A Closet (FUNG)

[fung_derf]

HODGES ACTUALLY SPEAKS

odges and Associates Update
« Thread Started Today at 7:23pm » [Quote]
Good evening to all CMKX shareholders. As most of you know my name is Al Hodges; I filed the Bivens lawsuit against past and present SEC Commissioners. I recommend that you read the legal allegations carefully; they will explain what has happened with your investment up through 2009. The only exception to that is for certain items which are prefaced with the words “information and belief;” in that case, the allegations describe what we believe happened.

You were all advised about one month ago of the status of my efforts on behalf of all the shareholders. At that time I advised that I would have a further update when a receipt for Economic Release had been received, or in the alternative I became convinced that such receipt would not be forthcoming in the very near future. I also opined, based on information being provided to me, that I believed such receipt was imminent. Neither has occurred as of this afternoon @ 3:00 PM PST.

In the intervening weeks, I have requested my associate and very good friend, Dennis Smith, to periodically provide some communication to you so that you were aware of our continuing efforts. He has done so as often as possible and each update has been personally approved by me.

We have had multiple reasons over the past few weeks to believe funds were to be released sooner rather than later; on each such occasion I have so advised my direct clients as is my custom and practice in such matters. On occasion, what began as a projected schedule of completion became something quite different when repeated several times over. To the extent that such communication was faulty and engendered confusion and/or false hope among you, the fault is entirely mine; please accept my heartfelt apology.

We were optimistic for early resolution; I remain so. Unfortunately, what is early for one is late for another. When we speak of ‘early’ resolution and ‘imminent’ conclusion, we are speaking within the context of the legal profession and of lawsuits in general which, as many of you know, frequently stretch into years. The last thing we intended or wanted is to contribute to shareholder angst and/or emotional ups and downs. We are well aware of both the financial and emotional plight many shareholders are laboring under. As some of you well know, you do not labor alone in such condition.

As Tramp and many others have suggested, this effort is not about CMKX alone. Receipt of the Economic Release will impact, one way or another, the entire financial structure of US and international activities. Once you can accept the truth of that statement, I’m sure that you can understand that it is a highly technical, complex and multi-faceted undertaking. CMKX has a role to play and we are doing our very best to assist in its successful conclusion.

Many of you have asked what they can do to help further “the cause.” A media blitz may become necessary but would serve no real purpose at the moment. In the meantime should anyone feel they want to do something immediately, simply send a brief note and a copy of the complaint to every mainstream news outlet you can think of; in our view more exposure is likely to lead to additional leverage.

Leverage is beneficial to hastening receipt of Economic Release; it is not required and will have no real impact on the litigation. The lawsuit has and is being served on the defendants. As many of you are aware, the SEC’s General Counsel has agreed to accept service on behalf of the five current Commissioners. In the event that this matter has not concluded after all parties have responded in Court, we will initiate our discovery.

I will do as I said I would do; i.e. you will receive an update from me at such time as we have a receipt for Economic Release or I have reached the conclusion that it is not forthcoming in the very near future. In the meanwhile, please try to understand how very difficult and uncertain this particular time is. I and my associates are working very hard to accomplish what some have asked us to do on behalf of all CMKX shareholders.

A. Clifton Hodges
Hodges and Associates

[fung_derf]

SEC target Brown pleads guilty

2010-02-18 14:34 ET - Street Wire

Also Street Wire (U-*SEC) U.S. Securities and Exchange Commission
Also Street Wire (U-AAGH) Asia Global Holdings Corp
Also Street Wire (U-GHTI) GH3 International Inc


by Mike Caswell

Matthew Brown, operator of the penny stock website Investors Hub, has pleaded guilty to criminal securities fraud and money laundering charges. He entered the plea in a brief appearance before Delaware Judge Joseph Farnan on Wednesday, Feb. 17, 2010. In exchange for the guilty plea, prosecutors will recommend a reduced sentence for Mr. Brown, 26, who faced a maximum of 50 years in jail and fines of $1-million or more. (All figures are in U.S. dollars.)

Prosecutors claim that Mr. Brown and six others manipulated four pink sheets companies, including Ontario-based Playstar Corp., which purported to be developing a proprietary text message system for cellphones. Police arrested Mr. Brown on May 26, 2009, and he pleaded not guilty on June 24, 2009.

Mr. Brown is free on a $50,000 bond pending his sentencing hearing, which has not yet been scheduled. He is the first of his co-conspirators to plead guilty. Another, Florida resident Gerard D'Amaro, is scheduled to change his plea to guilty March 11, 2010.

Brown's indictment

Prosecutors unsealed an eight-count indictment against Mr. Brown on May 21, 2009, in the District of Delaware. The portions that he has pleaded guilty to described the pump-and-dumps of two stocks, GH3 International Inc. and Asia Global Holdings Inc. They also stated that Mr. Brown helped launder proceeds from the Asia Global pump-and-dump.

With GH3, prosecutors claimed that Mr. Brown and others misused Rule 504 offerings to obtain hundreds of millions of shares of the company. Rule 504 normally only applies to accredited investors. Then, in December, 2006, they manipulated the stock with prearranged trades that were timed to coincide with misleading news releases and posts on Investors Hub. The news releases claimed that the company had revenue of $2.1-million and $3-million in 2005 and 2006, and predicted that its revenue would exceed $6-million in 2007.

The indictment claimed that Mr. Brown and the others sold shares of GH3 during the manipulation, although it did not state how many. It said that they transferred $693,000 in proceeds from the scheme to various bank and trading accounts they held. The indictment also noted that Mr. Brown paid a driver $10,000 to take $146,000 in cash from California to Delaware.

The allegations in the Asia Global promotion were similar. Prosecutors claimed that Mr. Brown and the others issued millions of shares to non-qualified investors, and then co-ordinated manipulative trades with false and misleading news releases. The company purported to have the rights to the show "Who Wants to be a Millionaire" in China.

Ahead of the promotion, Mr. Brown received several communications through his America Online instant message program about the timing of the company's news releases. The indictment quoted several of the messages, including one dated Nov. 1, 2006, which stated, "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 ... ." Another, dated Aug. 14, 2006, stated, "I got the entire world on aagh, lol, willys room, panettas room, ihub."

As the company issued misleading news, Mr. Brown and others directed the buying and selling of 26.2 million of Asia Global's shares, the indictment stated. One of the news releases, dated Aug. 29, 2006, stated that the company's net income for the second quarter increased 370 per cent over the second quarter of 2005.

The charges that Mr. Brown pleaded guilty to also included helping one of his co-conspirators, Pawel Dynkowski, set up an offshore bank account to hold money from the Asia Global pump-and-dump. According to the indictment, he travelled to Costa Rica with Mr. Dynkowski on Oct. 21, 2006, to open an account that would be hidden from the U.S. Securities and Exchange Commission. After the men finished the trip, Mr. Dynkowski confirmed in an instant message that his "set up is now 100% sec safe."

While Mr. Brown has pleaded guilty, the cases against most of his co-conspirators remain outstanding. They are Joseph Mangiapane, 43, of California; Pawel Dynkowski, 24, of Delaware; Marc Riviello, 50, of California; Jacob Canceli, 50, of California; Gerard D'Amaro, 38, of Florida; and Angelo "Bill" Panetta, 48, of California. They have all pleaded not guilty, except Mr. Dynkowski, who has not yet entered a plea.

Brown's plea agreement

Prosecutors filed a memorandum setting out a plea agreement with Mr. Brown on Feb. 17, 2010, in court. The memorandum states that the government will agree to a reduction in Mr. Brown's sentence provided he does not do anything inconsistent with accepting responsibility for his actions.

It is ultimately the judge's decision to determine what Mr. Brown's sentence will be, as prosecutors can only make recommendations. Whatever the judge decides, Mr. Brown has agreed that he will not appeal his sentence unless it unreasonably exceeds the sentencing guidelines.

The agreement also contains several asset forfeiture conditions. Among them are orders that Mr. Brown will provide a full accounting of his proceeds from the crime, and will agree to forfeit his interests in any property traceable to the proceeds of crime. Mr. Brown has also agreed to voluntarily enter the inmate financial responsibility program. This means that while in jail, the Bureau of Prisons will collect a portion of his prison salary and apply it to the payment of his debt.

SEC case

In addition to the criminal charges, Mr. Brown and his co-conspirators are facing a civil suit from the SEC. That case, filed on May 21, 2009, alleges that the men made $6.2-million pumping and dumping Playstar, GH3 International, Asia Global and Xtreme Motorsports of California Inc.

The SEC belatedly halted GH3 on Dec. 24, 2009, stating that publicly available information on the company was questionable.

"these posts are not of a licensed investment advisor or analyst nor does he give out buy, sell or hold advice to anyone"

[fung_derf]

O.C. stock board founder pleads guilty to fraud
February 17th, 2010, 2:07 pm · Post a Comment · posted by Ronald Campbell
Matthew Brown, founder of Orange County stock board InvestorsHub.com, pleaded guilty today to four counts of stock fraud and money laundering. He faces up to 20 years in prison and a $500,000 fine. Brown entered his plea in U.S. District Court in Delaware.

Federal prosecutors charged Brown and six others with a pump-and-dump scheme to hype five lightly traded stocks on InvestorsHub, drive up the price and then sell. In his plea agreement, Brown admitted that investors lost at least $1 million because of his scheme.

Prosecutors said Brown and the others arranged with help from insiders to gain control of millions of shares in the target companies. Then they spread glowing rumors on InvestorsHub and other stock boards, prompting unwitting buyers to rush in. Then they sold.

A key figure in the case, Polish citizen Pawel Dynkowski, also known as “Evo”, remains at large, Assistant U.S. Attorney Shannon Hanson said.

Another defendant, Gerard D’Amaro of Lighthouse Point., Fla., is scheduled to change his plea from innocent to guilty on March 11, Hanson said.

Since the original indictment of Brown, Dynkowski, D’Amaro and two others last May, a federal grand jury indicted two more alleged participants, Florian Ternes and Richard Bailey. They were insiders at one of the target companies, GH3 International, and allegedly arranged to provide 312 million shares for the scheme.

Read Brown’s plea agreement here. Read our May 2009 coverage of the first indictments and Securities and Exchange Commission lawsuit here.

http://ocbiz.freedomblogging.com/2010/02/17/o-c-stock-board-founder-pleads-guilty-to-fraud/16849/

[fung_derf]

Frank Love and his latest venture...

[fung_derf]

I can't verify this to all be accurate, but some of it is, so I'd consider the rest to be very probable.....

I have to beleive GARY WALTERS...based on this truthful information:

WHEN JOHN EDWARDS GOT MORE INVOLVED, HIS PARTNERS FROM THE PCBM MANAGEMENT GROUP JEFF AND VINCE AND ARE THE ONES THAT ACTIVLY PROVIDED THE RETAIL OF THE CMKX STOCK

EDWARDS WAS THE ONE REALLY DUMPING AT THE TIME.



Gary Walters chimes in on the Vegas Gang
« Thread Started on Today at 2:54pm »

--------------------------------------------------------------------------------
I’m going to try and keep this simple, so it’s easier to read and understand, but let’s take a “excerpted” review of how Gary Walters chooses to describe his cohorts in the “Vegas Gang”, noting that he himself is charged with some 30 counts of stock forgery and securities fraud. Keep in mind that Walters “ran” Nanosignal – it’s where his personal priorities lie.

Walters has been hung out to dry by his cohorts, and he’s been firing back with both cannons for about a year now. Is it all true? Doubt it. But it is an interesting read. Note: the timeline goes back pre-CMKX and carries forward into the present.

Also, at my own liberty, I’ve corrected several spelling and syntax errors, so Walters ramblings are easier to follow. I also left long and unrelated “ramblings” out. However, I did not take out any references to UC. Walters words are in green.

Recall that Exxcode merged with Nanosignal. Some lawsuits ensued back and forth. Dvorak wrote a letter on behalf of Exxcode concerning “shares due” to about a dozen trusts – 8 or 9 of which have (A) been linked to Edwards, and (B) appear on the CMKX shareholder list:

RICK TAULLI AND SHAWN HACKMAN DID THE BOX JOB ON EXXCODE , THEY HAD BRIAN DEVORAK DO THE LEGAL OPINION , IT WAS SHAWN HACKMAN AND RICK TAULLI WHO DID THE S4 AND HAD BRIAN DEVORK SIGN OFF ON IT AS THEY PREPARED IT IN HACKMANS OFFICE

RICK TAULLI FORWARD SPLIT THE COMPANY SHELL EXXCODE INC AND USED PHONY TYPED CHEAP STOCK CERTS ETC.

THEY CREATED JOHN EDWARDS GROUP OF NOMINEES THAT THEY PAID INTO MICRO SIGNAL

MAT M. GOT 150K RICK CREATED 25 MILL FOR EDWARDS GROUP AND THEN 25 MILL FOR HIM RICK TAULLI , SHAWN HACKMAN , AND BRIAN DEVORAK.

WHEN EDWARDS DECIDED HE WANTED OUT HE HAD HIS MUSCLE MEN VINCE AND ? THREATEN ME TO RETUN 200K TO THEM. BOBBY MCALISTER DOWN IN FLORIDA KEPT 2.5 MILLION SHARES AND EDWARDS KEPT 1.5 MILLION SHARES.

JOHN EDWARDS WANTED OUT BECAUSE HE SAW THE FUED BETWEEN RICK TAULLI AND THE OTHERS HEATING UP.

LATER EDWARDS STAYED WITH TAULLI AND TAULLI ENGINEERED AND CRAFTED MORE BOX JOBS..I SUED EDWARDS IN STATE COURT IN NEVADA AND JOHN EDWARDS CAME TO THE TABLE FAST. WE MET OUT AT THE CONTRY KITCHEN ON RAINBOW AND THERE HE GAVE ME A BROWN ENVELOPE SEALED AND SAID DID YOU BRING THE CASH , HE HAD A MUSSEL GUY WITH HIM NAMED ?? ANYWAY EDWARDS COUNTED OUT THE 250K AND THEN GAVE ME THE ENVOLOPE AND SAID NICE DOING BUSINESS WITH YOU IT IS ALL THERE ALL 25 MILLION SHARES. WELL IT WAS NOT ALL THERE.

Note: I believe I’ve read an article by Lee Webb suggesting that John Dolkart is John Ed Dhonau (if I’m wrong, someone please correct the record)

I WAS FREAKING OUT , SO I CALLED JOHN DOLKART HE HELPED ME IMMEDIATLY DRAFT A LAW SUIT AGAINST EDWARDS AND HIS STOCK HOLDERS ETC THAT EDWARDS CLAIMED WERE HIS CLIENTS.

For recollection, recall that the Zamans (who are connected with BBX Equities) were connected to a huge pennystock scam and charged and convicted in the Sky Scientific stock fraud. Cook is our past attorney (Thomas C Cook, the one who was to be holding UC’s shares in escrow).

SEEMS LIKE THE GRAND JURY WANTS ANOTHER INTERVIEW WITH TUALLI, ZAMAN, GARCIA, SCARA AND A FEW OTHERS - HACKMAN TO. NOW WE ARE GOING TO THROW COOK IN THE MIX WITH CONVITED FELLONS.
[speaking to Tualli]

ROBERT GARCIA IS THE ONE WHO SOLD YOU HIS OWNERSHIP IN THE 2808 COWAN CIRCLE RESIDENSE IS HE NOT? AND HE TRIED TO SCAM AN INSURANCE COPMPANY OUT OF MONEY ON THAT SAME HOUSE YOU TOLD PEOPLE YOU BOUGHT FOR 800K . YOU ALSO SAID YOU PUT 150K INTO THE HOME , BUT YET YOU SHOW TO THE IRS THE VALUE OF THE HOUSE IS 4OOK. ARE YOU FRAUDING THE IRS TOO, RICHARD A TAULLI?

YOUR GROUPIES AND THE EDWARDS GROUPIES - THE FEDS HAVE YOU ALL NOW COMMING IN AND, BY THE WAY, WAIT TILL YOU SEE ALL THE CONFLICTS BETWEEN LAWYERS BUDDY PLANS TO WRITE EACH OTHERS GHOST STORY...

Note: Desormeau participated heavily in the B&B Farms scam – also it’s interesting that he walked away with all of B&B's computers...

SEEMS LIKE COOK AND DEVORAK WERE THE SAME TWO ATTORNIES FOR CMKX AND BARRINGTON FOODS, AND BB WORM FARMS , WOW WHAT A LINK TO THEM...THEFT IS JUST AT YOUR DOORSTEPS NOW!!!!! HOW CAN YOU BE PAID BY A COMPANY AND YOU NOT ONLY PLOT TO STEAL THERE BUSINESS AND CLIENTS BUT YOU EVEN FABRICATE PHONY STOCK AND STOCK HOLDERS.

Ok, I’ve posted this previously – it’s seemingly the same rendition of many of the events listed above, except here Walters is making a defensive response to my interview with John Jarvis, where Jarvis claimed Walters was the main promoter in the CMKI deal. (In other words, Jarvis said it was Walters who flew to Houston to pitch the CMKI deal - Jarvis said the plan was to merge several shells into CMKI, with CMKX being only a holding company). Now, which one’s telling the truth? Are either? Both Jarvis and Walters are scum, I’m sure of that.

