Continuing a crackdown on manipulation of microcap stocks, federal authorities have accused the chairman of Endeavor Power and two others of conducting a “pump-and-dump” scheme to raise $1.5 million by selling shares of the medical diagnostics company at artificially inflated prices.

According to the U.S. Securities and Exchange Commission, Endeavor Chairman Edward Withrow III, Canadian citizen Marco Babini, and stock promoter Samuel Brown orchestrated a campaign to hype the stock while concealing their ownership or control over the vast majority of Endeavor’s purportedly unrestricted stock.

The SEC on Monday charged the three in a civil complaint with securities fraud, while federal prosecutors have brought parallel criminal charges against Withrow and Babini. Brown previously pleaded guilty to charges that included making false statements to the SEC.

“We allege that Withrow exploited his executive position to facilitate an elaborate pump-and-dump scheme with Babini and Brown,” Paul G. Levenson, director of the SEC’s Boston regional office, said in a news release. “The SEC is always on the lookout for penny stock company officers and directors attempting to manipulate company stock to line their own pockets.”

“Fraud in the microcap markets is of increasing concern to regulators as such markets have proven to be fertile grounds for fraud and abuse,” the U.S. Attorney’s Office in Boston said.

Withrow became chairman of Endeavor Power in 2012 after a penny stock company he controlled merged with Endeavor, which was controlled by Babini. In October 2012, the SEC said, they spoke with an individual “who Babini understood had facilitated microcap pump-and-dump schemes in the past.” That person was a confidential FBI informant.

Withrow told the informant he was pursuing the Endeavor pump­-and-dump scheme in part “to raise approximately $1.5 million by selling shares of Endeavor stock at artificially inflated prices,” the SEC alleged.

The scheme was ultimately thwarted, the SEC said, when the agency suspended trading in the stock on March 8, 2013, due to concerns about the accuracy of statements in Endeavor’s public filings and press releases.

Withrow was arrested on Monday in Malibu, California, while Babini remains at large, prosecutors said.

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