Viaspace, Inc. (VSPC)

[hedge_fun]

Is VSPC still tied to terrorist.....

as the Barron's article suggested?

Barron's April 10, 2006

Intelligence Failure

A COUPLE OF WEEKS AGO, onetime presidential candidate and retired four-star general Wesley K. Clark joined the board of ViaSpace, a Pasadena company that says it's applying NASA's technology to the fight against terrorism. "ViaSpace has the technology, expertise and management to deliver important new technologies to the marketplace," Clark declared in a March 22 statement.

ViaSpace (ticker: VSPC.OB) is a $1.60 stock, listed on the over-the-counter bulletin board. I've heard that penny stocks are coming back into fashion, but the 61-year-old retired general's decision to enlist with ViaSpace makes sense to me only as a tragic intelligence failure.

Clark should know his way around Wall Street. Long before he sought the Democratic presidential nomination in 2004, he was a Rhodes scholar and later the supreme allied commander of NATO forces in the former Yugoslavia, before retiring to become a managing director of Stephens, the investment bank based in his home town of Little Rock, Ark. Since February, Clark has been board chairman of the New York investment bank Rodman & Renshaw.

I may be a hack writer, but even I quickly caught wind of the paid spammers who said that ViaSpace shares were headed to $13.50, after Clark's endorsement. I heard of the boiler room in Belgrade telling investors that ViaSpace would have $1 billion in sales, even though it had just lost $2.3 million in 2005 on sales of $432,000. And I didn't have to search long in Securities and Exchange Commission filings or newspaper archives before finding that ViaSpace and its founder, Carl Kukkonen, have been bankrolled for the past five years by a disquieting crew of Vancouver investors.

Among ViaSpace's financiers was one of the directors of the Sikh separatist group that was blamed for the Air India bombing that killed 331 passengers in 1985, as well as an Indo-Canadian gangster whom a British Columbia judge sentenced on March 30 to a prison term of 17 years after a conviction for three brutal kidnappings that were part of a major marijuana-smuggling enterprise.

As I read about the company that Clark had joined, it was all I could do to mince my oaths: Odds Bodkins! Zounds! Over the past three days, I tried to get Clark and Kukkonen to discuss this bizarre company, which tells investors that it's in the business of stopping suicide bombers and improvised explosive devices.

People at Kukkonen's office told me he was on a road show, meeting institutional investors. Clark's assistant said he was in Belgium. But after taking my questions, she called me back Friday with a statement. "Gen. Wesley Clark resigned from the board of ViaSpace after serving for two weeks," she said. "He resigned this morning."

ViaSpace has a lot of shares outstanding: nearly 285 million, by its count, with a free-trading float of 27 million. After the stock fell to a low of 71 cents in January, the paid promoters got on the case. One was Jonathan G. Lebed -- who had gained notoriety as a 15-year-old back in 2000, when he settled an SEC action without admitting or denying that he'd orchestrated an alleged pump-and-dump scheme.

Lebed declared ViaSpace his "big pick" about a week before Wesley Clark signed on. Lebed disclosed that an entity called Maccom Media had paid his firm $50,000 for a two-month promotion of ViaSpace.

At some point, ViaSpace's Website posted a disavowal of the sleazy online campaign. "ViaSpace has not authorized nor paid for these promotional activities," it said. "ViaSpace did not know of these promotional activities, until notified by recipients." But ViaSpace didn't disavow a junk mailing by its outside public-relations firm, Bronks Communications, which mentioned a $13.50 price target for the stock. In nano-sized print, Bronks says it got $548,200 for the job.

The day before Wesley Clark announced his ViaSpace directorship, SEC filings show that ViaSpace sold $1 million in stock to a Bahamain trust called SNK Capital, which now owns over 20% of ViaSpace's stock. In filings for another Nasdaq company (called Fidelis Energy), SNK lists its address and trustee as David Naylor, a 42-year-old Vancouver, B.C., accountant who was treasurer of a little pink-sheet company called Omicron Technologies, which first financed Carl Kukkonen back in 1998 -- when Kukkonen left NASA's Jet Propulsion Laboratory and started talking up space technology.

Omicron Technologies also aspired to become a leading Internet gambling operator with a Website Luckyeightcasino.com. Other Omicron principals include a consultant named Sterling Klein (who also appeared later as an SNK trustee) and Sakwinder Narwal.
In the next couple of years, Naylor, Klein and Narwal appeared as large shareholders in three little Nasdaq-listed shell companies called Super Ventures, Multimod Investments and Easy Com. Those companies were furnished by Omicron's auditor Marvin N. Winick, who had attested to Omicron's financials, even though Ontario's Institute of Chartered Accountants had booted him for professional misconduct in 1992.

Other large investors joined Naylor, Klein and Narwal in the three shell companies. As reported last month in the Vancouver Sun, and documented in SEC filings, they included Jaswinder Singh Parmer, a British Columbia man whose late father, Talwinder, was the suspected mastermind of the 1985 Air India bombing.

According to the Sun, the younger Parmar had been a registered director of the Sikh separatist group Babbar Khalsa, founded by his father.

Another shareholder in the shell companies was a relative of Sak Narwal named Jethinder Singh "Roman" Narwal. Last month, the 30-year old Roman Narwal was convicted in a Vancouver court for three vicious kidnappings, which he told police were related to his pot-smuggling operation. Narwal's lawyer says his client will appeal his 17-year sentence. I tried to reach ViaSpace investor Naylor to ask about these associates, but Naylor's attorney gave me a disconnected number.

Wesley Clark never did tell me why he joined up with ViaSpace.

http://online.barrons.com/article/SB114444881108220544.html?mod=9_0031_b_this_weeks_magazine_tech_week