New York Southern District prosecutors and the Federal Bureau of Investigation (FBI) announced on the 30th that they have brought two civil forfeiture lawsuits against “pump-and-dump” market manipulation scams involving two Chinese companies listed on the Nasdaq, CTRL Group Limited and Dreamland Limited, successfully recovering over $19.5 million in cash and stock assets.
Authorities stated that the funds in question have been frozen in accordance with court seizure orders and will potentially be used as a source of compensation for defrauded investors.
According to court documents, CTRL Group is a British Virgin Islands registered company that claims to provide marketing and advertising services in Hong Kong, including mobile game promotion, and traded on Nasdaq under the symbol MCTR in January 2025. Prosecutors alleged that from May to June 2025, multiple social media accounts posted identical content hyping the stock’s imminent rise and directing investors to join related chat groups.
Under the inflated speculation, MCTR’s stock price surged to $33.69 on June 3, 2025, before quickly plummeting to around $2.82 by the end of the month. Prosecutors pointed out that during this period, 10 trading accounts related to China or Hong Kong conducted unusually concentrated trades, making profits of approximately $11.96 million, with some of the funds already seized (around $10.3 million).
Dreamland, another company registered in the Cayman Islands, claimed to operate activity management business in Hong Kong and went public on Nasdaq under the symbol TDIC in July 2025. Prosecutors highlighted that the stock experienced a drastic surge driven by social media promotion in May 2026, skyrocketing more than tenfold before quickly falling back to below $1.
Documents revealed that during the period of abnormal price fluctuations, a U.S. securities brokerage firm reported to the Financial Industry Regulatory Authority (FINRA) unauthorized trades due to stolen login credentials, potentially indicating manipulation of the TDIC stock price. Additionally, a large investment account under the name of Imperial Vision concentrated on selling shares for a profit at high levels, with total cashing out amounting to nearly $17.7 million. Imperial Vision claimed to be an investment fund headquartered in Hong Kong, registered in the Cayman Islands, and had previously directly purchased TDIC shares from Dreamland.
In June 2026, law enforcement agencies, following court seizure orders, froze about $8.4 million in cash and $850,000 in securities from the Imperial Vision account.
U.S. prosecutor Jay Clayton stated that manipulation schemes led by small Asian issuers, disseminating false investment signals through social media to intentionally inflate stock prices and unload at the peak, pose a serious risk to American investors. He emphasized that law enforcement will continue to investigate and recover embezzled funds.