GARY WALTERS NEVER EVER TALKED TO JOHN JARVIS ABOUT ANY SHELL FOR CMKX.

THE REAL MATTER IS THAT DON DICKSON INTRODUCED JOHN EDWARDS TO JOHN JARVIS.

THAT DEAL WAS BOUGHT BY JOHN EDWARDS LONG BEFORE ANY CONSIDERATION OF THE CASSAVANT DEAL CAME INTO PLAY.

GARY WALTERS AND MIKE MYERS MET URBAN CASSAVANT ONE MORNING IN A HOUSE BELONGING TO BETESTA IN SPANISH TRAIL.

THERE THEY WERE SHOWN MAPS AND THE LIKE OF DIAMOND MINING CLAIMS BY URBAN CASSAVANT IN SA. CANADA ,

IT WAS GARY WALTERS WHOM TOLD DON DICKSON ABOUT THE CASSAVANT MINING DEAL

IT WAS DON DICKSON WHOM INTRODUCED JOHN EDWARDS AS THE MERCHANT BANKER THAT WOULD MOST LIKELY PROVIDE THE SHELL TO DO THE DIAMOND DEAL

EDWARDS AND COFFEY CONJURED UP THE STOCK ISSUANCE PLANS AND RECORDS WILL PROVE IT ALL.

URBAN GAVE GARY WALTERS 200 MILLION SHARES FOR HIS INTRODUCTION AND OTHER CONTACTS, AND TO HELP WITH THE IR.

WHEN JOHN EDWARDS GOT MORE INVOLVED, HIS PARTNERS FROM THE PCBM MANAGEMENT GROUP JEFF AND VINCE AND ARE THE ONES THAT ACTIVLY PROVIDED THE RETAIL OF THE CMKX STOCK

EDWARDS WAS THE ONE REALLY DUMPING AT THE TIME.

LATER EDWARDS CALLED A MEETING AT CESEARS PALACE WITH GARY WALTERS VINCE AND JEFF. IT WAS JEFF WHOM BLAMED GARY WALTERS IN SHORTING THE STOCK OF CMKX AND STEALING MILLIONS OF DOLLARS THEY CLAIMED WAS TO BE THEIRS. IT WAS HEATED AND YELLING AMONG ALL OF THEM.

THE NEXT DAY JOHN EDWARDS CAME OVER TO THE COWAN CIRCLE HOUSE AND WANTED TO SEE THE 2 CERTS GW HAD FOR A 100 MILL SHARES EACH , GW TOOK EDWARDS UPSTAIRS AND SHOWED HIM HE HAD HIS CERTS INTACT.

THEN JOHN EDWARDS ATTEMPTED TO WANT TO TAKE THEM BUT GW ONLY ALLOWED HIM TO MAKE COPIES AND TAKE THEM WITH HIM.

THE NEXT DAY URBAN CALLS GW AND SAYS WE WANT TO BUY YOU OUT COMPLETELY , WE HEAR YOU ARE VERY UPSET, GW SAID YES I AM UPSET YOU SQUANDERED 2 MILLION DOLLARS AT HARAHAS AND OTHER CASINOS ETC , AND THIS MADE GW FERIOUS.

THE FACT IS, IT WAS JOHN EDWARDS WHOM HAD ALL THESE NOMINEES AND LOTS OF CMKX STOCK TO SELL. GW BELIEVES JOHN EDWARDS STOLE ALOT OF MONEY FROM THE OTHERS IN BED WITH HIM AND THEY WERE MAD.

THEY BOUGHT GW OUT FOR A HEAFTY SUM. CASH DEALS WERE MADE AND PAID TO GW AT THE COMMUNITY BANK ON RAINBOW.

GW EVEN HAD TO DO RADIO SHOWS FOR URBAN BECAUSE HE WAS ALWAYS DRUNK ETC,

THERE WAS A BOBBY MACALISTER WHOM TOOK ALOT OF SHARES BELIVED FROM EDWARDS AND NEVER DID ANYTHING FOR THEM AT ALL.

THEN WHEN GW CAUGHT SHAWN HACKMAN AND RICK TAULI AND BRIAN DVORACK BOXING STOCK AND COUNTERFITTING IT TO GET LOTS OF AQ SHARES FREE TRADING.

3 DAYS LATER SHAWN HACKMAN WAS INDICTED FOR THE VERY SAME THING RICK TAULI DID - BOXING STOCK PUTTING IT IN THE NAME OF HIS GIRLFRIEND AND OTHERS IN THE BOXED STOCK, KNOWING DAM WELL THAT THEY HAD NO MONEY OR CHECKS INVOLVED .

RICK TAULI IS STILL DOING DEALS WITH JOHN EDWARDS, AND CIRCUMVENTING, CHEATING, LYING, BACK DATING DOCS, FABRICASTING THEM FOR THE HIS CHEATING OCCASSIONS AND FOR OTHERS’

[fung_derf]

OVERSTOCK CEO PATRICK BYRNE REPLIES TO HEDGE FUND CHOAGIES: WE’RE THE GOOD GUYS, YOU’RE THE BAD GUYS

“It isn’t what we don’t know that gives us trouble, it’s what we know that ain’t so.” – Will Rogers

I have spent five years trying to expose and disrupt bad behavior on Wall Street. I conducted this campaign through public appearances and DeepCapture.com, a site of investigative journalism I fund. Those I have attempted to expose have sought to prevent public understanding of my claims by generating a mish-mash of things for the public to “know [but] that ain’t so.”

Henry Blodget has graciously invited me to respond to them here. When some years ago Henry first wrote of me he prefaced his thoughts with something along the lines of, “I’m the last guy in the world to criticize someone for what he puts in an email, but…”: that, and the present invitation to which I now respond, demonstrate to me that Henry has a sense of intellectual integrity and, it appears, humor. I thank him for his invitation, and welcome this chance to set the story straight.

I will do so in three sections: The Fight, The Result, and The Cover-Up.

THE FIGHT

My argument can be expressed in three points:

1) Participants in our capital market take for granted the settlement system running behind the scenes, but more slop exists in that settlement system than is commonly understood.

2) Stock manipulators can employ this settlement-slop when they conduct bear raids. One of their techniques is “naked short selling” There are others that are not, technically, “naked short selling” but which have essentially the same effect (e.g., failed long sales, failed offshore deliveries, abuse of the option market maker exception to create married puts or “bullets”, swaps, daisy-chaining, “bed-and-breakfasting” and perhaps other methods understood only by a handful guys who are bright lights in that lofty firmament which is Caribbean banking).

3) In August, 2005 I gave a webcast (“The Miscreants’ Ball”) where I discussed the pattern of modern bear raids. The pattern I described included such elements as:

a) a group of hedge funds which seemed to be on the scene wherever stock manipulation occurred;

b) some putatively independent analysts and journalists who seemed to be shilling for those hedge funds;

c) an “independent” research shop named Gradient who was writing hatchet-jobs on cues given by hedge funds like Rocker Partners (I made public affidavits from three ex-Gradient employees attesting to this and to reporter Herb Greenberg’s participation in the scheme);

d) Milberg Weiss, a class-action law firm which filed lawsuits in coordination with these bear raids;

e) Jim Cramer, the man in whom the stock manipulators and journalists seemed to intersect;

f) Eliot Spitzer, a New York Attorney General with problematic ties to this group;

g) and the SEC, whom I accused of not protecting the public due to having grown inappropriately close to powerful Wall Street interests.

In closing, I suggested that this network centered on someone I referred to as “the Sith Lord”. In interviews that followed I explained this by repeating a specific formulation: “I really think in terms of a composite of two people. Someday I might sack up and let the world know who the master minds are, but not now” (a hint broad enough for Wall Street to understand, I assumed).

Note that while the Miscreants’ Ball was occasioned by a lawsuit Overstock.com had filed, little of it (less than ¼) actually concerned Overstock. The remaining ¾ of the webcast mapped this pattern of bear raids in our markets.

I followed up on the Miscreants’ Ball with a three year campaign expounding on the possibility that these manipulative techniques were creating a settlement residue which degraded corporate voting, destroyed firms, and might be destabilizing the financial system.

THE RESULT

Since that day in 2005:

1) Milberg Weiss imploded under DOJ indictment, and its leaders were jailed, for using “paid plaintiffs” (i.e., shills). The indictment has a remarkable line (pages 29-30) to which no journalist has turned attention: “Unlike the other class members in the Lawsuits, the Paid Plaintiffs purchased the securities at issue anticipating that the securities would decline in value, in order to position themselves to be named plaintiffs in securities fraud class actions and to obtain kickback payments from MILBERG WEISS, BERSHAD, SCHULMAN, and others.” No journalist has yet asked, How did Milberg Weiss know which securities to direct its “Paid Plaintiffs” to purchase, and why were they “anticipating that [those] securities would decline in value”? Are Lerach and Weiss stock pickers?

2) Jim Cramer appeared in a video recounting how his hedge fund engaged in practices that he described as illegal but common, practices that were precisely what I had alleged (Cramer’s lawyers had managed to get that video removed from every spot on the Internet except DeepCapture, and I am proud it played a role in Jim’s undoing at the hands of Jon Stewart);

3) Eliot Spitzer suffered his well-known comeuppance with Ashley Dupre (no disrespect to these fine ladies intended). Less discussed is the fact that Ashlee turned out to be living rent-free in the home of Jim Chanos, a hedge fund manager who was both one of Spitzer’s earliest and largest supporters, and a key member of the network of hedge funds I had been spotlighting. So far the press corps has accepted that as coincidence, apparently assuming that one day Eliot Spitzer just picked up the Yellow Pages and called a cat-house. The possibility that hedge funds may have been involved in the procuring of Ashlee or her colleagues, and thus enjoyed joint ownership of the Attorney General of the State of New York, is something that to my knowledge only one national publication is pursuing.

4) In late 2008, Gradient settled with Overstock, issuing apology for and retraction of their scurrilous claims (sums paid, if any, have not been disclosed). In late 2009, Rocker Partners paid Overstock $5 million to settle for its part in the scheme (without admitting said scheme’s existence, to be fair).

5) Much correspondence among hedge funds, journalists, analysts, hired thugs, and Mafiosi has gotten public (some in essays published on DeepCapture, some in actions taken by the feds), and it reveals precisely the relationships which I had posited in that call.

6) Bloomberg Magazine published “The Corporate Voting Charade”, an investigative piece by Bob Drummond, describing how slop in our settlement system makes corporate elections a “sham”. As Drummond wrote, “the results of high-stakes company decisions may hinge on the invisible influence of millions of votes that shouldn’t be counted, says Thomas Montrone, chief executive officer of Cranford, New Jersey–based Registrar & Transfer Co., which oversees shareholder elections. ‘It is an abomination,’ Montrone, 58, says. ‘A lot of the time we have no idea who’s entitled to vote and who isn’t. It’s nothing short of criminal.’” Drummond proceeds, “There are votes cast twice on almost every matter of substance,” Hagberg, 63, says. “It definitely can and does, in my experience, affect the outcome of corporate elections and proposals.”

7) By 2008 numerous journalists were covering how companies were destabilized by these techniques of settlement-system gaming. Bloomberg TV did a half hour Special Report, “Phantom Shares”, that was nominated for an Emmy – Long Form Investigative Journalism.

8) In 2008’s systemic crisis settlement-gaming was repeatedly implicated:

a) Two Wall Street firms which had been saying the crime of naked short selling didn’t exist went under screaming it had been their undoing;

b) The SEC implemented an unprecedented emergency order to protect our financial system from the crime they had been saying didn’t exist;

c) In autumn, 2008 regulators from the G-20 held emergency meetings directed towards keeping the financial system from Chernobylling from this non-existent crime;

d) Also in autumn, 2008, the SEC finally closed some of the settlement loopholes that enabled the crime that didn’t exist, and several hedge funds (including Rocker Partners) imploded when the loopholes they weren’t using were suddenly closed.

9) In December, 2008, Bernie Madoff turned himself in, and everyone from 60 Minutes to the United States Congress learned about “regulatory capture” and the SEC under George Bush;

10) As I write, feds seem to be rolling up a network of hedge fund players, and press reports put at the center of that network one Steven A. Cohen, or “SAC” as his fund is called (while the hedge fund community reduces its ties to SAC, Reuters recently killed a story on Cohen, at his request).

So may we agree that the DeepCapture Team turned out to be at least directionally correct?

THE COVER UP

When I started my campaign I was curious to discover how far extended the intellectual corruption of the New York financial press. I mapped it with sonar-pings, and in time became convinced that, with some exceptions (notably, several Bloomberg journalists, Fox Business, and a few islands of reporters isolated here and there) the bulk of the New York financial press lack a faculty for critical thought and the courage to take a position contrary to a well-accepted truth, and a few are actually hostile to truth. If I were still teaching, I would say that most performed like Continental Philosophy hysterics forced to take an econ class. Their conformity and indolence permitted a cover-up to persist.

1) Their list of Wash-Rinse-Repeat instructions was short:

a) Do not report what Byrne is saying about bear raids; pretend he is just talking about Overstock.

b) Do not report what Byrne says about naked short selling; pretend he is talking about Overstock.

c) Pretend not to understand the “Sith Lord” reference. It’s a metaphor. Say: “Who uses metaphors? That’s crazy, right?”

d) Prime directive – Do not feed the “bear raids” meme. Bear raids do not exist.

2) The social media cover-up: DeepCapture.com ‘s investigative journalist/technologist Judd Bagley acquired a computer filled with emails that confirmed the relationships among hedge funds and law firm cut-outs, convicted stock manipulators, message board posters and Wikipedia sock-puppets that all sane observers already saw. This network conducted the following activities:

a) Two million pages on Wikipedia run by one set of rules. The page on Naked Short Selling runs by a different set of rules. In what became the largest internal scandal in Wikipedia’s history, it turned out that a down-and-out journalist named Gary Weiss had been given control of this page by the Wikipedia higher-ups. In fact, Weiss ultimately made a mistake that revealed he was manipulating social media from within the DTCC, the Fort Knox-like corporation at the heart of the settlement system, as Judd Bagley uncovered. What followed was an enormous Wikipedia civil war in which, ultimately, the Wikipedia community caught Gary Weiss red-handed. The Register, a British on-line publication focusing on Silicon Valley, covered this story extensively. Their first stories were skeptical, but as a staggering amount of evidence accumulated in support of them, they shifted sides and confirmed what we had been claiming: “reporter” Gary Weiss was part of a remarkable campaign to manipulate social media to cover up financial crime.

b) We and our sympathizers were frequently threatened. One journalist who took our side was jumped, beaten up, and told to stay away from this story. One fellow traveler, Dave Patch, saw his and his wife’s names, addresses, and social security numbers posted at an online message board. Mary Helburn (another fellow traveler) saw someone using as aliases the names of her nephew (a head-injury-survivor) and deceased sister to post nasty and vaguely-threatening messages. Judd Bagley, an investigative journalist who works for DeepCapture, saw the names, ages and home address of his two young daughters posted online by Sam Antar (naturally, shortly thereafter Sam became a favored presense for Fortune Magazine and CNBC). None in the press would report on any of this. However, in a display of selective outrage which demonstrates the low intellectual integrity of which I write, when Judd recently documented and questioned the appropriateness of the fact that the hedge fund folk and the journalists of whom we write are Facebook Friends with each other (which one would not see, for example, among political reporters and the politicians they cover), that was written about as though it were an incredibly intrusive thing for Judd to do, even though the material he assembled was already self-published on Facebook by those later claiming it was intrusive of Judd to gather and display. Interestingly, in their stories criticizing Judd most choagies went far out of their way to bury mention of DeepCapture (some did not even mention it at all, though that is where Judd’s work appeared). Instead, “Overstock” was substituted for “DeepCapture.com”, my name for Judd’s (at least in titles), they claimed it was “hacking” when no hacking occurred (they’re just technologically illiterate), and they write of lists of “Overstock’s enemies and critics” when, in fact, this and most of what Judd writes nothing to do with Overstock. This song isn’t about me: it’s about the extraordinary deference show by the financial press to some bear raid-conducting hedge funds. But that is the meme that must be suppressed.

A year ago DeepCapture was voted the Internet’s Best Business Blog, and recently, named best for Business Investigative Journalism. The Wall Street Journal graciously listed mine as among the “Best Calls of 2008”, and CNBC talking heads recently acknowledged we turned out to be right all along. Ye the CNBC/Fortune/New York Times crowd, who once leapt on obscure issues related to me (Herb Greenberg wrote a story the thesis of which was that sometimes I answered emails quickly, but sometimes slowly), went mute as soon as we launched DeepCapture. I believe they realized from that point forward reporting on my allegations would require mentioning DeepCapture, which would make it too easy for the public to investigate. They thus suddenly ceased coverage altogether, or only engaged in circumlocution-filled slurs. When DeepCapture blossomed the choagies lost control of the narrative, so their best hope became to avoid its mention.

http://www.deepcapture.com/the-illustrious-henry-blodget-thinks-i-am-a-very-bad-man-part-2-the-essay-business-insider-requested-then-refused-to-publish/

[fung_derf]

gusjarvis lawsuit?

