Andrew Murstein, president of the Medallion Financial Corporation and former co-owner of the Richard Petty Motorsports NASCAR team, has been charged with alleged federal securities law violations, according to a n press release.

Murstein and his company have been charged with “illegally engaging in two schemes in an effort to reduce the company’s plummeting stock price” from 2014 through 2017. Basically, Murstein’s family has been entrenched in the New York City taxicab business since 1937, eventually coming to own over , which are basically the permits that enable cab drivers to legally operate in the city. Unable to sell those medallions, the family founded the Medallion Funding Corp. which later became owned by Andrew Murstein’s Medallion Financial Corp.

That company owns and leases medallions in New York City; Newark, NJ; Cambridge, MA; Philadelphia, PA; Boston, MA; and Chicago IL.

Taxi medallions used to be worth millions, but the value of the medallions has plummeted with the rise of rideshare companies like Uber and Lyft. Rideshare drivers don’t need a medallion to operate, and it has left cab drivers in NYC unable to claw their way out of the debts they amassed to acquire medallions — which led to a earlier this year.

Murstein and his company, which trades under MFIN in NASDAQ, also felt the blow. Medallion’s stock price dropped, but Murstein allegedly undertook two different schemes to artificially inflate prices with the help of a California media strategy company known as Ichabod’s Cranium.

From the SEC press release:

The complaint, filed in federal district court in Manhattan, alleges that Murstein and Medallion engaged in illegal touting by paying Ichabod’s Cranium and others to place positive stories about the company on various websites, including Huffington Post, Seeking Alpha, and TheStreet.com. With Murstein’s knowledge, Meyers and others created fake identities so their opinion pieces would appear credible to potential investors. The complaint further alleges that Medallion and Murstein fraudulently increased the carrying value of Medallion Bank (the Bank), a wholly owned subsidiary of Medallion, to offset losses relating to the taxicab medallion loans. The complaint alleges that when the existing valuation firm refused to cave to Murstein’s pressure to increase the Bank’s valuation, Murstein fired the firm and hired a new firm to provide an inflated valuation of the Bank.

Paying for fake puff pieces to keep your stock prices inflated? That’s a big no-no.

The SEC’s complaint charges Murstein and Medallion with violating antifraud, books and records, internal controls, and anti-touting provisions of federal securities laws, along with making false statements to Medallion’s auditor. Further, SEC is charging Ichabod’s Cranium and its owner, Lawrence Meyers, with touting and fraud.

Murstein and his company acquired the racing assets of Richard Petty Motorsport as part of a large investment group back in November 2010. He earlier this month, after the conclusion of the 2021 NASCAR Cup Series season.