Bermuda-based Lines Overseas Management has been named as a relief defendant in a US Securities and Exchange Commission civil lawsuit that is probing an alleged pump and dump scheme.

The SEC complaint filed with the US District Court for the Southern District of New York alleges that the manipulation last year of shares issued by Pink Sheets-listed Aimsi Technologies Inc. yielded at least $3 million in illicit trading profits.

LOM itself is not a target of the investigation and is not accused of any wrongdoing.

A LOM spokesman said the company has been named in the suit because LOM?s Bahamas affiliate holds one of nearly 50 accounts held at nearly two dozen banks and brokerage firms that have been identified by the SEC in its probe.

According to the SEC, the brokerage account with LOM?s Bahamas unit ? which was used in the alleged scheme ? was established, owned and controlled by one of the defendants Harris Dempsey ?Butch? Ballow. He recently fled to Panama or Costa Rica after pleading guilty to federal criminal charges in a separate scheme to defraud investors, according to the SEX.

He has previously been found liable for securities fraud and is also accused in another case of manipulating the market for securities fraud.

The SEC probe of Aimsi Technologies ? a company that claimed to be developing a hand-held homeland security device ? accuses Mr. Ballow along with four others of disseminating false and misleading information to drive up the trading volume and price of Aimsi?s stock so they could sell their shares at a substantial profit.

Certain defendants set up offshore entities for the sole purpose of protecting their gains from regulators, the complaint said.

Before trading of the stock was suspended last December, the SEC alleges the defendants had at least $3 million in illicit trading profits.

LOM is listed as a relief defendant alongside 11 others including the Panama-incorporated Wright Family Holdings Inc and Dominican-incorporated Wright family Trust. The SEC said both Wright entities were owned and controlled by Ballow for the purpose of shielding trading profits from scrutiny and controlling trading.

The SEC complaint said that LOM maintained a brokerage account for Wright Family Holdings into which Wright Family Trust transferred ?100,000? pre-split Aimsi shares?.

The shares were placed in an account used by LOM for executing trades in the United States at Boston Sage Deposit & Trust Co which sold them to an account established at TD Waterhouse for this purpose.

The SEC complaint says that WFT and WFH received at least two million shares in Aimsi from the promoter defendants and disposed of all or substantially all of them at a large profit. It has asked the courts to freeze the defendant?s assets and any holdings of the relief defendants of stock in Aimsi.

A LOM spokesman said yesterday: ?As noted in court documents, LOM?s Bahamas affiliate held a single corporate customer account for one of the named relief defendants, however the individual identified by the US regulators as having beneficial ownership of the company does not correspond to LOM?s records.?

LOM?s Bahamas affiliate is in contact with the SEC on this matter, and is co-operating within the bounds of the laws under which it operates.

LOM is also involved in a separate SEC investigation that the securities regulator is conducting into the possible fraud and market manipulation in three stocks.

The SEC is trying to enforce four subpoenas for information issued and served on the company and its managing director Scott Lines.