By: gusjarvis
01 Feb 2010, 09:40 PM EST
Rating: Rate this post: Msg. 907662 of 907779
Jump to msg. #


PART ONE:

No E85268

Kelowna Registry


IN THE SUPREME COURT OF BRITISH COLUMBIA


BETWEEN: CMKX SHAREHOLDERS COALITION FOR JUSTICE
Plaintiff

AND: THE US SECURITIES AND EXCHANGE COMMISSION
Defendant


AFFIDAFIT

I David Nelson, of #101 1865 Dilworth Drive Kelowna British Columbia, MAKE OATH AND SAY AS FOLLOWS:

1. I am the Plaintiff in this proceeding and as such have personal knowledge of the matters and facts hereinafter deposed to, save where stated to be on information and belief and where so stated I verily believe the same to be true.

2. In the CMKX SHAREHOLDERS COALITION FOR JUSTICE VS. THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION , Kelowna Registry No. S 85268, the CMKX Shareholders Coalition for Justice (The Coalition) entered evidence showing the United States Securities and Exchange Commission (SEC) did collude with the corrupt management of CMKM Diamonds Inc. (CMKX). A detailed paper showing collusion between CMKX management and the SEC was presented as evidence in the November 6th writ of summons and is presented here: http://www.cmkx.info/evidence.pdf.

3. CMKX represents the largest counterfeited stock in history (per attorney Al Hodges comment letter to the SEC file number S7-08-08). It was counterfeited by insiders of CMKX with the full blessing of the SEC along with many other firms. The SEC was fully aware of John Edwards, a corrupt insider of CMKX, who is currently indicted by the DOJ, laundering money (selling unregistered shares) through various accounts at NevWest Securities Corp. years before they took action. The evidence is in the phone records of NevWest Securities Corp., who contacted the SEC each time Edwards came in with a cert to sell through different accounts, which were based in Langley, British Columbia, Canada. Instead of stopping the fraud, the SEC told NevWest Securities Corp. to sell the stock, effectively aiding the fraud. Instead of taking action the SEC and NASD (FINRA) ignored the evidence and dozens of other red flags, allowing the scheme to continue unabated, costing CMKX shareholders hundreds of millions of dollars.


4. The SEC and a task force from the FBI/DOJ/IRS and others subpoenaed records that proved insiders of CMKX were laundering money through the Silver State Bank and selling counterfeit stock on September 5th 2004, after which they allowed the fraud to continue despite having this evidence and allowed hundreds of billions of unregistered shares to trade and cost CMKX shareholders hundreds of millions of dollars. At the same time the SEC was in contact with CMKX attorney, and former SEC attorney, Roger Glenn who it appeared facilitated this fraud. They were fully aware of the fraud, and through its negligent actions and inactions the SEC caused CMKX's scheme to continue, perpetuate, and expand, eventually resulting in millions of losses by investors.

5. Given the ease it was to prove the collusion of the SEC and corrupt CMKX management, and given the fact that a task force from the RCMP/FBI/DOJ/IRS/SEC had all the evidence they needed in 2004 to stop this fraud and allowed the fraud to flourish and be promoted, it was assumed this was a sting operation by many shareholders who documented the evidence over years. Mark Faulk, ex CEO of CMKM Diamonds Inc. said, “there are unconfirmed reports of a major sting operation targeting dozens of others involved in the CMKX scandal”. He later denied this fact due to signing non-disclosure agreements. The company itself due to strict non-disclosure agreements and the SEC along with other agencies involved would not confirm this fact, so the CMKX Shareholders Coalition for Justice put together a paper showing the collusion between the SEC and CMKX management, along with other evidence, and filed a case against the SEC on November 6th, 2009. Evidence presented in the Coalition’s writ, which will be added to this affidavit, clearly show the SEC has aided and abetted the systematic counterfeiting of the stock market for over a decade, and CMKX in particular. And although the SEC has participated in several sting operations with many different agencies with the appearance of fighting the counterfeiting of the stock market, the crime and its cover-up continue to this day. Although the SEC has identified hundreds of victim companies and know exactly who the perpetrators are on Wall Street, evidence will show the SEC has gone after the victims and shielded the perpetrators from almost any criminal prosecutions, despite the fact that the crime has cost retail investors multiple trillions of dollars.

6. The fact that CMKX was a sting operation has now been confirmed subsequent to the filing the Coalition’s writ of summons on November, 6th 2009, which is pertinent to our case as it explains the collusion that was proved in our case was for a purpose. In case number CV10-00031-JVS (MLGX), A. Clifton Hodges, State bar No. 046803, filed a complaint in the United States District Court Central District of California against the SEC for 3.87 trillion dollars on January 10th 2010. The case confirms CMKX was used as a vehicle in a sting operation, and statements made in the case are now confirmed by talks taking place to release the money from the frozen trust accounts between Al Hodges and the SEC and other Government entities. In preparation for my filing I have had discussion with Al Hodges and he has confirmed directly to me that these trusts are there and the funds have been collected. His lawsuit is only to force the release of the already collected funds. These trust accounts hold monies from perpetrators who made deals to stay out of jail for their crimes and from proceeds from land sales. Several plaintiffs who hired Al Hodges in this case have confirmed on public forums that talks and actions are ongoing to release these monies, but the U.S. Government has repeatedly lied about the release of those funds, including sending codes to release the money that did not work, and that money was missing out of the trust fund when access codes worked. Hodges and Associates confirmed that these comments were from plaintiffs in this case. Al has confirmed in his suit that the SEC has lied to CMKX shareholders representatives for years about imminent release of the shareholders trust accounts. Many shareholders have died while waiting for their Government to release their property that was illegally being held from them. This information proves that the evidence presented in Al Hodges case is corroborated given they are in the process of getting the funds released by the United States government that were collected in the sting operation. The continued lies by the United States government and stalling of release of these funds forced Al Hodges to finally file a 3.87 trillion dollar Bivens based class action law suit against members of the SEC and FBI. To this moment the United States Government is saying the release of funds is imminent but thousands of shareholders sit watching daily as they are lied to again and again. The fact that the SEC has lied to lawyers representing CMKX shareholders follows their modus operandi in many other well known cases which will be presented as evidence. Evidence gathered for this case show complete collusion of the SEC with the perpetrators in the theft of trillions of dollars from retail investors by systematically counterfeiting all kinds of financial instruments including stocks and treasuries. Comments made by Bud Burrell (file No. S7-19-07 to the SEC), consultant for John O’Quinn who has a multi trillion dollar class action going against the same perpetrators, says that failure to delivers (counterfeit stock) is now over thirteen and a half billion dollars a day, and that there is more naked short shares in the market than there is outstanding shares. Facts will be presented that show the United States Government and Canadian Government worked together to fight this pandemic fraud, but that the SEC in fact aided the fraud by their actions and inactions, and that they are a totally captured regulator by the industry they are suppose to regulate.

7. To focus on the CMKX situation first before focusing on the overall fraud, one has to look at the evidence presented by Al Hodges. Before actually filing his lawsuit Al Hodges gave the SEC the chance to release the funds collected for the shareholders, and in a litigation update to his plaintiffs on December 16th Al Hodges included this statement: “During the period from March, 2004 through August, 2006, on behalf of CMKM Diamonds, Inc. Robert A. Maheu, with assistance from Royal Canadian Mounted Police…, negotiated a settlement with the illegitimate brokers, dealers, market makers, hedge funds, and other persons and entities that had engaged in naked short selling of CMKM Diamonds Inc. stock and cellar boxing the company. In exchange for a U.S. Government promise of no prosecution for such sales, the wrongdoers each promised to pay negotiated amounts to a frozen trust for disbursal at a later time.”

8. Paragraphs 8 through 17 contain excerpts from case CV10-00031-JVS (MLGX) which are relevant to The Coalition’s case, quotes that are again corroborated by the fact the SEC and or United States Government officials to this day are promising imminent release of these funds. Al Hodges case confirms what Al stated in his comment letter to the SEC, that CMKX was the largest naked shorted stock in history, “During the period of June 1, 2004 through October 28, 2005 a total of 2.25 Trillion “phantom” shares of CMKM Diamonds Inc, was sold into the public market through legitimate brokers, illegitimate brokers and dealers, market makers, hedge funds, ex-clearing transactions and private transactions. The sales of the majority of such shares were at all times known to the Securities and Exchange Commission, including Defendants herein.”

9. “At some date prior to June 1, 2004 the Securities and Exchange Commission in concert with the Department of Justice of the United States, together combined with Robert A. Maheu and others to utilize CMKM Diamonds, Inc. for the purpose of trapping a number of widely disbursed entities and persons who were believed to be engaged in naked short selling of CMKM Diamonds Inc. stock and cellar boxing the company.”

10. “The Securities and Exchange Commission and the Department of Justice, with assistance from the Department of Homeland Security, believed and developed evidence that said short sellers were utilizing their activities to illegally launder moneys, wrongfully export moneys, avoid payment of taxes, and to support foreign terrorist operations. To fulfill the plan to criminally trap such wrongdoers, the Securities and Exchange Commission, with assistance from the Departments of Justice and Homeland Security:

(a) Assisted in and approved the retention of Roger Glenn, an ex-SEC trial attorney and drafter of Sarbanes-Oxley, to join CMKM Diamonds Inc. for the purpose of verifying claims value, increasing authorized shares of stock to 800,000,000,000, and supervising from the inside of the company;

(b) Encouraged the company to expand its promotional activities, assisted in the set up of the “racing activities” of the company, and underwrote a substantial portion of the cost of such activities;

(c) Consented to, facilitated, and supported the sale of certain company claims to several foreign corporations;

(d) Consented to, facilitated, and supported the conferences between Robert A. Maheu and his associates on the one hand, and the wrongdoing short sellers on the other, all for the purpose of settling the potential liability of said wrongdoers with consent of the U. S. Government and a representation of no criminal prosecution for such illegal sales;

(e) Consented to, facilitated, and supported the declaration of dividends payable by the company to each common shareholder of CMKM Diamonds, Inc.

(f) Consented to, facilitated, and supported the distribution of shares of CIM, a private company owned by Urban Casavant, as a stock dividend, including consent and approval of distribution of said shares to holders of more than 1.4 Trillion shares of CMKM Diamonds, Inc. common stock.”

11. “During the period from November, 2004 through April, 2005, CMKM Diamonds, Inc. negotiated the sale of some of its Saskatchewan, Canada, mineral claims to three Chinese domiciled corporations with the advice and consent, inter alia, of the Securities and Exchange Commission. Proceeds from the consummation of such sales were placed into a frozen trust for disbursal at a later time.”

12. “During the period from March, 2004 through August, 2006, on behalf of CMKM Diamonds, Inc. Robert A. Maheu, with assistance from others, negotiated a settlement with the illegitimate brokers, dealers, market makers, hedge funds, and other persons and entities that had engaged in naked short selling of CMKM Diamonds Inc. stock and cellar boxing the company. In exchange for a U. S. Government promise of no prosecution for such sales, the wrongdoers each promised to pay negotiated amounts to a frozen trust for disbursal at a later time.”

13. “Plaintiffs herein are informed and believe, and based thereon allege, that other moneys have been collected for the benefit of the shareholders of CMKM Diamonds, Inc. from the Depository Trust & Clearing Corporation, from the United States Government, and from the sale of additional assets including consent to enter into joint venture agreements with other companies holding mineral claims in Saskatchewan, Canada. Plaintiffs herein are further informed and believe, and based thereon allege, that said moneys, collected for the benefit of shareholders have also been placed in a trust or are otherwise now held in trust by the Depository Trust & Clearing Corporation and the United States Treasury.”

14. “Plaintiffs herein are informed and believe, and based thereon allege, that at all times mentioned, the Securities and Exchange Commission reserved unto itself the sole and absolute discretion to determine when moneys collected pursuant to the scheme set forth above would and could be released for distribution.”

15. “Demand for release of said moneys has been repeatedly presented to the Securities and Exchange Commission without result. Agents and employees of the Securities and Exchange Commission and the Department of Justice have represented repeatedly that the release of moneys for distribution was imminent, and/or would occur within several weeks, and/or would occur within less than a month. Each of said representations have been made knowing them to be false, and at the specific direction of the named Defendants. These actions of withholding distribution of said moneys, without compensation and without due process of law, amount to a taking of the property of the individual Plaintiffs and of all similarly situated.”

16. “At all times mentioned herein, the Defendants acted with deliberate indifference or reckless disregard for the Constitutional and other rights of all Plaintiffs, or with the intention and knowledge that they were violating Plaintiffs’ Constitutional or other rights or to cause them other injuries, losses and damage.”

17. “As a result of the Defendants’ misconduct, each of the named Plaintiffs and all of those similarly situated, have been denied their Constitutional rights, including, but not limited to, their Fifth Amendment right to be secure in their property, free from taking without just compensation and without due process of law, and have suffered injuries and property loss in excess of Three Trillion Dollars.”

18. The fact that the SEC participated in a sting operation using CMKX, then lied to CMKX shareholder representatives is only one issue in this case, the second is the modus operandi of the SEC and other regulators involved, including the U.S. and Canadian Governments, and in particular the RCMP and FBI. Given the fact the SEC and these authorities have conducted sting operations over the past decade regarding the counterfeiting of the stock market it needs to be explained how the same crime continued unabated for a decade by the same perpetrators. Evidence that will be presented by the Coalition will include congressional investigations and whistleblowers from the SEC that clearly prove the SEC has engaged in several well known cover-ups of crimes involving the counterfeiting of the stock market and are in fact “in bed with the industry” they regulate to the point where they make regulations with the same perpetrators which aid in facilitating the crime and its cover-up. They have ensured that retail victims and the companies they invested in would never recover from the fraud committed against them, and they made sure the perpetrators would not be held accountable, the whole time multiple Government Agencies and authorities watched and did nothing to prevent trillions of dollars in loses to the general public who were unwitting victims in this pandemic fraud.

19. The SEC has for decades colluded with Wall Street firms, the DTCC, the Federal Reserve, hedge funds, and others to defraud all shareholders. Between 1996 and 2001 the SEC and FBI were tracking money laundering through Canada, and knew crime families were trading naked short through Canada as Canada had no affirmative determination laws. In 1998 the SEC received over 3000 comment letters regarding the abuses of naked shorting. In 1999 the SEC participated in “operation uptick” which identified hundreds of companies that were victims of crime families who worked in concert with major wall street firms (none of the firms or those working in these wall street firms were indicted despite the fact that the crime family members they worked with were convicted of RICO crimes). In 2001 the NASD presented the SEC a proposal to modify RULE 3370 to eliminate the loophole associated with the naked shorting through Canada (the loophole was a clear violation in itself of RULE 17A). In 2001 EagleTech Communications filed RICO charges against many well known brokers on Wall Street and eventually won their criminal RICO case against crime family member who worked with many of those well known firms. They finally closed the loophole in April 2004 better than two years later and trillions of dollars in counterfeit shares later, but other loop holes created by the SEC in collusion with these same perpetrators has allowed the crime to continue to today. In October, 2009 Senator Ted Kaufman was seeking cosponsors for bill SB 605, which if passed would require the SEC to reinstate the uptick rule and enforce other regulations against abusive short selling as the SEC themselves refuse to follow their constitutional mandate.

20. EagleTech Communications will be used as an example of one of thousands of victim companies by the same group of perpetrators. They are one of the best examples of what has happened as they have already received convictions in their criminal RICO case regarding the crime family members who worked with Wall Street firms to laundry their proceeds from counterfeiting EagleTech stock. They are also a great example how the SEC treats the victims in these cases and the perpetrators, as the SEC instead of going after the perpetrators went after the victim and protected the Wall Street firms who worked with the convicted crime family members. Excerpts from Rod Young, CEO of EagleTech communications, “in an August of 2004 luncheon meeting with a potential witness in Eagletech’s civil case a member of the CIA showed up un-announced to me wanting details of the involvement of Jonathan Curshen and his Costa Rican Offshore asset protection company Red Sea Management in the demise of Eagletech. I was encouraged to write a criminal referral to the U.S. Secret Service who is charged with investigating counterfeiting of corporate securities under 18-USC-514. I authored 15 pages with 100 pages of evidence implicating the SEC and the DTCC as accessories to the crime. That referral was hand delivered to the Secret Service in Washington DC as a courtesy by the agent.” Despite having overwhelming evidence and winning their criminal RICO case against the crime family member who aided Wall Street brokers who counterfeit their stock, the SEC deregistered EagleTech and forced the victim to have to file RICO charges against the Wall Street firms themselves. The Wall Street firms identified in “operation uptick” that were involved in committing RICO crimes against hundreds of companies received nothing, while crime family members went to jail who laundered the proceeds from these crimes. Inexplicably the SEC ran a sting but aided the perpetrators, while ensuring the victims companies identified in that sting would never recover by creating an illegal clause with these same perpetrators. This illegal ‘grandfather clause” allowed these perpetrators to avoid having to cover their counterfeit shares they created, thus ensuring the depressed stock price would never recover due to the dilution created by the counterfeit shares. These victims companies would never recover due to the collusion between the SEC and these corrupt firms, and unsuspecting public lost trillions of dollars buying fake stock in publicly traded companies.

