Authorities in Thailand have arrested a Canadian man accused of masterminding a $140 million plan to defraud investors in U.S. penny stocks.

BANGKOK, THAILAND (AUGUST 21, 2013) (REUTERS) - Authorities in Thailand have arrested a Canadian man accused of masterminding a $140 million plan to defraud investors in U.S. penny stocks, as well as another man who allegedly ran the scheme.

Gregory Curry was arrested there earlier on Tuesday (August 20), the U.S. Attorney's Office for the Eastern District of New York said in a statement. Sandy Winick, the Canadian accused of orchestrating the scheme, was arrested inThailand on Saturday (August 17).

Both now face extradition to New York, the statement said.

The so-called "pump and dump" scheme involved fraudulently pumping up the price of penny stocks and dumping them to investors in 35 countries, prosecutors said.

The group also operated call centres to induce investors to pay fees for non-existent services to sell their illiquid penny stock shares, in a so-called "advance fee scheme," according to an indictment.

The charges against the nine defendants include 24 counts of securities fraud, wire fraud and false impersonation of Internal Revenue Service employees.

Prosecutors said Winick has lived in China, Thailand, Vietnam and the United States.

Others charged include Gregory Curry's son, Kolt Curry. The father and son managed call centres around the world, including in Canada, Thailand and Britain, and were planning to open a call centre in Brooklyn, according to prosecutors. They also prepared false letters, websites and email accounts to deceive potential and actual victims, prosecutors said.