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Jonathan Moynahan Larmore is Alleged to Have Announced a Fake Tender Offer for WeWork Stock to Fraudulently Inflate the Value of His Own WeWork Securities
Damian Williams, the United States Attorney for the Southern District of New York, and James Smith, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today the unsealing of an Indictment charging JONATHAN MOYNAHAN LARMORE with tender offer fraud and securities fraud in connection with LARMORE’s announcement of a fake tender offer to manipulate the stock price of WeWork, Inc. (“WeWork”). LARMORE is alleged to have announced a false $77 million tender offer for WeWork stock, news of which immediately led investors to buy WeWork stock at fraudulently inflated prices during after-hours trading, in an effort to drive up the value of his WeWork call options and shares. LARMORE was arrested this morning and will be presented in federal court later today in the Middle District of Florida. The case is assigned to U.S. District Judge Paul A. Engelmayer.
U.S. Attorney Damian Williams said: “Jonathan Moynahan Larmore's alleged actions strike at the heart of market integrity and investor confidence. By allegedly orchestrating a deceptive scheme involving a counterfeit tender offer, he purportedly preyed upon investors, artificially inflating the value of WeWork stock for personal enrichment. The charges leveled against Larmore highlight the profound implications of his alleged fraudulent conduct, emphasizing the imperative of accountability and transparency in our financial systems.”
FBI Assistant Director in Charge James Smith said: “Jonathan Larmore allegedly drafted a fraudulent press release announcing a fictitious tender offer to inflate WeWork stock prices, after personally investing in the company through call options. Thankfully, Larmore was unable to widely distribute the press release before the end of the trading day, which failed to increase the share price in time and caused Larmore’s options to expire rather than making him millions. As alleged, even though his scheme did not net him his desired profits, Larmore’s conduct artificially impacted the market and caused harm to other shareholders. This indictment reaffirms the FBI’s commitment to protecting our nation’s economic integrity by holding responsible those who manipulate the system for financial gain.”
As alleged in the Indictment:[1]
In or about the fall of 2023, LARMORE perpetrated a scheme to use a false and fraudulent tender offer to manipulate the stock price of WeWork, a co-working space company that was, at all relevant times, headquartered in New York, New York, and publicly traded on the New York Stock Exchange.
LARMORE executed his scheme in three steps. First, on or about October 6, 2023, LARMORE created Cole Capital Funds LLC (“Cole Capital”), a purported a real estate investment firm that was, in fact, merely a sham company. Second, on or about November 1, 2023, and November 2, 2023, LARMORE spent more than $775,000 buying tens of thousands of cheap, short-dated, out-of-the-money WeWork call options (the vast majority of which were set to expire on November 3, 2023 at 4:00 p.m. EDT) and hundreds of thousands of shares of WeWork common stock — the latter primarily because two of LARMORE’s brokerage firms did not authorize him to trade options, but did authorize him to buy equities. Third, on or about November 3, 2023, LARMORE caused a press release to be published announcing that Cole Capital proposed to acquire 51% of all outstanding shares owned by minority shareholders of WeWork at a more-than-700% premium in an all-cash offer worth more than $77 million. At the time, WeWork was on the verge of bankruptcy.
In fact, neither LARMORE nor Cole Capital had the intent or ability to execute the announced tender offer. Instead, LARMORE intended for news of the tender offer to fraudulently inflate WeWork’s share price and, thereby, to increase the value of LARMORE’s newly acquired WeWork call options and shares.
On or about November 3, 2023, at approximately 5:12 p.m. EDT, the press release about Cole Capital’s purported tender offer was published. Within approximately one minute of publication, in after-hours trading, WeWork’s share price quickly increased more than 70% from $.85 to $1.45, and continued to rise until 5:31 p.m. EDT, when the stock reached its high of $2.14, which was a more-than-150% increase over the stock price prior to the publication of the press release.
The WeWork call options LARMORE purchased could have made LARMORE millions of dollars if the news of LARMORE’s fraudulent tender offer had caused WeWork’s share price to increase significantly prior to the expiration of LARMORE’s options. Unfortunately for LARMORE, he mistimed how long it would take to properly format his press release and have it published. As a result of these delays, LARMORE’s fraudulent press release was not published—and WeWork’s share price did not accordingly rise—until approximately 5:12 p.m. EDT on or about November 3, 2023, which was about an hour after the vast majority of LARMORE’s WeWork call options had expired worthless at 4:00 p.m. EDT that day.
On the following Monday, November 6, 2023, WeWork filed for Chapter 11 bankruptcy protection. On or about November 10, 2023, the small number of remaining WeWork options LARMORE had purchased expired out of the money and worthless.
LARMORE, 51, of Punta Gorda, Florida, is charged with one count of tender offer fraud and one count of securities fraud, each of which carries a maximum sentence of 20 years in prison.
The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge.
Mr. Williams praised the outstanding work of the FBI. Mr. Williams also thanked the U.S. Securities and Exchange Commission, which filed a civil action against LARMORE on November 28, 2023, for its assistance and cooperation in the investigation.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Justin V. Rodriguez and Alex Rossmiller are in charge of the prosecution.
The charges contained in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth herein constitute only allegations, and every fact described should be treated as an allegation.