21. Rod Young, CEO of EagleTech Communications stated “Every shareholder of any Company in America who purchased shares and cannot get them delivered has a cause of action against the SEC as an agency of the U.S. Federal Government for violation of their 5th Amendment Constitutional property rights.” EagleTech is just one of thousands of victim companies systematically manipulated and cellar-boxed by the brokerages under the supervision of the SEC and were then delisted / put out of business by the SEC when financially unable to meet their reporting and other business obligations, eliminating any obligation of the brokerage firms to deliver real shares or value to those they sold counterfeit stock to.” And this talking of the SEC, “In my opinion this action against the Company is designed to conceal its own culpability in, using the SEC’s own words, “delivery failures greater than a company’s total public float.” De-registration of the Company’s shares stands to reward manipulators just as a bankruptcy would, since the manipulators would never have to purchase the stock to close out delivery failures still on the DTCC’s books. In my opinion the SEC’s decision to grandfather known criminal securities manipulation has violated the Constitutional 5th Amendment rights of Eagletech shareholders by an inverse taking of their property without due process and without compensation

[fung_derf]

Further CMKX Hodges lawsuit info...

CMKM/CMKX CASE DOCUMENTS: Case Number CV10-00031 JVS (MLGx):
This posting consists of four elements:

(1): In response to the Editor’s query dated 28th January 2010 to Mr A. Clifton Hodges, of Hodges and Associates, A Professional Law Corporation, Pasadena, CA, as to whether Mr Hodges would wish us to publicise the Letter of Service to David M. Becker, Esq., General Counsel, Securities and Exchange Commission, the Editor received this emailed response from Mr Hodges on the same date [received in London at 18:20]; the communication reads, in part:

'Good day sir:

You have my unqualified permission to use the Becker letter in any manner you think appropriate… I, and my clients and associates, very much appreciate all you do.

Thanks in advance and please do not hesitate to call upon us at any time. Should the need arise, please feel free to contact me at “odd” hours on my cell phone…'.

(2): Fax Transmittal of the Letter of Service for the attention of Michael C. Cottrell, B.A., M.S.

(3): Letter of Service from the Plaintiffs’ lawyers, Hodges and Associates, to David M. Becker, Esq., General Counsel, Securities and Exchange Commission, SEC Headquarters, Office of the General Counsel, 100 F Street, NE, Washington DC 20549 dated 27th January 2010.

(4): For your convenience, the full text of the complaint Case Number CV10-00031 JVS (MLGx) filed on behalf of CMKM/CMKX Plaintiffs on 8th January 2010 which we posted here on 9th January 2010 but which we are reproducing again here so that all the documents are in one place.

THE DOCUMENTS START HERE:

(2): Fax Transmittal of the Letter of Service for the attention of Michael C. Cottrell, B.A., M.S.:

HODGES and ASSOCIATES
A Professional Law Corporation

4 East Holly Street
Suite 202
Pasadena
CA 91103
Tel: [phone]
Fax: [phone]

FAX TRANSMITTAL COVER SHEET

DATE: January 27, 2010: CASE NAME: Anderson, et al., vs Cox, et al.
NUMBER OF PAGES: 3 [INCLUDING THIS COVER SHEET]

Please deliver to:
NAME: Michael Cottrell
FAX NUMBER: [phone]

From: A CLIFTON HODGES
Re:/Message:
Attached please find a copy of our January 27 2010 letter to David M. Becker, Esq., General Counsel for the SEC regarding the above-referenced matter

(3): Letter of Service from the Plaintiffs’ lawyers, Hodges and Associates, to David M. Becker, Esq., General Counsel, Securities and Exchange Commission, SEC Headquarters, Office of the General Counsel, 100 F Street, NE, Washington DC 20549, dated 27th January 2010:

HODGES and ASSOCIATES
A Professional Law Corporation

4 East Holly Street
Suite 202
Pasadena
CA 91103
Tel: [phone]
Fax: [phone]

A.Clifton Hodges
James S. Kostas
Donald W. Ricketts*
*Of Counsel

January 27, 2010
VIA FACSIMILE AND U.S. MAIL
[phone]

David M. Becker, Esq.
General Counsel
Securities and Exchange Commission
SEC Headquarters
Office of the General Counsel
100 F. Street, NE
Washington, DC 20549

Re: David Anderson, Lt. Col., et al., vs. Christopher Cox, et al.,
USDC Case No. SACV 10-0031-JVS (MLGx)

Dear Mr Becker:
As I am advised, you are aware that I represent seven of CMKM Diamonds, Inc.’s larger shareholders. I have previously provided a copy of our Bivens based class action lawsuit to Kathleen A. Cody, Esq., which was filed in the United States Central District Court of California on January 8, 2010. We are seeking release of funds that have been previously collected for the benefit of CMKM shareholders, or in the alternative for damages in the amount of 3.87 Trillion Dollars, according to proof. A confirmed copy of the USDC Case No. SACV 10-0031-JVS (MLGx) complaint and duly issued summons is attached.

Our complaint names as individual defendants each of the SEC Commissioners who have served since June 1, 2006, as follows: Christopher Cox, Mary L. Schapiro, Cynthia A. Glassman, Paul S. Atkins, Roel C. Campos, Annette L. Nazareth, Troy A. Pareded, Luis A. Aguilar, Elisse B. Walter, and Kathleen L. Casey. I am writing to inquire whether your office is in a position to accept service on behalf of each of the named commissioners; in the event that you are in fact going to represent each of the named commissioners in this litigation, and are willing to execute a waiver of service pursuant to FRCP Rule 4(d), I would appreciate early advice of this fact. If you will accept service on behalf of these named defendants and have them execute a waiver, I will prepare the same and submit them to your office forthwith.

In the event that you are unable to accept service for these defendants, I would appreciate your early advice to that effect. Please respond to this correspondence no later than February 5, 2010. Should I not hear from you by that date, I will serve the individually named defendants personally. Thank you in advance for your courtesy and cooperation.

Very truly yours,

HODGES AND ASSOCIATES
[Signed]
A.CLIFTON HODGES

ACH/gm
Enclosures

Cc: Kathleen A Cody, Esq.
Clients.

BCC: Michael Cottrell


(4): For your convenience, the full text of the complaint Case Number CV10-00031 JVS (MLGx) filed on behalf of CMKM/CMKX Plaintiffs on 8th January 2010 which we posted here on 9th January 2010, but which we are reproducing again here so that all the documents are in one place:


THE SUMMONS CIVIL COVER SHEET DISPLAYS:
'MONEY DEMANDED IN COMPLAINT: $3.87 TRILLION'


A. CLIFTON HODGES, State Bar No. 046803
HODGES AND ASSOCIATES

4 East Holly Street
Suite 202
Pasadena
CA 91103
Tel: [phone]
Fax: [phone]


Attorneys for Plaintiffs

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

DAVID ANDERSON, LT. COL.; NELSON L. REYNOLDS, LT. COL.; SHEILA MORRIS; PATRICK CLUNEY; ROBERT HOLLENEGG; ALLAN TREFFRY; and REECE HAMILTON, Individually and on behalf of all similarly situated,

Plaintiffs,

vs.:

CHRISTOPHER COX, an individual; MARY L. SCHAPIRO, an individual; CYNTHIA A. GLASSMAN,
an individual; PAUL S. ATKINS, an individual; ROEL C. CAMPOS, an individual; ANNETTE L. NAZARETH, an individual; TROY A. PAREDES, an individual; LUIS A. AGUILAR, an individual; ELISSE B. WALTER, an individual; KATHLEEN L. CASEY, an individual;

and DOES 1 through 10, inclusive,

Defendants. Case No.: CV10-00031-JVS (MLGx)

COMPLAINT FOR DECLARATORY JUDGMENT,
AND FOR DAMAGES FOR VIOLATION OF CIVIL RIGHTS

(JURY TRIAL DEMANDED)

COME NOW Plaintiffs DAVID ANDERSON, LT. COL.; NELSON L. REYNOLDS, LT. COL.; SHEILA MORRIS; PATRICK CLUNEY; ROBERT HOLLENEGG; ALLAN TREFFRY; and REECE HAMILTON, individually and on behalf of all others similarly situated, who, for causes of action herein allege:

INTRODUCTION:

1. This action for declaratory judgment and for damages for violations of the Plaintiffs’ civil rights under Bivens v. Six Unknown Agents of the F.B.I., 403 U.S. 388 (1971), against Commissioners of the Securities and Exchange Commission, arises out of actions and failures to act occurring over the period from January 1, 2006 to date by Defendants CHRISTOPHER COX, an individual; MARY L. SCHAPIRO, an individual; CYNTHIA A. GLASSMAN, an individual; PAUL S. ATKINS, an individual; ROEL C. CAMPOS, an individual; ANNETTE L. NAZARETH, an individual; TROY A. PAREDES, an individual; LUIS A. AGUILAR, an individual; ELISSE B. WALTER, an individual; KATHLEEN L. CASEY, an individual; and other government agents whose names are not now known to the Plaintiffs.

2. These Defendants, acting in the course and scope of their employment by the United States of America as duly authorized Commissioners of the Securities and Exchange Commission, a federal agency, through their acts and omissions knowingly, consciously, wrongly, without compensation and without due process of law have effected a taking of property from each of the named Plaintiffs and all who are similarly situated.

JURISDICTION AND VENUE:

3. This action for declaratory relief and damages is predicated on the provisions of the Constitution and Statutes of the United States, the legal and equitable jurisdiction of this Court, the principles of common law, and this Court’s concurrent and pendant jurisdiction.

4. This Court has jurisdiction over the Plaintiffs’ claims under Article III of the United States Constitution and the Fifth Amendment thereto. This Court has jurisdiction over Plaintiffs’ property rights under the foregoing citations and, in addition, pursuant to Title 28 U.S.C., Section 1331 and the case law precedent of Bivens v. Six Unknown Agents of the F.B.I., 403 U.S. 388 (1971).

5. Venue is proper in this Court under Title 28 U.S.C., Section 1391(e)(1)/(2). Defendants are all past or current Commissioners of the Securities and Exchange Commission and therefore agents of the United States Government, and a substantial part of the property, and the acts related to such property subject to Plaintiffs’ claims, occurred or was situated in this Central District of California at all times relevant.

THE PARTIES:

6. Plaintiff DAVID ANDERSON, LT. COL., U.S. Air Force pilot, resides in the State of Missouri, owns more than 280,000,000 shares of stock in CMKM Diamonds, Inc., and at all times relevant to the allegations set forth herein, was a citizen of the United States.

7. Plaintiff NELSON L. REYNOLDS, LT. COL., U.S. Air Force pilot, resides in the State of Texas, owns more than 15,000,000 shares of stock in CMKM Diamonds, Inc., and at all times relevant to the allegations set forth herein, was a citizen of the United States.

8. Plaintiff SHEILA MORRIS, a company owner/CEO resides in the State of North Carolina, owns
more than 400,000,000 shares of stock in CMKM Diamonds, Inc., and at all times relevant to the allegations set forth herein, was a citizen of the United States.

9. Plaintiff PATRICK CLUNEY, a retired professional athlete resides in the State of Florida, owns more than 680,000,000 shares of stock in CMKM Diamonds, Inc., and at all times relevant to the allegations set forth herein, was a citizen of the United States.

10. Plaintiff ROBERT HOLLENEGG resides in the State of North Carolina, owns more than 85,000,000 shares of stock in CMKM Diamonds, Inc., and at all times relevant to the allegations set forth herein, was a citizen of the United States.

11. Plaintiff ALLAN TREFFRY, a licensed State of California Attorney, resides in the County of Los Angeles, State of California, owns more than One Billion shares of stock in CMKM Diamonds, Inc., and at all times relevant to the allegations set forth herein, was a citizen of the United States.

12. Plaintiff REECE HAMILTON, a business owner/partner resides in the County of Los Angeles, State of California, owns more than One Billion shares of stock in CMKM Diamonds, Inc., and at all times relevant to the allegations set forth herein, was a citizen of the United States.

13. Defendants CHRISTOPHER COX, Chairman 2005-2009, MARY L. SCHAPIRO, Chairman 2009-2010, CYNTHIA A. GLASSMAN Commissioner 2002-2006, PAUL S. ATKINS, Commissioner 2002-2008, ROEL C. CAMPOS, Commissioner 2002-2007, ANNETTE L. NAZARETH, Commissioner 2005-2008, TROY A. PAREDES, Commissioner 2008-2010, LUIS A. AGUILAR Commissioner 2008-2010, ELISSE B. WALTER Commissioner 2008-2010 and KATHLEEN L. CASEY, Commissioner 2008-2010: are and, at all referenced times mentioned herein were, acting as individuals and as Commissioners of the Securities and Exchange Commission, an agency of the UNITED STATES OF AMERICA, and acting within the course and scope of their employment. These Defendants are the real parties in interest in the claims set forth herein.

14. Other employees and servants of the Securities and Exchange Commission are also liable for damages under the causes of action set out in this Complaint. However, the names of these employees and servants are not now known to Plaintiffs, who thereby names them herein as DOES 1 through 10. When the names of these employees and servants become known, Plaintiffs reserve the right to amend this Complaint to add the names of these DOE Defendants.

FACTUAL CONTENTIONS APPLICABLE TO ALL CAUSES OF ACTION:

15. In November and December, 2002, CYBER MARK INTERNATIONAL INC., a public company domiciled in Nevada, reverse-merged with Casavant Mineral Claims, which then held mineral claims to more than 600,000 acres within Saskatchewan, Canada, increased authorized capital from 500,000,000 to 10,000,000,000 common shares, cancelled all preferred shares, and changed its name to CASAVANT MINING KIMBERLITE INTERNATIONAL, INC. (CMKI); as of February 3, 2003, 7,241,653,404 shares were issued and outstanding.

16. During the succeeding months CMKI declared a 2 for 1 stock split and filed with the Securities and Exchange Commission: Form 15 exemption claim, July, 2003; Certificate of Amendment to Articles of Incorporation changing its name to CMKM DIAMONDS, INC. (CMKM), February 5, 2004; Certificate of Amendment to Articles of Incorporation raising its authorized capital to 500,000,000,000 common shares @ $0.001 par value, March 1, 2004; Certificate of Amendment to Articles of Incorporation correcting the par value of common shares as of December 26, 2002 to $0.0001 par value, July 13, 2004; Certificate of Amendment to Articles of Incorporation raising its authorized capital to 800,000,000,000 common shares @ $0.0001 par value, July 13, 2004.

17. During the summer and fall of 2004: New York Attorney Roger Glenn was retained by the company; the number of acres upon which CMKM held claims increased to over 1.2 Million acres; claims development activity was pursued by the company; and a shareholders appreciation party was planned to be celebrated in Las Vegas, Nevada to thank the shareholders, to give them an opportunity to meet company personnel, and to announce an agreed upon merger with another public company, U.S. CANADIAN MINERALS INC. On the eve of the party celebration, the Securities and Exchange Commission placed an order on CMKM preventing any public disclosure of anticipated mergers or other development information.

18. In early 2005, CMKM announced the addition of Robert A. Maheu to the Board of Directors who shortly thereafter became the co-chairman of the Board; CMKM announced a new “corporate strategy plan to dramatically and comprehensively transform” the company for generation of consistent, long-term growth and profitability for the shareholders; CMKM filed an amended Form 15 on February 17, 2005 reinstating the company to a public reporting status; and on March 3, 2005 was notified by the Securities and Exchange Commission of a temporary suspension of trading of the company’s stock (Pink Sheets-CMKX) based upon, inter alia, concerns over the “adequacy” of publicly available information.

19. On March 16, 2005 the Securities and Exchange Commission instituted a public administrative proceeding pursuant to Section 12 (j) of the Securities Exchange Act of 1934 against CMKM to determine whether the company was required to file periodic reports under Section 12(g) and whether CMKM failed to comply with Section 13(a), and rules there-under, by failing to so file. CMKM responded on April 11, 2005 admitting that CMKM had a duty to file public reports and alleging various grounds of mistake, malpractice and other affirmative defenses to the factual allegations.

20. From March 17, 2005 through April 29, 2005 CMKM traded publicly in the US under the trading symbol “CMKX,” a total of 551,756,751,833 shares, an average share volume of more than 17 billion shares per day, reaching a maximum on April 21, 2005 of 94,654,588,201 shares. These figures do not include foreign trades nor trades made on an ex-clearing basis such as those disclosed by Jefferies & Company , Inc. on May 6, 2005: between March 25, 2004 and September 21, 2004 Jefferies traded 111,780,681,204 shares of CMKX stock on an ex-clearing basis.

21. On May 10, 2005 the Section 12 (j) administrative proceeding was conducted in a United States Central District of California courtroom; the Administrative Law Judge, Honorable Brenda P. Murray entered her decision on July 12, 2005 finding the facts to be as alleged by the Securities and Exchange Commission. CMKM then filed a Petition for Review which was granted, and a briefing schedule set.

22. On October 20, 2005: Robert A. Maheu resigned as a member and co-chairman of the CMKM Board of Directors; Urban Casavant agreed to remain as the sole officer and Director of CMKM until the affairs of CMKM were wound up to ensure all shares and other assets of CMKM were properly distributed to its stockholders; CMKM entered into an agreement with Entourage Mining Ltd. pursuant to which CMKM assigned its 50% interest in United Carina Resources Corp. to Entourage for 15,000,000 shares of stock, sold its 36% interest in Nevada Minerals, Inc. claims to Entourage for 5,000,000 shares of stock, and made a joint agreement with 101047025 Saskatchewan Inc. and Entourage whereby certain claims were transferred and CMKM became entitled to receive 30,000,000 shares of stock; CMKM’s other agreements with United Carina Resources Corp. and Nevada Minerals Inc. were terminated.

