Count 5
The Asia Global Conspiracy
17. At all material times, Asia Global Holdings Corp. (stock ticker: AAGH) ("Asia Global") was a Nevada corporation, with its headquarters in Hong Kong. Until on or about July 17, 2006, Asia Global was known as BonusAmerica Worldwide Corp. (stock ticker: BAWC), with its headquarters in Los Angeles, California. Under either name, Asia Global purported to be in the business, inter alia, of growing businesses within China and other emerging markets in Asia and elsewhere, with a focus upon media, advertising and marketing services.
18. Asia Global's common stock was registered with the SEC and was publicly quoted on the OTC Bulletin Board, www.otcbb.com. Shares of Asia Global constituted "securities" within the meaning of the federal securities laws.
19. From in or about August 2006 through in or about February 2007, in the District of Delaware and elsewhere, MATTHEW W. BROWN, defendant herein, and P.D. and J.M. separately indicted co-conspirators, did conspire and agree with each other and with others known and unknown to the grand jury, to commit an offense against the United States, that is, to willfully and knowingly, directly and indirectly, by use of the means and instrumentalities of interstate commerce, use and employ manipulative and deceptive devices and contrivances, in violation of Title 17, Code of Federal Regulations, Section 240.10b-5, by: (a) employing devices, schemes, and artifices to defraud; (b) making or causing to be made untrue statements of material fact and omitting or causing to be omitted statements of material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading; and (c) engaging in acts, practices, and courses of business which operated and would operate as a fraud and deceit upon any person, in connection with the purchase and sale of a security, in violation of Title 15, United States Code, Sections 78j(b) and 78ff, and Title 17, Code of Federal Regulations, Section 240.10b-5.
Manner and Means
20. It was a part of the conspiracy that defendant MATTHEW W. BROWN, P.D. and J.M. and others known and unknown to the grand jury, sought to artificially inflate market demand for Asia Global shares by manipulating sales in Asia Global stock in a way that appeared to be the product of free and fair market forces. They did this in various ways, including the following:
a. Causing the issuance of millions of shares into the marketplace through the misuse of SEC Rules 16(b) and 144, Section 16(b) of the Exchange Act, and SEC Form S-8, which provides for public registration of the issuance of free trading common stock or options to purchase common stock to "non-qualified" "non-affiliate" company employees, officers, directors, professional advisors or consultants in lieu of compensation;
b. Orchestrating, coordinating, and timing their trading activity to create the false impression of increased market demand for, and liquidity in, Asia Global stock;
c. Engaging in manipulative and deceptive securities transactions to artificially increase the demand for Asia Global shares;
d. Posting messages on on-line message boards regarding Asia Global stock;
e. Coordinating trading activity with the issuance of Asia Global press releases containing false and misleading information; and
f. Liquidating shares of Asia Global stock issued through the misuse of any and all of SEC Rules 16(b) and 144 and Section 16(b) of the Exchange Act. Overt Acts
21. In furtherance of the conspiracy and to accomplish its objects, defendant MATTHEW W. BROWN, and P.D. and J.M., along with others known and unknown to the grand jury, committed the following overt acts, among others, in the District of Delaware and elsewhere:
a. On or about August 4, 2006, defendant BROWN communicated via the instant messaging function of America OnLine with P.D., regarding a scheme to raise money for Asia Global through liquidating shares registered pursuant to a January 6, 2006 SEC Form S-8 filing by Asia Global (then BonusAmerica) ("the January 2006 S-8"). To participate in the deal, P.D. explained that he needed both to control the price of the Asia Global stock and needed press releases to attract investors ("blow it up with news"), which he wanted to review in advance, explaining that "[w]hatever [sector] is hot we can put PR saying they are looking into expanding into that sector." BROWN explained that, while the shares could not go into an account in P.D.'s name, P.D. would have full control over where the Asia Global shares were, and their price.
b. Between in or about December 2005 and in or about August 2006, brokerage accounts were opened at Advantage Investment Strategies ("AIS") for the receipt of and trading in Asia Global shares.
c. Beginning on or about August 9 and continuing through at least December 21, 2006, P.D., through accounts in his name and in the name of Tetrix Financial, bought and sold, and directed the buying and selling, of Asia Global shares.
d. On or about August 14, 2006, defendant BROWN communicated via the instant messaging function of America OnLine with P.D. regarding the market manipulation of AAGH stock, including P.D.'s coordinated posting of messages on on-line message boards regarding Asia Global stock wherein P.D. stated: "I got the entire world on aagh, lol, willys room, panettas room, ihub."