Third Defendant Still Being Sought
Bronx District Attorney Darcel D. Clark today announced that a Manhattan man has been indicted for the kidnapping and murder of two people who were shot execution style and left in a burning car on the side of a road near Pelham Bay Park.
District Attorney Clark said, “The victims were shot and virtually cremated when they were found. We are holding accountable those who allegedly participated in this brutal crime and will continue to pursue justice for the family of these two young people.”
District Attorney Clark said the defendant, Rahul Cuya, 24, of Baruch Drive, Manhattan, is charged with first-degree Murder, six counts of second-degree Murder, two counts of firstdegree Manslaughter, two counts of first-degree Arson, two counts of second-degree Arson, two counts of third-degree Arson, two counts of first-degree Kidnapping, two counts of second-degree Kidnapping, two counts of first-degree Criminal Use of a Firearm, three counts of second-degree Criminal Possession of a Weapon, two counts of first degree Robbery, third-degree Grand Larceny and fourth-degree Grand Larceny. Cuya was arrested on March 12, 2024, and was arraigned today before Bronx Supreme Court Justice Brenda Rivera. The defendant was remanded and is due back in court on June 21, 2023. Jahmel Sanders was arraigned on the indictment on March 9, 2023, and a third defendant is still being sought.
According to the investigation, on May 16, 2022, the defendant in concert with others allegedly kidnapped Nikki Huang, 22, and Jesse Parrilla, 22, transported them to Shore Road near Pelham Bay Park, where they were shot execution-style. The car was set on fire with the victims inside of it. Huang suffered bullet wounds to her head and neck. Parilla suffered bullet wounds to his head and chest. Their bodies were burned almost to ash.
According to the investigation, on May 15, 2022, at 9:30 p.m., Huang told friends who are alleged gang members that she was robbed of a purse in Manhattan, and two hours later, a man was fatally shot in Manhattan.
At approximately 1:20 a.m. on May 16, 2022, Parrilla drove his mother’s Honda Accord and was dropping off Huang near her home on the Lower East Side when the defendants allegedly grabbed him and put him in another vehicle, and one of the defendant’s took the Accord. Approximately 20 minutes later Huang was lured out of her building and was taken in the same Honda Accord. The victims were driven to Queens and then the Bronx. At approximately 4:16 a.m. Parilla’s mother’s Accord was discovered in flames on Shore Road near a golf course.
District Attorney Clark thanked NYPD Detectives Sheldon Smith of Bronx Homicide, Pedro Gomez of the Violent Felony Squad, and John Soto of the 45th Precinct for their work in the investigation.
An indictment is an accusatory instrument and not proof of a defendant’s guilt.
Governor Kathy Hochul today announced increased patrols by New York State Police and local law enforcement to combat alcohol and drug impaired and reckless driving as celebrations for St. Patrick's Day get underway statewide. This traffic enforcement detail will run Friday, March 15 through Sunday, March 17, 2024. This is one of several funded annually by the Governor's Traffic Safety Committee.
"As an Irish New Yorker, I want to make sure we can all celebrate St. Patrick’s Day safely and responsibly,” Governor Hochul said. “There is absolutely no excuse for driving under the influence of drugs or alcohol, and if you are celebrating, plan ahead to get home safely.”
Along with increased DWI patrols and sobriety check points, drivers can expect to see law enforcement ticketing distracted drivers who are using handheld electronic devices during this enforcement period. New York State Police will also conduct checks at retail establishments targeting underage drinking and unlawful sales to minors during the campaign.
During last year's St. Patrick's Day impaired driving enforcement, law enforcement statewide arrested 959 people for DWI, issued 188 tickets for distracted driving and 21,282 tickets in total.
Violation | Number of Tickets |
Impaired Driving | 959 |
Distracted Driving | 188 |
Move Over Law | 152 |
Other Violations | 14,651 |
Seatbelt | 488 |
Speeding | 4,844 |
Grand Total | 21,282 |
Drunk driving kills more than 11,600 people each year nationwide. One person dies every 45 minutes of an alcohol related crash, an average of 32 people a day, and every one of those deaths is preventable.
Choosing to drive impaired can ruin or end your life or someone else's. This St. Patrick's Day, if you drink and drive, you could face jail time, the loss of your license, a higher insurance rate, and dozens of unanticipated expenses.
The Governor's Traffic Safety Committee and New York State Police ask you to commit to following these easy steps, so you can enjoy a safe holiday without jeopardizing lives on the road:
The Governor's Traffic Safety Committee (GTSC) and the New York State STOP-DWI Foundation's "Have a Plan" mobile app, is available for Apple and Droid smartphones. The app enables New Yorkers to locate and call a taxi service and program a designated driver list. It also provides information on DWI laws and penalties, and a way to report a suspected impaired driver.
New Yorkers struggling with an addiction, or whose loved ones are struggling, can find help and hope by calling the state's toll-free, 24-hour, 7-day-a-week HOPEline at 1-877-8-HOPENY (1-877-846-7369) or by texting HOPENY (Short Code 467369).
Available addiction treatment including crisis/detox, inpatient, community residence, or outpatient care can be found using the NYS OASAS Treatment Availability Dashboard at FindAddictionTreatment.ny.gov or through the NYS OASAS website.