23. On October 21, 2005 CMKM approved formation of a Task Force consisting of Robert A.
Maheu, Donald J. Stoecklein and Bill Frizzell for the purpose of assisting CMKM and Mr. Maheu, as “designated Trustee, to conduct an orderly and verifiable pro rata liquidating distribution of any Entourage Mining Ltd. shares…and any other available assets of CMKM;” the SEC Petition for Review was withdrawn by CMKM on October 21, 2005 and a Securities and Exchange Commission Order de-registering CMKM subsequently was formally entered on October 28, 2005. CMKM had 703,518,875,000 shares of common stock issued and outstanding on that date.

24. On November 4, 2005 CMKM established a web site (CMKMTaskForce.com) for the purpose, inter alia, of advising all shareholders to request physical share certificates evidencing their ownership interest in CMKM as one means of establishing that they were bona fide shareholders of the company. The company intended at that time to wind up its affairs and distribute the 50 million shares of Entourage Mining Ltd. stock and any other assets, including previously unpaid dividends, to the bona fide shareholders. The web site set forth procedures to be followed and established a means of registering all bona fide shareholder certificates prior to December 31, 2005; certificates evidencing 43,309,298,585, shares had been registered at that time.

25. A frequently asked question (FAQ) page was added to the web site on the evening of November 4, 2005 and in response to a question about the degree of naked shorting of CMKM stock, the Task Force indicated that “Credible information indicates the number of naked short shares is potentially as high as 2 Trillion shares”.

26. The Task Force issued a press release on January 19, 2006 discussing a reduction in total shares of Entourage Mining Ltd. stock to be distributed to CMKM shareholders from 50 Million shares to 45 Million shares as a result of a reduction in mining claims involved.

The Task Force also discussed issues involving difficulties obtaining physical share certificates being experienced by shareholders; accordingly the deadline date for registration of shares was extended to March 15, 2006.

The Task Force was provided a new “cert list” by First Global Stock Transfer showing certs issued “and active” on January 13, 2006; ADP Services also provided information to the Task Force. This data reflected a sample of 25,021 certificates representing 350,000,000,000 plus shares of stock and a total of more than 67,000 additional certificates to be counted.

27. On March 16, 2006 the Task Force issued a public release that “…we received a visit in our office [in Tyler, Texas] by an E-Trade rep today. This rep personally hand delivered copies of approximately 4000” certificates. Further information regarding on-going discussions with the DTCC and other brokerage houses was also provided.

28. The Task Force provided additional information on March 20, 2006, extending the time for registration of certificates to May 15, 2006, advising the shareholders that Urban Casavant and his immediate family would not participate in the share distribution, and advising that a printed notice to stock holders would be published in at least one nationally circulated United States newspaper.

29. On May 25, 2006 the Task Force received a second batch of 1,200 share certificates from AmeriTrade, having received some 1,000 share certificates a week earlier. AmeriTrade’s cover letter indicated that several hundred more certificates would be delivered within “the next few days.” The deadline for registering certificates of May 15, 2006 had not been extended, although the Task Force continued to advise shareholders that they should obtain their certificates and that the Task Force would honor any bona fide shareholder at the time of asset distribution. By late Fall, 2006, the Task Force had received and counted copies of certificates from more than 39,000 shareholders, evidencing more than 635 Billion shares.

30. Kevin West was hired pursuant to a written agreement by CMKM during the summer of 2006
to assist in winding up the affairs of the company and, more specifically, coordinating the share certificate pull. After serving nearly a year as Interim CEO, Kevin West was appointed Chairman of the Board on March 29, 2007 after which Urban Casavant stepped down as sole director, president, secretary and treasurer of CMKM Diamonds, Inc. Mr. West soon thereafter appointed Bill Frizzell as CMKM General Counsel and provided instructions for the filing of a number of lawsuits to attempt to recover moneys and other assets which had been wrongfully taken from the company.

31. During the period of June 1, 2004 through October 28, 2005 a total of 2.25 Trillion “phantom” shares of CMKM Diamonds Inc, was sold into the public market through legitimate brokers, illegitimate brokers and dealers, market makers, hedge funds, ex-clearing transactions and private transactions. The sales of the majority of such shares were at all times known to the Securities and Exchange Commission, including Defendants herein.

32. At some date prior to June 1, 2004 the Securities and Exchange Commission in concert with the Department of Justice of the United States, together combined with Robert A. Maheu and others to utilize CMKM Diamonds, Inc. for the purpose of trapping a number of widely disbursed entities and persons who were believed to be engaged in naked short selling of CMKM Diamonds Inc. stock and cellar boxing the company.

The Securities and Exchange Commission and the Department of Justice, with assistance from the Department of Homeland Security, believed and developed evidence that said short sellers were utilizing their activities to illegally launder moneys, wrongfully export moneys, avoid payment of taxes, and to support foreign terrorist operations. To fulfill the plan to criminally trap such wrongdoers, the Securities and Exchange Commission, with assistance from the Departments of Justice and Homeland Security:

(a) Assisted in and approved the retention of Roger Glenn, an ex-SEC trial attorney and drafter of Sarbanes-Oxley, to join CMKM Diamonds Inc. for the purpose of verifying claims value, increasing authorized shares of stock to 800,000,000,000, and supervising from the inside of the company;

(b) Encouraged the company to expand its promotional activities, assisted in the set up of the “racing activities” of the company, and underwrote a substantial portion of the cost of such activities;

(c) Consented to, facilitated, and supported the sale of certain company claims to several foreign corporations;

(d) Consented to, facilitated, and supported the conferences between Robert A. Maheu and his associates on the one hand, and the wrongdoing short sellers on the other, all for the purpose of settling the potential liability of said wrongdoers with consent of the U. S. Government and a representation of no criminal prosecution for such illegal sales;

(e) Consented to, facilitated, and supported the declaration of dividends payable by the company to each common shareholder of CMKM Diamonds, Inc.

(f) Consented to, facilitated, and supported the distribution of shares of CIM, a private company owned by Urban Casavant, as a stock dividend, including consent and approval of distribution of said shares to holders of more than 1.4 Trillion shares of CMKM Diamonds, Inc. common stock.

33. During the period from November, 2004 through April, 2005, CMKM Diamonds, Inc. negotiated the sale of some of its Saskatchewan, Canada, mineral claims to three Chinese domiciled corporations with the advice and consent, inter alia, of the Securities and Exchange Commission. Proceeds from the consummation of such sales were placed into a frozen trust for disbursal at a later time.

34. During the period from March, 2004 through August, 2006, on behalf of CMKM Diamonds, Inc. Robert A. Maheu, with assistance from others, negotiated a settlement with the illegitimate brokers, dealers, market makers, hedge funds, and other persons and entities that had engaged in naked short selling of CMKM Diamonds Inc. stock and cellar boxing the company. In exchange for a U. S. Government promise of no prosecution for such sales, the wrongdoers each promised to pay negotiated amounts to a frozen trust for disbursal at a later time.

35. Plaintiffs herein are informed and believe, and based thereon allege, that other moneys have been collected for the benefit of the shareholders of CMKM Diamonds, Inc. from the Depository Trust & Clearing Corporation, from the United States Government, and from the sale of additional assets including consent to enter into joint venture agreements with other companies holding mineral claims in Saskatchewan, Canada. Plaintiffs herein are further informed and believe, and based thereon allege, that said moneys, collected for the benefit of shareholders have also been placed in a trust or are otherwise now held in trust by the Depository Trust & Clearing Corporation and the United States Treasury.

36. Plaintiffs herein are informed and believe, and based thereon allege, that at all times mentioned, the Securities and Exchange Commission reserved unto itself the sole and absolute discretion to determine when moneys collected pursuant to the scheme set forth above would and could be released for distribution.

37. Demand for release of said moneys has been repeatedly presented to the Securities and Exchange Commission without result. Agents and employees of the Securities and Exchange Commission and the Department of Justice have represented repeatedly that the release of moneys for distribution was imminent, and/or would occur within several weeks, and/or would occur within less than a month. Each of said representations have been made knowing them
to be false, and at the specific direction of the named Defendants. These actions of withholding distribution of said moneys, without compensation and without due process of law, amount to a taking of the property of the individual Plaintiffs and of all similarly situated.

38. At all times mentioned herein, the Defendants acted with deliberate indifference or reckless disregard for the Constitutional and other rights of all Plaintiffs, or with the intention and knowledge that they were violating Plaintiffs’ Constitutional or other rights or to cause them other injuries, losses and damage.

39. As a result of the Defendants’ misconduct, each of the named Plaintiffs and all of those similarly situated, have been denied their Constitutional rights, including, but not limited to, their Fifth Amendment right to be secure in their property, free from taking without just compensation and without due process of law, and have suffered injuries and property loss in excess of Three Trillion Dollars.

CLASS ACTION ALLEGATIONS:

40. Plaintiffs bring this action individually, and on behalf of all others similarly situated, and in the public interest.

41. Plaintiffs bring this action on behalf of a class of persons who were and are bona fide shareholders in CMKM Diamonds, Inc., a public company directly supervised by the Securities and Exchange Commission.

42. Plaintiffs are members of said class, have a claim typical of the claims of all members of said class, and will fairly and adequately represent the interests of the members of said class.

43. The members of said class are so numerous that joinder of all members is impracticable.

44. All of the class members are wholly identifiable from documents known to be in the possession of Defendants and of the Securities and Exchange Commission.

45. The claims of the members of said class present common issues of fact and law which predominate over any questions affecting only individual members of the class.

46. The defenses available to defendants to the claims of the members of the class present common issues of fact and law which predominate over any questions affecting only individual members of the class.

47. The prosecution of separate actions by the individual members of the class would create a risk of inconsistent or varying adjudications which would establish incompatible standards of conduct for defendants.

48. Adjudications with respect to individual members of said class would, as a practical matter be dispositive of the interest of other members not parties to the individual adjudications or would substantially impair or impede the right and/or ability to protect their interest.

49. Defendants have acted or refused to act on grounds generally applicable to said class thereby making appropriate final injunctive relief with respect to the class as a whole.

50. Unless ordered by this court, Defendants will continue their illegal and wrongful conduct, and repeated actions by individual class members will be required to obtain relief; and thereby the remedies available at law are inadequate.

51. For all of the above reasons, a class action is superior to other available methods for the fair and efficient adjudication of the claims alleged herein.

FIRST CAUSE OF ACTION
(FOR DECLARATORY RELIEF AGAINST ALL DEFENDANTS):

52. Plaintiffs incorporate as though fully set forth herein, all of the allegations contained in Paragraphs 1 through 39 above.

53. Plaintiffs allege that an actual controversy exists in this jurisdiction, in that it is the Plaintiffs’ contention that:

(a) The Defendants are, or in the past were, Commissioners of the SECURITIES AND EXCHANGE COMMISSION, an agency of the UNITED STATES OF AMERICA. At all relevant times herein, said Defendants were acting as individuals and in their official capacity as agents of the SECURITIES AND EXCHANGE COMMISSION.

(b) On and after January 1, 2006, the Defendants, acting alone and acting in concert with each other, and acting without just cause, did consciously, knowingly, intentionally and wrongfully cause certain acts and omissions to proceed in such manner as to hinder, delay, and ultimately prevent the distribution of moneys held for the benefit of Plaintiffs, and all similarly situated, said moneys being payable to each said person on a per share basis.

(c) The Defendants, and each of them, acted in their individual and their official capacities with deliberate or reckless disregard for the Constitutional and other rights of Plaintiffs and all similarly situated or with malicious intent and with the knowledge that their acts and omissions violated and denied the Constitutional and other rights of Plaintiffs and all similarly situated, or that their acts would cause said Plaintiffs and all similarly situated other injuries.

(d) The Defendants, and each of them, did unlawfully and wrongfully cause certain acts and omissions to proceed in such manner as to hinder, delay, and ultimately prevent the distribution of moneys held for the benefit of Plaintiffs and all similarly situated, even though the Defendants knew that said persons had a vested interest and Constitutional right to receive said moneys in a timely, unfettered and unconstrained manner.

(e) The Defendants, and each of them, knew that Plaintiffs and all similarly situated had a vested interest and Constitutional right to receive said moneys in a timely, unfettered and unconstrained manner when they committed the acts and omissions set forth above, causing each said person to be deprived of property without just compensation and without due process of law.

54. The Defendants, and each of them, contend to the contrary. Therefore, it is necessary and proper for this Court at this time to determine and declare the validity of the contentions of the parties as set forth above.

SECOND CAUSE OF ACTION
(FOR VIOLATION OF THE PLAINTIFFS’ CONSTITUTIONAL RIGHTS AGAINST DEFENDANTS COX, SHAPIRO, GLASSMAN, ATKINS, CAMPOS, NAZARETH, PAREDES,AGUILAR, WALTER, and CASEY):

55. Plaintiffs incorporate as though fully set forth herein all of the allegations contained in Paragraphs 1 through 51, above.

56. Defendants, by committing the above-mentioned acts and omissions, violated and denied the Plaintiffs’ Constitutional rights, and those of all similarly situated, including, but not limited to, their Fifth Amendment right to be secure in their property, free from taking without just compensation and without due process of law.

57. Defendants, and each of them, acted and failed to act with the intent to deny the Constitutional rights of Plaintiffs and of all those similarly situated, or with the intentional or callous disregard or deliberate indifference to those rights. The above described acts of the Defendants, all charged with securities law enforcement as Commissioners of the Securities and Exchange Commission, in violation of the Constitutional rights of Plaintiffs and of all those similarly situated, were not intended to be exempt from liability.

58. As a result of the Defendants’ acts, Plaintiffs and all those similarly situated have suffered injuries and property loss in excess of 3.87 Trillion Dollars in an exact amount to be determined at the time of Trial. Because Defendants’ actions were intentional or done with callous disregard or deliberate indifference to the Constitutional and other rights of all Plaintiffs, this Court should award punitive damages against each individually named Defendant.

WHEREFORE, Plaintiffs seek judgment as follows:

1. For a declaratory judgment, pursuant to Title 28 U.S.C., Sections 2201 and 2202, which determines and declares the validity of the contentions of the parties set forth in Paragraphs 52 to 54, above;

2. For a judgment for compensatory, general and special damages in the amounts prayed for in the Second Cause of action set forth above;

3. For a judgment for punitive damages in an amount sufficient to punish and to make examples of these Defendants, and to deter these Defendants and others from engaging in similar conduct;

4. For an award of reasonable attorney’s fees, expenses and costs of suit incurred herein; and:

5. For such other and further relief as this Court deems just and proper.

Dated: January 10, 2010.

HODGES AND ASSOCIATE

By: [Signed]

A. CLIFTON HODGES
Attorneys for Plaintiffs

DEMAND FOR JURY TRIAL


• EDITOR'S NOTE:
This document should be read in conjunction with our reports dated 7th and 9th January 2010.
These can be accessed instantly by pressing ARCHIVE.


LIST OF U.S. STATUTES, SECURITIES REGULATIONS AND LEGAL PRINCIPLES OF WHICH THE CRIMINALISTS, ASSOCIATES AND ALL THE MAIN FINANCIAL INSTITUTIONS REMAIN IN BREACH:

LEGAL TUTORIAL: The Steps of Common Fraud:

Step 1: Fraud in the Inducement: “… is intended to and which does cause one to execute an instrument, or make an agreement… The misrepresentation involved does not mislead one as the paper he signs but rather misleads as to the true facts of a situation, and the false impression it causes is a basis of a decision to sign or render a judgment”. Source: Steven H. Gifis, ‘Law Dictionary’, 5th Edition, Happauge: Barron’s Educational Series, Inc., 2003, s.v.: ‘Fraud’.

Step 2: Fraud in Fact by Deceit (Obfuscation and Denial) and Theft:

• “ACTUAL FRAUD. Deceit. Concealing something or making a false representation with an evil intent [scanter] when it causes injury to another…”. Source: Steven H. Gifis, ‘Law Dictionary’, 5th Edition, Happauge: Barron’s Educational Series, Inc., 2003, s.v.: ‘Fraud’.

• “THE TORT OF FRAUDULENT DECEIT… The elements of actionable deceit are: A false representation of a material fact made with knowledge of its falsity, or recklessly, or without reasonable grounds for believing its truth, and with intent to induce reliance thereon, on which plaintiff justifiably relies on his injury…”. Source: Steven H. Gifis, ‘Law Dictionary’, 5th Edition, Happauge: Barron’s Educational Series, Inc., 2003, s.v.: ‘Deceit’.

Step 3: Theft by Deception and Fraudulent Conveyance:

THEFT BY DECEPTION:

• “FRAUDULENT CONCEALMENT… The hiding or suppression of a material fact or circumstance which the party is legally or morally bound to disclose…”.

• “The test of whether failure to disclose material facts constitutes fraud is the existence of a duty, legal or equitable, arising from the relation of the parties: failure to disclose a material fact with intent to mislead or defraud under such circumstances being equivalent to an actual ‘fraudulent concealment’…”.

• To suspend running of limitations, it means the employment of artifice, planned to prevent inquiry or escape investigation and mislead or hinder acquirement of information disclosing a right of action, and acts relied on must be of an affirmative character and fraudulent…”.

Source: Black, Henry Campbell, M.A., 'Black’s Law Dictionary’, Revised 4th Edition, St Paul: West Publishing Company, 1968, s.v. ‘Fraudulent Concealment’.

