Man Pleads Guilty in Google IPO Scheme

A Dutch man has pleaded guilty to swindling wealthy New Yorkers by promising an inside track to stock in Google Inc. and blazing through $350,000 of their money in a three-month spree through opulent hotels, expensive restaurants and Atlantic City casinos.

Late last year, as speculation swirled around the possibility that the Mountain View, Calif.-based search-engine company would go public, Shamoon Rafiq began meeting investors in New York and telling them he was a venture capitalist and college friend of the company’s founders, prosecutors said.

Rafiq, who was in New York working as a British Telecom business development manager, dangled the lure of “preferred stock” available to founders’ friends and families at the pre-IPO price of $12 a share.

At least five investors, including a lawyer for a European telecommunications company, a senior brokerage executive and the chairman of a global telecom firm, wired $500,000 into Rafiq’s bank accounts.

Rafiq could be sentenced to more than five years in prison for wire fraud under the terms of his agreement with prosecutors.