma group OPKO Health, Inc., said Thursday he had reached an agreement with the Securities and Exchange Commission to settle a civil complaint of stock fraud.

“We have reached agreement with the SEC that will end a potentially expensive, contentious and time-consuming litigation and I am happy that we can focus on an exciting and productive 2019 for OPKO Health,” Frost said in a statement.

Frost, the namesake of Miami’s new science museum, and OPKO were charged in September with participating in a scheme that involved artificially inflating the price of penny stocks. This was allegedly done through maneuvers including paying bloggers to tout the companies without disclosing those payments.

Without admitting or denying the SEC’s allegations, Frost, 82, agreed to pay a $5.5 million penalty and a ban, with certain exceptions, on trading in penny stocks. OPKO agreed to pay a $100,000 penalty. The settlement must still be approved by a court.

Frost will continue to serve as OPKO’s CEO and Chairman. In September, Frost stepped down as chairman of financial group Ladenburg Thalmann, a position he had held for more than a decade. This week, Ladenburg purchased Frost’s stock and options in the company for a total of $130.25 million.