FRAUDULENT CONVEYANCE:

• “FRAUDULENT CONVEYANCE… A conveyance or transfer of property, the object of which is to defraud a creditor, or hinder or delay him, or to put such property beyond his reach…”.

• “Conveyance made with intent to avoid some duty or debt due by or incumbent or person (entity) making transfer…”.

Source: Black, Henry Campbell, M.A., ‘Black’s Law Dictionary', Revised 4th Edition, St Paul: West Publishing Company, 1968, s.v. ‘Fraudulent Conveyance’.

U.S. SECURITIES REGULATIONS OF WHICH INSTITUTIONS
HAVE BEEN SHOWN TO BE IN BREACH [SEE REPORTS]:

• NASD Rule 3120, et al.
• NASD Rule 2330, et al
• NASD Conduct Rules 2110 and 3040
• NASD Conduct Rules 2110 and IM-2110-1
• NASD Conduct Rules 2110 and SEC Rule 15c3-1
• NASD Conduct Rules 2110 and 3110
• SEC Rules 17a-3 and 17a-4
• NASD Conduct Rules 2110 and Procedural Rule 8210
• NASD Conduct Rules 2110 and 2330 and IM-2330
• NASD Conduct Rules 2110 and IM-2110-5
• NASD Systems and Programme Rules 6950 through 6957
• 97-13 Bank Secrecy Act, Recordkeeping Rule for funds transfers and transmittals of funds, et al.

U.S. LAWS ROUTINELY BREACHED BY THE CRIMINAL OPERATIVES AND INSTITUTIONS:

• Annunzio-Wylie Anti-Money Laundering Act
• Anti-Drug Abuse Act
• Applicable international money laundering restrictions
• Bank Secrecy Act
• Crimes, General Provisions, Accessory After the Fact [Title 18, USC]
• Currency and Foreign Transactions Reporting Act
• Economic Espionage Act
• Hobbs Act
• Imparting or Conveying False Information [Title 18, USC]
• Maloney Act
• Misprision of Felony [Title 18, USC] (1)
• Money-Laundering Control Act
• Money-Laundering Suppression Act
• Organized Crime Control Act of 1970
• Perpetration of repeated egregious felonies by State and Federal public employees and their Departments and agencies, which are co-responsible with the said employees for ONGOING illegal and criminal actions, to sustain fraudulent operations and crimes in order to cover up criminalist activities and High Crimes and Misdemeanours by present and former holders of high office under the United States
• Provisions pertaining to private business transactions being protected under both private and criminal penalties [H.R. 3723]
• Provisions prohibiting the bribing of foreign officials [F.I.S.A.]
• Racketeer Influenced and Corrupt Organizations Act [R.I.C.O.]
• Securities Act 1933
• Securities Act 1934
• Terrorism Prevention Act
• Treason legislation, especially in time of war.

• BEWARE OF MALICIOUS IMITATIONS: It has come to our notice that certain websites have been in the habit of copying reports from this site, attributing the reports to the Editor of this service, but at the same time AMENDING AND INSERTING TEXT NOT WRITTEN BY THE EDITOR.

• This is a very old, malevolent US counterintelligence DIRTY TRICK.

Therefore, you should be advised that the GENUINE ORIGINAL REPORT is, by obvious definition, accessible ONLY FROM THIS WEBSITE. If you come across an article elsewhere that is attributed to the Editor of this service, you should refer to the ORIGINAL ARTICLE HERE and you should bear in mind that the illegally duplicated article may contain text that was NOT written by the Editor of this service, but which was inserted for malicious purposes by counterintelligence.

Likewise, although we haven't yet had time to elaborate this issue, we have taken drastic steps around the world to close off the malicious piracy of our books. One technique used by several disreputable sites (in the United States, the Netherlands and Switzerland) is to copy our title(s) and (a) to display an image of the front cover WITHOUT THE ISBN DATA at the top of the cover; and (b) to DELETE THE COPYRIGHT PAGE. In so doing, the criminal pirates proclaimed that they knew perfectly well that they were/are engaged in theft and can be prosecuted for stealing copyright.

• Please be advised that the Editor of International Currency Review and associated intelligence services cannot enter into email correspondence related to this or to any of the earlier reports.

We are a private intelligence publishing house and have no connections to any outside parties including intelligence agencies. The word ‘intelligence’ on this website and in all our marketing material is used for marketing/sales purposes only and has no other connotations whatsoever: see ‘About Us’ on the red panels under the Notes on the Editor, Christopher Story FRSA, who has been solely and exclusively engaged as an investigative journalist, Editor, Author and private financial and current affairs Publisher since 1963 and is not and never has been an agent for a foreign power, suggestions to the contrary being actionable for libel in the English Court.

[fung_derf]

Lawsuit filed by Al Hodges...

UNITED STATES DISTRICT COURT, CENTRAL DISTRICT OF CALIFORNIA (Southern Division - Santa Ana)
CIVIL DOCKET FOR CASE #: 8:10-cv-00031-JVS-MLG


David Anderson et al v. Christopher Cox et al
Assigned to: Judge James V. Selna
Referred to: Magistrate Judge Marc L. Goldman
Cause: 28:1331 Fed. Question

Date Filed: 01/08/2010
Jury Demand: Plaintiff
Nature of Suit: 440 Civil Rights: Other
Jurisdiction: Federal Question




Plaintiff


David Anderson
Lt. Col
represented by
A Clifton Hodges
Hodges and Associates
4 East Holly Street Suite 202
Pasadena , CA 91103-3900
626-564-9797
Fax: [phone]
Email: [e-mail]
LEAD ATTORNEY
ATTORNEY TO BE NOTICED





Plaintiff



Nelson L Reynolds
Lt. Col
represented by
A Clifton Hodges
(See above for address)
LEAD ATTORNEY
ATTORNEY TO BE NOTICED





Plaintiff



Sheila Morris
represented by
A Clifton Hodges
(See above for address)
LEAD ATTORNEY
ATTORNEY TO BE NOTICED





Plaintiff



Patrick Cluney
represented by
A Clifton Hodges
(See above for address)
LEAD ATTORNEY
ATTORNEY TO BE NOTICED





Plaintiff



Robert Hollenegg
represented by
A Clifton Hodges
(See above for address)
LEAD ATTORNEY
ATTORNEY TO BE NOTICED





Plaintiff



Allan Treffry
represented by
A Clifton Hodges
(See above for address)
LEAD ATTORNEY
ATTORNEY TO BE NOTICED





Plaintiff



Reece Hamilton
individually and on behalf of all similarly situated
represented by
A Clifton Hodges
(See above for address)
LEAD ATTORNEY
ATTORNEY TO BE NOTICED






V.



Defendant



Christopher Cox
an individual







Defendant



Mary L Schapiro
an individual







Defendant



Cynthia A Glassman
an individual







Defendant



Paul S Atkins
an individual







Defendant



Roel C Campos
an individual







Defendant



Annette L Nazareth
an individual







Defendant



Troy A Paredes
an individual







Defendant



Luis A Aguilar
an individual







Defendant



Elisse B Walter
an individual







Defendant



Kathleen L Casey
an individual







Defendant



Does
1 through 10, inclusive










Date Filed
#
Docket Text

01/08/2010
1
COMPLAINT against defendants Christopher Cox, Mary L Schapiro, Cynthia A Glassman, Paul S Atkins, Roel C Campos, Annette L Nazareth, Troy A Paredes, Luis A Aguilar, Elisse B Walter, Kathleen L Casey, Does.(Filing fee $ 350 paid) jury demand., filed by plaintiffs Allan Treffry, Reece Hamilton, David Anderson, Nelson L Reynolds, Sheila Morris, Patrick Cluney, Robert Hollenegg.(twdb) (Entered: 01/12/2010)

01/08/2010
2
CERTIFICATION AND NOTICE of Interested Parties filed by plaintiffs Allan Treffry, Reece Hamilton, David Anderson, Nelson L Reynolds, Sheila Morris, Patrick Cluney, Robert Hollenegg, (twdb) (Entered: 01/12/2010)

01/08/2010

21 DAY Summons Issued re Complaint - (Discovery), 1 as to defendants Christopher Cox, Mary L Schapiro, Cynthia A Glassman, Paul S Atkins, Roel C Campos, Annette L Nazareth, Troy A Paredes, Luis A Aguilar, Elisse B Walter, Kathleen L Casey, Does. (twdb) (Entered: 01/12/2010)

[fung_derf]

All Pro Auto Mall owner indicted

12/30/2009 3:33 AM

By Linda Metz, Staff writer
[e-mail]

A Canonsburg auto dealer was indicted Tuesday for allegedly using another person's personal information to obtain financing for nine luxury cars.

Vincent A. LoCastro, 46, of McMurray, faces identity theft charges for allegedly using the name, date of birth and Social Security number of "a person known to the grand jury" to acquire loans that resulted in four banks losing more than $330,000.

According to federal prosecutors, LoCastro obtained the loans while doing business as owner of All Pro Auto Mall, 116 1/2 S. Central Ave.

Further details on the alleged crime were not available. However, Assistant U.S. Attorney Nelson P. Cohen, who presented the case to the grand jury, said the law provides for a maximum total sentence per count of 15 years in prison, a fine of $250,000 or both. LoCastro testified before the grand jury in March 2008.

State police and U.S. postal inspectors conducted the investigation leading to the indictment.

Early in 2008, LoCastro agreed to comply with a state consumer protection law regarding some cars that were improperly sold through the dealership. State Attorney General Tom Corbett had filed claims that LoCastro violated fair trade practices, consumer protection laws and Pennsylvania auto regulations.

The filing said his company misrepresented the condition of advertised vehicles and collected deposits for online auctions but failed to return them when purchasers did not complete a transaction. After LoCastro & Associates was removed as a qualified seller on eBay Motors, the company did not disclose its interest in vehicles offered for sale by using the name of an unrelated Pennsylvania dealership.

LoCastro signed a voluntary compliance agreement and paid $11,607 in civil penalties, the cost of investigation and filing fees and has returned deposits or security collected from consumers who canceled or breached sales contracts.

LoCastro remains free on a recongizance bond while he awaits trial on hundreds of charges filed by state police claiming fraudulent business practices at the dealership in 2007 and 2008.

LoCastro was charged in January. A trial date is scheduled for next month before Washington County Judge Janet Moschetta Bell.

In 2002, the Securities and Exchange Commission accused LoCastro and another executive of Pinnacle Business Management Inc., based in Clearwater, Fla., of misleading investors into buying Pinnacle's penny stock. LoCastro agreed to a settlement in which he was sanctioned but admitted no wrongdoing.

In recent years, All Pro Auto Mall has sustained more than $1 million in damages from three fires that investigators determined to be arson.

http://www.observer-reporter.com/OR/Story/12-30-2009-LoCastro-indictment


McMurray man indicted on identity theft charges
Wednesday, December 30, 2009
Pittsburgh Post-Gazette

A federal grand jury yesterday indicted a McMurray man for allegedly obtaining another person's credit to get more than $330,000 in financing.

Vincent A. Locastro is charged with nine counts of identity theft.

According to prosecutors, he used the name, date of birth and Social Security number of another person to get financing for nine luxury automobile loans.

The banks involved in the alleged fraud lost more than $330,000, the indictment said.

http://www.post-gazette.net/pg/09364/1024429-53.stm

[fung_derf]

Car stolen: Vincent LoCastro of 102 Standing Rock Drive, McMurray, told Canonsburg police Monday that his red 2003 Mercedes SL500 convertible was stolen from the lot of his dealership, All Pro Auto Mall, South Central Avenue. He told police he drove the car, but it was for sale.



http://www.observer-reporter.com/OR/Story/09-03police-beat

[fung_derf]

Turino
THE U.S. DEPARTMENT OF JUSTICE (DOJ) HAS 20 YEARS TO LOCATE ANY ASSETS THAT TURINO ET AL MAY HAVE. Turino et al will be required to make monthly payments to a crime victims fund which will probably be administered by the DOJ. A person from the DOJ will be assigned to administer the account. There will be an agreement between Turino et al and the DOJ as to how much they will pay monthly to the fund. TURINO ET AL IS SUBJECT TO PERIODIC AUDITS OF THEIR FINANCIAL SITUATION TO DETERMINE IF THE MONTHLY PAYMENT CAN BE INCREASED. The DOJ will review all their banking information including personal living expenses to determine if they are excessive. THE LIVING HELL HAS JUST STARTED FOR TURINO ET AL.

The DOJ has extensive resources available to track down any hidden bank accounts. Turino is subject to contempt of court proceedings should they conceal any assets. The Federal court judge will have no sympathy for these people should any hidden assets surface.

[fung_derf]

Edwards justment....

Edwards judgement out
http://viewer.zoho.com/docs/npkbbc

[fung_derf]

CMKM Diamonds, Inc. Announces New Joint Venture (Press Release)

Posted : Fri, 03 Jul 2009 21:26:31 GMT
Author : CMKM Diamonds Inc.
Category : Press Release


TYLER, Texas - (Business Wire) CMKM Diamonds, Inc. announces the completion of an agreement with 101047025 Saskatchewan Ltd. (“1010”). This agreement is part of an overall settlement of a lawsuit brought by Entourage Mining Ltd. (“Entourage”) against both CMKM and 1010 under Action No. 5075800 in the Supreme Court of British Columbia (the “Entourage Lawsuit”). As a term of the overall settlement, Entourage will consent to a dismissal of the Entourage Lawsuit against both CMKM and 1010, as if it had been heard on its merits and dismissed.

Under the overall settlement of the Entourage Lawsuit, 1010, CMKM, and Entourage agreed to cancel and terminate the previous agreement between CMKM, 1010, and Entourage that was dated October 20, 2005 (the “2005 Agreement”), with respect to certain mineral claims in Saskatchewan that are owned by 1010. In consideration of that dismissal, CMKM will return to Entourage 3 million of the 4.5 million Entourage shares that it acquired under the original agreement, and Entourage has given up all claims or rights to the remaining mineral claims, all of which are owned by 1010. CMKM also returned the remaining 1.5 million shares back to Entourage for a payment from Entourage of $85,000.

Under their new agreement, CMKM and 1010 will form a new company (“New Corp.”) to explore the remaining mineral claims that were the subject matter of the 2005 Agreement. These remaining claims have produced core samples that were drilled by 1010 in late 2005 and early 2006 and have yet to be tested. The New Corp. will, in turn, form a joint venture with 1010 to explore and develop the remaining mineral claims. 1010 will be the sole Operator of the new joint venture and will continue to be the sole owner of the remaining mineral claims. However, the New Corp. will have the right to acquire those remaining claims owned by 1010 by incurring expenditures for exploration, drilling and development on the claims in a cumulative amount that will be no less than four million dollars during the first five years. CMKM is solely responsible for raising no less than 80% of these funds for the New Corp. and 1010 is solely responsible for raising no less than the remaining 20% of these funds for the New Corp.

1010 will hold total voting control of the New Corp. The authorized capital of the New Corp. will consist of Class A voting common shares, without any right to dividends or capital, except that the said Class A common shares will, on a winding up or dissolution, be entitled to repayment of capital paid therefore, and Class B non-voting common shares, with rights to payment of dividends and capital. Eighty million Class B common shares will be allotted and issued to CMKM. Twenty million Class B common shares and ten thousand Class A common shares will be allotted and issued to 1010. CMKM will thus be entitled to 80% of profits earned by the New Corp.

CMKM Diamonds CEO Mark Faulk stated, “This joint venture agreement is another step in our ongoing efforts to return viable assets to CMKM Diamonds. Rights to the remaining claims were retained because they showed the greatest potential for diamonds. Many shareholders originally invested in CMKM because of this potential, and we believe it is in the best interest of Company and its shareholders to pursue this opportunity to benefit from any real value in the remaining claims. The New Corp. intends to begin testing on existing core samples from the remaining claims in the very near future.”

Safe Harbor Statement:

This news release contains certain "forward-looking statements" within the meaning of Section 27a of the Securities Act of 1933 and Section 21e of the Securities Exchange Act of 1934. Although the Company believes the expectations reflected in such forward-looking statements are reasonable, it can provide no assurance that actual results will meet or exceed such expectations.



CMKM Diamonds Inc.
Mark Faulk, 903-262-8397
www.cmkmdiamondsinc.com

[fung_derf]

REPORT:
From the government's 18-page motion to extend Turino's penny ban and freeze assets (footnotes and citations to depositions omitted):

"Turino began violating the penny stock bar less than a year after entry of the Final Judgment. In late 2004, Turino assisted an issuer, BioTech Medics, Inc. ("BioTech Medics") in making a penny stock offering. Turino advised the company's directors on how to structure a reverse merger into a publicly-held shell company and then to conduct am offering of the company's penny stocks. Turino also arranged for the initial investors who were to buy the penny stocks from BioTech Medics.