e. On or about August 14, 2006, Asia Global approved the issuance of a total of 7,750,000 shares of AAGH common stock to nine individuals and one entity ("the 2005 Plan Participants"), pursuant to a 2005 Non-Qualified Incentive Stock Compensation Plan described in the January 2006 S-8.
f. On or about August 31, 2006, a total of 7,750,000 shares of AAGH were received into trading accounts held at AIS in the names of the 2005 Plan Participants.
g. Between on or about September 1, 2006 and on or about September 8, 2006, defendant BROWN and P.D., together with others known and unknown to the grand jury, bought and sold, and directed the buying and selling of, all 7,750,000 Asia Global shares out of the 2005 Plan Participant's accounts at MS.
h. On or about August 22 and 24, 2006, defendant BROWN communicated via the instant messaging function of America OnLine with P.D. about the touting of Asia Global stock on on-line message boards, as well as an Asia Global press release, wherein P.D. instructed BROWN to "make it sound good like AAGH announces record revenue net profits increase of 300% etc."
i. On or about August 29, 2006, Asia Global issued a press release claiming that the company's net income for the second quarter of 2006 increased 370% over second quarter 2005 figures.
j. On or about September 1, 2006, defendant BROWN communicated via the instant messaging function of America OnLine with P.D. about the number of shares to be issued in Asia Global's future S-8 filing, wherein P.D. noted to BROWN that Asia Global should "do [a] bigger S-8, 25 mil[lion] shares instead of 15 [million shares] and we'll sell it all extra 10 mil[lion shares] . . . ."
k. On or about September 6, 2006, P.D. communicated via the instant messaging function of America OnLine with N.M. regarding trading in Asia Global stock and issuance of additional Asia Global stock via future Form S-8 filings, noting that because of the size of the upcoming S-8 there was no need to " . . . wait 3 months when u can dump in 1 day."
1. On or about October 16 and 17, 2006, P.D., through accounts in his name and in the name of Tetrix Financial, bought and sold, and directed the buying and selling of, Asia Global shares.
m. On or about November 1, 2006, defendant BROWN communicated via the instant messaging function of America OnLine with P.D. regarding P.D.'s drafting of a future Asia Global press release, wherein P.D. noted that "u have all the prs [press releases] right, except the first one, which im going to work on tomorrow for sure, we need a plan on line up of events and i need to see the damn prs to see which rumor to spread and how to start the damn thing . . . ."
n. On or about October 26, 2006, Asia Global approved the issuance of a total of 25,000,000 shares of AAGH common stock to twelve individuals ("the 2006 Plan Participants"), pursuant to an SEC Form S-8 filed by Asia Global on or about October 27, 2006 ("the October 2006 S-8").
o. On or about November 8, 2006, P.D. caused Asia Global to issue a press release entitled "AAGH Asia Global Holdings Corporation Issues Shareholder Update," purporting to update its shareholders on current events within Asia Global.
P. On or about November 7 and 21, 2006 and December 8, 2006, a total of 26,213,300 shares of AAGH were received into trading accounts held at AIS in the names of the 2006 Plan Participants.
q. Between on or about November 8, 2006 and on or about December 26, 2006, defendant BROWN and P.D., together with others known and unknown to the grand jury, bought and sold and directed the buying and selling of the 26,213,300 Asia Global shares out of the 2006 Plan Participant's accounts at AIS.
r. On or about January 31, 2007, Asia Global filed a Form S-8 with the SEC (the "January 2007 S-8") relating to the issuance of, inter alia, 26,500,000 shares of common stock of AAGH, which were allocated to sixteen individuals ("the 2007 Plan Participants").
s. On or about February 1, 2007, a total of 26,500,000 shares of AAGH were received into trading accounts held at AIS in the names of the 2007 Plan Participants.
t. Between on or about February 1 and 13, 2007, defendant BROWN and P.D., together with others known and unknown to the grand jury, bought and sold and directed the buying and selling of over 24 million Asia Global shares held in AIS accounts.
All in violation of Title 18, United States Code, Section 371.
04/16/2009 3 REDACTED VERSION of 2 Indictment by USA as to Defendant Sealed. (rpg) (rpg). (Entered: 04/22/2009)
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Doc 3
OCR extract
INDICTMENT
Next: Count 6