In early fall of 2004, Keith Houser sought financing to expand a small, privately held medical device company that he founded, Halo Laser BioTherapy ("Halo Laser"). In October 2004, Houser met with Bruce Harlan and another Turino business associate, who was a penny stock promoter, to discuss a possible reverse merger and Rule 504 penny stock offering to raise capital. Harlan had been an attorney to Turino at various times in the past and was also one of Turino's business associates. After the initial meeting attended by Houser, Harlan and the other Turino business associate, Turino took over all subsequent negotiations. The reverse merger would join Halo Laser with the public shell company Corbel Holdings ("Corbel"), to create BioTech Medics. Biotech Medics would have a base of public shareholders and the ability to issue shares to the investing public that could be traded in the over-the-counter Pink Sheets market. Corbel was run nominally, under Turino's control, by Harlan. Under the penny stock offering negotiated by Turino that was to follow the reverse merger, BioTech Medics would issue 25 million penny stock shares to Hamilton Holdings, a company controlled by another Turino business associate, in return for a capital infusion of $1 million.

In October 2004 through early 2005, Turino organized a number of meetings in Las Vegas, attended by Houser , Harlan and various prospective investors, attorneys, accountants, and the stock transfer agent, 1st Global Stock Transfer, Inc. which is owned by another business associate of Turino.

According to the participants in the meetings, Turino was the facilitator, host, and "leader of the band." Turino not only brought together the participants, he even paid to fly in one investor, first class, from Sydney, Australia. Turino arranged and paid for meeting space, which included a private area at a restaurant in Caesar's Palace, and provided lavish meals for the attendees. Turino also had Spooner shuttle participants to and from the airport and meetings. Turino took the lead at the meetings, setting out the proposed terms of the reverse merger and the accompanying Rule 504 penny stock offering. After the closing, in early 2005, Turino presided over a meeting among the participants to settle a dispute.

In short, Turino was the "brains" of this penny stock offering. ...

Beginning in late 2005, Turino used Spooner (Mountain Passages) and, in early 2006, Leslie (Austin Funding, and in 2007, CRL Holdings) as nominees to participate in at least four additional penny stock offerings. ... Spooner and Leslie entered into stock purchase agreements with the Penny Stock Issuers to have new shares issued to them as part of penny stock offerings. Thereafter, these shares were either sold into the market, or transferred to other participants in the offering.

Melissa Spooner was Turino's first nominee. In late 2005, Turino traveled with Spooner to Minnesota, where they organized the Minnesota corporation, Mountain Passages, Inc., under Spooner's name. Turino then had Spooner open various brokerage accounts in the name of Mountain Passages, into which the large blocks of penny stock shares were deposited, and out of which disbursements were made to pay Turino's business associates and the bills and expenses for himself, his then-wife, his children and step-children, and Spooner. ...

Between October 2005 and July 2008, Turino used Mountain Passages and Austin Funding to obtain at least 3.5 billion shares of penny stock from the Penny Stock Issuers. At least 2 billion of these shares were deposited into brokerage accounts in the names of these nominees (and CRL Holdings) and at least 1.8 billion sold into the U.S. securities markets. The proceeds from these sales amounted to over $8.5 million." ... eom

[fung_derf]

Bruce Harlan testimony.....

http://viewer.zoho.com/docs/qaPdpd

[fung_derf]

Keith Houser and Lou Ippolito

http://viewer.zoho.com/docs/qaPdpd

Case 8:02-cv-00822-EAK Document 39-4 Filed 05/29/2009 Page 16 of 23

He had that meeting with Keith and Lou Ippolito and said he was going to do it and then nothing happened.
----------------------------------------------------------------

ippolitois3xloser0

http://ragingbull.quote.com/mboard/memalias.cgi?member=ippolitois3xloser0

ippolitois3xloser0's Information Personal Info Interests & Background

Total posts written: 6
Member since: Sunday 9-Apr-2006
-----

http://ragingbull.quote.com/mboard/boards.cgi?board=BTMD&read=11567

By: ippolitois3xloser0
09 Apr 2006, 02:50 PM EDT
Msg. 11567 of 21047

I guess Edward "Surfit" Thompson isn't being told which extortion threats to put on the boards from Louie Ippolito(CA) in the last few days. Ed, very very clever to stay away my man. Keep moving apartments and changing your numbers. I know of both now genius. Slurpit, want some good advise?? Stop taking Louie's calls and stop calling him, he's not going to be there for you soon. Save some money as well on your cell phone bill and stop the thousand minutes a month back and forth calling each other at all hours of the night. He also hasn't been much of a leader with helping you make any decent money lately has he? Call it a day and do your own thing. Did you retain legal counsel yet for that suit you were just named to?
-----

http://ragingbull.quote.com/mboard/boards.cgi?board=BTMD&read=11568

By: ippolitois3xloser0
09 Apr 2006, 02:59 PM EDT
Msg. 11568 of 21047

Keith A Houser. I would stop calling Louie Ippolito also and stop taking his calls. The weak thug has more heat on him than you could possibly imagine as we speak and the Feds know you guys have been keeping in touch ever since the Vegas meeting at the transfer agent. He's helped you with a few things and we both know that, he's also had Ed Slurpit slander people on the boards here on your behalf. There's a trail on it all Whitey. I see you stopped posting as whiteknight and rdassociates and some other aliases recently, smart old man you are. By the way, how's Kristin doing lately? Time flies, can you belive she'll be 35 in October already? Scary how fast it goes.
-----

http://ragingbull.quote.com/mboard/boards.cgi?board=BTMD&read=11569

By: ippolitois3xloser0
09 Apr 2006, 03:08 PM EDT
Msg. 11569 of 21047

Edward "Surfit coke head with 2 convictions" Thompson. About time you stopped taking calls from 818-312-1940 and 972-274-5533. Not going to do you any favors when they go down soon. Did you think no-one listens to their calls? Your showing up all over the grid and on their taps, i know you just moved but maybe consider changing careers. Your slanderish coke raving posts in jan said " bye bye soon" etc, all full of threats. Nothing has happened, it's been that way for years Edward. Your running with the wrong bunch of weakness and you have nothing but grief to show for it. You also might want to lay off from leaving so many threatening and harrasing extortion voice mails like you have been all year. Every single one being listened to dummy.
-----

http://ragingbull.quote.com/mboard/boards.cgi?board=BTMD&read=11570

By: ippolitois3xloser0
09 Apr 2006, 03:12 PM EDT
Msg. 11570 of 21047

Louie how's the heart been treating you lately? You might also want to find another career before you blow out your heart. They won't be so nice to you in jail this time, didn't you get enough before? Leave the broke CEO's and companies alone would be a good start. If your going to extort at least make sure the CEO or company has a pulse. It's been 27 months since that Bio tech meeting you were at in vegas. You never had anything of value to bring to the table and you still don't. You got some shares and don't know when the gig is up. Move on.
--------------------------------------------------------------------

http://ragingbull.quote.com/mboard/boards.cgi?board=BTMD&read=17258

By: jarta
03 Dec 2007, 07:08 PM EST
Msg. 17258 of 21047
(Reply to 17255 by nufced)

nuffie, ... I listened to the Walters phone interview about 4 weeks ago. It's interesting, but he's a scamster himself.

Turino, Edwards and Jensen have been the subject of posts here since the reverse merger of Halo Laser into Corbel to form Biotech.

Long ago the company posted that they were long gone and a new leaf had been turned over.

Then, we all found out that in addition to not performing very well, the first financers of this company were Jensen and Yarter who brought Turino, Edwards and Barnett (and Ippolito and Seminario) to the BTMD table.

Plus, although the first 504 deal fell through, the evidence is that Houser did 2 more deals with Jensen (one through a Minnesota front). So, is Jensen and his buddies still involved. Houser'd never say.

It doesn;t say much good about anyone who'd be buddying up to Surfit either. But, Houser's doing it.

If the other boyz hadn't tried to stiff Houser, they'd still be here. But, despite being warned about them, Houser chose to deal with them. Now, he gets all bent out of shape because he doesn't want anyone to discover who he associated with and what he did. ... eom

(Voluntary Disclosure: Position- No Position)
-------------------------------------------------------------------

http://ragingbull.quote.com/mboard/boards.cgi?board=BTMD&read=17289

By: scandle2002
03 Dec 2007, 10:24 PM EST
Msg. 17289 of 21047
(Reply to 17284 by jarta)

jarta, I am not sure that I do.

Turino "did not object" to Barnett doing the deal with Jensen. Turino has always been tied to Jensen. Barnett appears beholden to Turino.

I was just speculating as to where the split really lay. Since Barnett was the latecomer to the party, I'd have figured that Turino was still on the company's back with Jensen. On the other hand Treffrey is friendly to the company and Louie (I have to assume Ippolito) threatenned his wive. Louie was cast as one of Turino's & Jensen's muscle guys, so really - aside from making a great mob movie - this viper pit makes no sense.

Involved from Summit till the end of this shell's days.
--------------------------------------------------------------------

POST BY TREFFRY

http://ragingbull.quote.com/mboard/boards.cgi?board=BTMD&read=17500

By: mclt_jing
07 Dec 2007, 07:59 PM EST
Msg. 17500 of 21047

I have been asked to back off this board

because the mental midgets tried to send Louise to Treffry's house AGAIN, just this morning, to threaten him, probably because of my posting. I was told that photos were taken and plates copied, police reports and FBI reports taken. I am sure that you, Jeffy, are the number one topic of conversation at the round table. Gee, can I come to visit you in club fed after you get convicted for stock fraud and making threats upon people for standing up to the big bad bully you are?

Well my little mental midget, be sure to go ahead and send the turds over to the right place next time if you have a message for me. I would not want to miss out on such a lovely visit.
----------------------------------------------------------------

http://ragingbull.quote.com/mboard/boards.cgi?board=BTMD&read=17503

By: factanonverba13
07 Dec 2007, 08:21 PM EST
Msg. 17503 of 21047
(Reply to 17500 by mclt_jing)

Who, pray tell, is Louise?
----------------------------------------------------------------

http://ragingbull.quote.com/mboard/boards.cgi?board=BTMD&read=17505

By: scandle2002
07 Dec 2007, 10:23 PM EST
Msg. 17505 of 21047
(Reply to 17503 by factanonverba13)

I suspect he means Louie Ippolito
-------------------------------------------------------------------

http://www.faulkingtruth.com/Articles/Investing101/1083.html

Conversations with Robert A. Maheu
by Mark Faulk

[excerpt]

Author’s note: After rumors surfaced that mobster Louie Ippolito was the person who set up the original meetings with Michael Williams preceding Maheu’s involvement with CMKM Diamonds, I contacted Bob once more to clarify that information. This is a short excerpt from our conversation, which mostly was just an informal chat about topics that had nothing to do with The Naked Truth: Investing in the Stock Play of a Lifetime, or with CMKM Diamonds.


FOLLOW-UP INTERVIEW, JANUARY 18, 2008:


Faulk: I have heard that someone named Louie Ippolito – are you familiar with him at all?

Maheu: Yeah

Faulk: There is someone who claims that Ippolito is the one who introduced you to Michael Williams originally. Is there any tie-in to that at all?

Maheu: No, I don’t have that recollection at all. My recollection is that Donald Stoecklein had done some work for Michael Williams and that’s how I was introduced…that’s my recollection.

Faulk: But you do know Ippolito?

Maheu: Yes, that’s correct.

[Susie924]

SEC v. Pinnacle Business Management, Inc. et al., Civ. No. 8:02-CV-822-T-EAJ (M.D. Fla.)

SEC Seeks Contempt Against Jeffrey G. Turino for Violating Penny Stock Bar and Obtains Ex Parte Asset Freeze and Extension of Penny Stock Bar

http://www.sec.gov/litigation/litreleases/2008/lr20830.htm

U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 20830 / December 15, 2008
SEC v. Pinnacle Business Management, Inc. et al., Civ. No. 8:02-CV-822-T-EAJ (M.D. Fla.)
SEC Seeks Contempt Against Jeffrey G. Turino for Violating Penny Stock Bar and Obtains Ex Parte Asset Freeze and Extension of Penny Stock Bar

The Commission announced today that, following an ex parte hearing held on December 4, 2008, Judge Elizabeth A. Kovachevich of the U.S. District Court for the Middle District of Florida issued an order directing Jeffrey G. Turino to show cause why the Court should not hold him in contempt for violating a five-year penny stock bar entered against him on December 5, 2003, as part of a settlement of an earlier Commission enforcement action. The penny stock bar prohibited Turino from participating in any penny stock offering. In the December 4th order, the Court finds that the Commission had made a sufficient and proper showing that Turino had violated this bar by participating in penny stock offerings of Biotech Medics, Inc., Equitable Mining Corp., Global Diamond Exchange, Inc., Grand Entertainment and Music, Inc. and OMDA Oil and Gas, Inc. The Commission had previously issued orders temporarily suspending the trading in the securities of two of these companies, Equitable Mining Corp. and Global Diamond Exchange.

The order directs Turino to show cause why the Court should not hold him in contempt, should not require him to disgorge the unlawful proceeds from selling shares obtained in penny stock offerings, and should not make him subject to a permanent penny stock bar. Further, the order freezes certain bank and brokerage accounts held or controlled by, or in the name of Melissa Spooner, Robert Leslie, Mountain Passages, Inc., Austin Funding, LLC and CRL Holdings, Inc. Finally, the order extends the penny stock bar against Turino pending a final hearing on the show cause order.

The penny stock bar against Turino resulted from the Commission's May 8, 2002, enforcement action against Turino, Vincent Lo Castro, and a company they controlled, Pinnacle Business Management, Inc. SEC v. Pinnacle Business Management, Inc. et al., Civ. No. 8:02-CV-822-T-EAK (M.D. Fla.) The Commission's complaint alleged that Turino and the other defendants had made materially false and misleading statements in connection with a proposed spin-off of a Pinnacle business division, and charged them with violating the antifraud provisions of the federal securities laws (Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder). On December 5, 2003, Turino consented to the entry of a final judgment that permanently enjoined him from further violations of these provisions and imposed a $60,000 civil penalty, a permanent officer and director bar, and a five-year penny stock bar.

For additional information, see below:

* Litigation Release No. 17507 (May 8, 2002) (Filing of Enforcement Action Against Turino, Lo Castro, and Pinnacle Business Management, Inc.)
* Litigation Release No. 18506 (December 15, 2003) (Settlements with Turino, Lo Castro and Pinnacle Business Management, Inc.)
* Exchange Act Release No. 34-58271 (July 31, 2008) (Suspension of Trading in the Securities of Global Diamond Exchange, Inc.)
* Exchange Act Release No. 34-55420 (March 8, 2007) (Suspension of Trading in the Securities of Equitable Mining Corp.)



http://www.sec.gov/litigation/litreleases/2008/lr20830.htm

[Susie924]

LOL!

What?

[Mariner*]

Susie I hope this is flattering but this beautiful woman is just screaming out your name.
Your looking good poolside.

[ergo sum]

Derf I made a mistake and I need to correct it. Thanks again.

TNNS-MNIA –LTVI-TLGP
CRHI-SRTU-LTVS

[ergo sum]

TNNS-MNIA –LTVI-TLGP
CHRI-SRTU-LTVS

Keep this for me will ya Derf?

[Vexari]

what makes one think it could not be

mob related?

[Susie924]

Posted by: JENNIFERLYNCH
In reply to: fung_derf who wrote msg# 32294 Date:1/3/2007 4:21:03 AM
Post #of 32306

Jeff Turino Social Security # is 262-29-7718 for IRS... Investigation.

Mary Turino Social Security # is 382-6045-69

Part 2. Jeffery G Turino has not paid tax's in 4 years, and is presently running from the law.

Below is the $3,000,000 Dollar house he bought with the proceeds he scammed off innocent PCBM share holders.

Jeffrey G. Turino resides at 3140 Masters Drive in Clearwater, Florida, link below ias an aerial view of his $3 million Dollar house.

http://imageatlas.globexplorer.com/ImageAtlas/view.do



Part 3. Jeffery G Turino Social Security # is 262-29-7718 for IRS Investigation.

Mary Turino Social Security # is 382-6045-69 . Mary is a school teacher, and cannot explain how she bought this $3 million Dollar house on her income (Reek's of Money Laundering for Jeff Turino)
The house is in Mary's name so Jeffery Turino thinks it will not be confinscated in her name!
The only problem with that is you must be able to prove where the money came from to buy the house, which does not happen on a school teachers earnings!

Call the US Goverment Tax Fraud Hot Line Below, and report Jeffery and Mary Turino immediatly to get your reward of $100,000 dollars.

Tax Fraud Hotline

For people who want to make a difference!

Part 1. Want $100,000 Dollars? Report Jeffery G Turino to the IRS for Tax Fraud Please Read...
Jeffery G Turino Pillfered PCBM, CSON, MLAR, PDVN, OMOG and has caused great financial damage to many people. Some have commited sucide,some are homeless,etc!
Here is your chance to help!

These articles will be placed on message boards exposing Jeffery G Turino, Adam Burnett, Mellisa Spooner(Jeffery G Turinos mistress) who funnels stock, and money for him(MT Passages) as situations, and time permit. Yes Jeffery G Turino, and his Boy friend Adam Burnett have issued an invitation to a dance, and niether can dance a step! But the Fed's can do the two step like it is no bodys business, so it would apear! Jeffery G Turino is an adultress and has been for years, so it should suprise no one that he scammed PCBM, CMKX,OMOG, DTEV, MLAR, CSON and now posting on the IHUB GBDX board in violation of his penny ban as RonnieD, negger0, stockloibster, loganwolferine file an SEC complaint on that as well please.(Ask Jeffery G Turino who put the Fraudlent PR out on GBDX claiming $14million Euros earned , when it really was $900,000 euros in the hole = a lie you say look at the retraction, it is just one of many Jeffery G Turino scams falling in the toilet of lies!
A rummor circulating around the street is that Jeffery G Turino tries to make a deal with the Fed's by throwing Adam under the bus( if true Jeffery G Turino is a known sociopath and has done it before in NY, FL!)
If need be the next article will expose all(and we mean all) of the avenues(Mitchell Gilbert, children who's names Jeffery G Turino has hidden money, stock, valuables in, and there social security numbers like JL = last 4 (2075, then there is good old Pat = last 4(9665), so there will be no problem for a blind person to find Jeffery G Turinos stolen money from innocent share holders. Yes let us not for get next time to discuss Jeffery G Turino relationship with a dirty transfer agent Jeffery G Turino paid $60-$100k to so he could counterfiet shares, as that transfer agent had a Wells Fargo bank Notary paid off to blindly stamp the notary seal. This story will be a best seller one day, but there is just to much information for just this one informative posting.
Jeffery G Turino owes the IRS $1,000,000 Dollars in back tax's he has not paid.
ou always!

Part 3. ALSO USE THIS MIAMI FBI, AND SEC TO REPORT ADAM ERIK BURNET = OMOG CEO = FOR POSESSION OF A 600 MILLION SHARE CERT WITH NO FILING = WHEN THERE WAS ONLY A 900 MILLION SHARE FLOAT = ILLEGAL = THEN FOLLOW UP AND REPORT ADAM BURNETT TO THE SEC LINK AND PHONE NUMBERS LISTED AS WELL = ADAM BURNETT AND JEFFERY G TURINO AS YOU WILL SEE ARE INVOLVED IN A LOT OF DIRTY DEALS TOGATHER.
TELL THE SEC, FBI, DOJ = ADAM ERIK BURNETT WAS INVOLVED IN PDVN, DTEV
DO YOUR PART TO STOP FRAUD NOW PLEASE!
ASK ANY AND ALL FEDERAL OFFICIALS FOR AN IMMEDIATE INVESTIGATION OF FIRST GLOBAL TRANSFER AGENT = HELEN BAGLEY send the link and info below .
1st Global Stock Transfer , LLC

7361 Prairie Falcon Road Suite 110
Las Vegas, NV 89128
USA

Phone: [phone]
Jeffery G Turino, and Mrs Helen Bagley please Thank factanonverba13 for providing all this information and much more.
IMO

Part 2. A lot of dirty stocks have come out of Helen Bagleys First Global Transfer Agent Office = PCBM, CMKX, GBDX just to name a small few!
Call FBI Agent David Nance 702-388-6336, SEC 323-965-3998 and report Jeffery G Turino, as well as asking them to investigate HELEN BAGLEY OF FIRST GLOBAL TRANSFER AGENT to see if she was, and still is a willing instrument of fraud? (You will be astonished at what you find out).
SEC Enforcement Complaint Form
http://www.sec.gov/complaint/cf942sec9570.htm

Part 1. IS CMKI TRANSFER AGENT HELEN BAGLEY DIRTY? BETTER READ...
IS HELEN BAGLEY First Global TA, DIRTY? FILE A SEC, DOJ, FBI COMPLAINT IMMEDIATLY...
There was an attorney named Jim Petrochellie(not entirly sure of correct spelling on last name but the FED'S will figure it out)who died early in the PCBM scam! Jeffery G Turino forged his signatures on PCBM cert's for some time after his death. Ask the FBI, DOJ, SEC to look up the death certificate's date of death, then look at the hundreds of million shares issued and signed off by him, forged after his death! WHY DID FIRST GLOBAL PROCESS A DEAD ATTORNEYS CERTS WOULD BE A GOOD QUESTION? Dose the transfer agent know? You would think the Transfer Agent would have an obligation to know or find out if the attorney signing millions of PCBM certs was alive would you not?
Ask the FBI, DOJ, SEC to investigate who was the Notary who stamped the Dead Attorney's certs please.

OMOG Criminal CEO ARRESTED 3 TIMES FILE A SEC COMPLAINT...

Adam did not disclose his criminal arrest to share holders in violation of Sarban Oxley. Also while Adam Burnett was retiring shares he was illegaly adding to the float just like Jeffery Turino did in PCBM. Turino tought Adam the crook who has pillfered DTEV, OMOG, GMSC, NOW TURINO AND ADAM ARE PILLFERING GBDX = THAT IS WHY THE GBDX IHUB BOARD KICKED FUNG DERF OFF WHO WAS ON TO TURINO POSTING AS RONNIED, NEGGER0, LOGANWOLFERINE, STOCKLOBSTER. YES REPORT JEFF TURINO VIOLATING HIS PENNY BAN NOW IN GBDZ WHERE JEFFERY TURINO IS MODERATOR OF THE IHUB GBDX BOARD(RONNIED). PLEASE DO YOUR PART TO REPORT ADAM BURNETT, AND HIS BOSS JEFFERY TURINO NOW, AND RID THE MARKET OF THESE CROOKS FOR EVER.
Justice and Civil Infraction Cases

COURT CASE: F93032008

State Case#:131993CF0320080001XX


Name: BARNETT, ADAM ERIK


DOB: 06/11/1974




Da Date Filed: 09/21/1993


Date Closed: 10/12/1993


Warrant Type:

Hearing Date:


Hearing Time:


Hearing Type:

Cou Courtroom: REGJB-JUSTICE BUILDING, ROOM#:2-5

Address: 1351 N.W. 12 ST

Previous Case: J92012613C

J Judge: SCHWARTZ, LAWRENCE A

Bf ile Section: F015


File Location: DESTROYED


Box Number: -



Seq#


Charge


Charge Type


Disposition

1


GRAND THEFT/3D/300+/-5K


FELONY


NO ACTION



Criminal Justice and Civil Infraction Cases

COURT CASE: M92078655

State Case#: 1319 92CO0786550001XX


Name: BARNETT, ADAM ERIK


DOB: 06/11/1974




Dat Date Filed: 12/03/1992


Date Closed: 11/22/1993


Warrant Type:

H Hearing Date:


Hearing Time:


Hearing Type:

C Courtroom: REGJB-JUSTICE BUILDING, ROOM#:6-6

Address: 1351 N.W. 12 ST

Judge: NEWMAN, EDWARD

De Defense Attorney: STEVENS, PAUL

Bfil Case Section: M002


File Location: DESTROYED


Box Number: -

ALT S Action: M002


ALT/Backup Judge: NEWMAN, EDWARD









Seq#


Charge


Charge Type


Disposition

1


PETIT LARCENY, THEFT


COUNTY ORDINANCE


NOLLE PROS-COMP PTI




Criminal Justice and Civil Infraction Cases

COURT CASE: B01057856

State Case#:1 320 01 MO0578560001XX


Name: BARNETT, ADAM ERIK


DOB: 06/11/1974




Dat Date Filed: 10/04/2001


Date Closed: 04/03/2002


Warrant Type:

Hearing Date:


Hearing Time:


Hearing Type:

Courtroom: REGJB-JUSTICE BUILDING, ROOM#:5-7

Address: 1351 N.W. 12 ST

Judge: KRIEGER-MARTIN, LUISE

Bf File Section: M005


File Location: RECORD CENTER


Box Number: 86-207

ALT Section: M005


ALT/Backup Judge: KRIEGER-MARTIN, LUISE









Seq#


Charge


Charge Type


Disposition

1


ARRESIST ARR W/O VIOL


MUNICIPAL ORDINANCE


NOLLE PROS

Jennifer Lynch SS# 590-64-2075=$ Laundering
Address rummored to be the one listed below.
Jennifer Lynch [phone] 10645 Bardilino St, Las Vegas, NV 89141 Map
Jennifer Lynch [phone] Las Vegas, NV 89130 Map
http://www.google.ca/search?hl=en&q=+Jennifer+Lynch+LAS+VEGAS&btnG=Search&meta=

Jennifer is rumored(LOL) to be hiding some of Jeffery G Turino's
looted stock $ in her name in accounts = check stock in her name as well as bank accounts in Nevada and Florida. Give the social security # to FBI agent David Nance 702-366-7241, and the SEC 323-965-3998.
If Jennifer Lynch , Jeffery G Turinos daughter by marriages is not hiding his money, then she can explain being in college at UNLV with a fairly new Mercedes Benz, as well as all money in all bank accounts,etc, not to mention all the other things in her name.

Jennifer Lynch go's to UNLV(University of Las Vegas Nevada) and is in the pledge class of 2004 listed on the web link below
http://www.unlv.edu/student_orgs/agd/members.html
Jennifer Lynch sorority is Alpha Gamma Delta
http://www.unlv.edu/student_orgs/agd/members.html

PS: Children are off limits = But when children seem to be willing participants in Laundering Jeffery G Turinos Stolen money from honest innocent investors = they can be RICO charged as well!
Look at it this way Jeffery G Turino has a aprox. $3 million dollar house, Viper = His daughter Jennifer has a Newer Mercedz Benz, bank accounts, etc! And a large part of that money is stolen from innocent investors like you it would appear.

Jennifer Lynch would have a very hard time explaining all those assets at roughly only 20 years old = now would she not?

Jeffery G Turino has dirty'ed up his entire family in money laundrying it would seem.
There is Pat, and Samatha(Philly town house = is this dirty $ as well, more to come possibly later on Samantha of Villonova law school) .
Depending on the Take Down Associations time = this info. might be provided as well. You have more than enough to start an FBI investigation on all of Jeffery G Turino's family listed to date.

PS: We would like to thank Factsnonzero(Medical board)(rumored to be adumb buttnet for providing all this info. forwarded to the Fed's)

Thank You facts for bringing all the bad people down by your actions, after finding out Jeffery G Turino tried to rat on you and your handler. Keep all the informative emails comming.

IMO

Jeffery G Turino Social Security # is 262-29-7718 for IRS Investigation.

Mary Turino Social Security # is 382-6045-69

Part 2. Jeffery G Turino has not paid tax's in 4 years, and is presently running from the law.

Below is the $3,000,000 Dollar house he bought with the proceeds he scammed off innocent PCBM share holders.

Jeffrey G. Turino resides at 3140 Masters Drive in Clearwater, Florida, link below ias an aerial view of his $3 million Dollar house.

http://imageatlas.globexplorer.com/ImageAtlas/view.do



Part 3. Jeffery G Turino Social Security # is 262-29-7718 for IRS Investigation.

Mary Turino Social Security # is 382-6045-69 . Mary is a school teacher, and cannot explain how she bought this $3 million Dollar house on her income (Reek's of Money Laundering for Jeff Turino)
The house is in Mary's name so Jeffery Turino thinks it will not be confinscated in her name!
The only problem with that is you must be able to prove where the money came from to buy the house, which does not happen on a school teachers earnings!

Call the US Goverment Tax Fraud Hot Line Below, and report Jeffery and Mary Turino immediatly to get your reward of $100,000 dollars.

Tax Fraud Hotline

For people who want to make a difference!

Part 1. Want $100,000 Dollars? Report Jeffery G Turino to the IRS for Tax Fraud Please Read...
Jeffery G Turino Pillfered PCBM, CSON, MLAR, PDVN, OMOG and has caused great financial damage to many people. Some have commited sucide,some are homeless,etc!
Here is your chance to help!

These articles will be placed on message boards exposing Jeffery G Turino, Adam Burnett, Mellisa Spooner(Jeffery G Turinos mistress) who funnels stock, and money for him(MT Passages) as situations, and time permit. Yes Jeffery G Turino, and his Boy friend Adam Burnett have issued an invitation to a dance, and niether can dance a step! But the Fed's can do the two step like it is no bodys business, so it would apear! Jeffery G Turino is an adultress and has been for years, so it should suprise no one that he scammed PCBM, CMKX,OMOG, DTEV, MLAR, CSON and now posting on the IHUB GBDX board in violation of his penny ban as RonnieD, negger0, stockloibster, loganwolferine file an SEC complaint on that as well please.(Ask Jeffery G Turino who put the Fraudlent PR out on GBDX claiming $14million Euros earned , when it really was $900,000 euros in the hole = a lie you say look at the retraction, it is just one of many Jeffery G Turino scams falling in the toilet of lies!
A rummor circulating around the street is that Jeffery G Turino tries to make a deal with the Fed's by throwing Adam under the bus( if true Jeffery G Turino is a known sociopath and has done it before in NY, FL!)
If need be the next article will expose all(and we mean all) of the avenues(Mitchell Gilbert, children who's names Jeffery G Turino has hidden money, stock, valuables in, and there social security numbers like JL = last 4 (2075, then there is good old Pat = last 4(9665), so there will be no problem for a blind person to find Jeffery G Turinos stolen money from innocent share holders. Yes let us not for get next time to discuss Jeffery G Turino relationship with a dirty transfer agent Jeffery G Turino paid $60-$100k to so he could counterfiet shares, as that transfer agent had a Wells Fargo bank Notary paid off to blindly stamp the notary seal. This story will be a best seller one day, but there is just to much information for just this one informative posting.
Jeffery G Turino owes the IRS $1,000,000 Dollars in back tax's he has not paid.
ou always!

Part 3. ALSO USE THIS MIAMI FBI, AND SEC TO REPORT ADAM ERIK BURNET = OMOG CEO = FOR POSESSION OF A 600 MILLION SHARE CERT WITH NO FILING = WHEN THERE WAS ONLY A 900 MILLION SHARE FLOAT = ILLEGAL = THEN FOLLOW UP AND REPORT ADAM BURNETT TO THE SEC LINK AND PHONE NUMBERS LISTED AS WELL = ADAM BURNETT AND JEFFERY G TURINO AS YOU WILL SEE ARE INVOLVED IN A LOT OF DIRTY DEALS TOGATHER.
TELL THE SEC, FBI, DOJ = ADAM ERIK BURNETT WAS INVOLVED IN PDVN, DTEV
DO YOUR PART TO STOP FRAUD NOW PLEASE!
ASK ANY AND ALL FEDERAL OFFICIALS FOR AN IMMEDIATE INVESTIGATION OF FIRST GLOBAL TRANSFER AGENT = HELEN BAGLEY send the link and info below .
1st Global Stock Transfer , LLC

7361 Prairie Falcon Road Suite 110
Las Vegas, NV 89128
USA

Phone: [phone]
Jeffery G Turino, and Mrs Helen Bagley please Thank factanonverba13 for providing all this information and much more.
IMO

Part 2. A lot of dirty stocks have come out of Helen Bagleys First Global Transfer Agent Office = PCBM, CMKX, GBDX just to name a small few!
Call FBI Agent David Nance 702-388-6336, SEC 323-965-3998 and report Jeffery G Turino, as well as asking them to investigate HELEN BAGLEY OF FIRST GLOBAL TRANSFER AGENT to see if she was, and still is a willing instrument of fraud? (You will be astonished at what you find out).
SEC Enforcement Complaint Form
http://www.sec.gov/complaint/cf942sec9570.htm

Part 1. IS CMKI TRANSFER AGENT HELEN BAGLEY DIRTY? BETTER READ...
IS HELEN BAGLEY First Global TA, DIRTY? FILE A SEC, DOJ, FBI COMPLAINT IMMEDIATLY...
There was an attorney named Jim Petrochellie(not entirly sure of correct spelling on last name but the FED'S will figure it out)who died early in the PCBM scam! Jeffery G Turino forged his signatures on PCBM cert's for some time after his death. Ask the FBI, DOJ, SEC to look up the death certificate's date of death, then look at the hundreds of million shares issued and signed off by him, forged after his death! WHY DID FIRST GLOBAL PROCESS A DEAD ATTORNEYS CERTS WOULD BE A GOOD QUESTION? Dose the transfer agent know? You would think the Transfer Agent would have an obligation to know or find out if the attorney signing millions of PCBM certs was alive would you not?
Ask the FBI, DOJ, SEC to investigate who was the Notary who stamped the Dead Attorney's certs please.

Ask Levine(PCBM,CMKX) accountant who was Turinos Acct located in New Jersey Will post his number in the next session of post if necessary!


Public Reply Private Reply Keep Last Read Previous Next

Add Board Mark PCBM Report TOS Violation

[fung_derf]

BTMD filing......

BIOTECH MEDICS, INC.
A Nevada Corporation
October 31, 2006
Information Provided Pursuant to
Rule 15c2-11 of the Securities and
Exchange Act of 1934, as Amended
2
DISCLOSURE STATEMENT
PURSUANT TO RULE 15c2-11
OF THE SECURITIES AND EXCHANGE ACT OF 1934
Current Information Regarding
BIOTECH MEDICS, INC.
The following information is provided to assist securities brokerage firms with
“due diligence” compliance. This statement has not been filed with the NASD or any
other regulatory agency. This information is set forth below as to BIOTECH MEDICS,
INC. (referred to as “We” or the “Company”). We were incorporated on December 29,
1997, in the State of Nevada, as Summit Property Group, Inc. (hereinafter referred to as
“the Issuer”). This information is provided for the purpose of providing information to
broker-dealers trading in the securities of the Issuer in compliance with Rule 15c2-
11(a)(5) of the Securities Exchange Act of 1934, as amended. The information provided
follows the same numbering system found in the rule to wit:
Item 1. Exact Name of Issuer and Predecessor:
Issuer: BioTech Medics, Inc. from November 19, 2004 to
present
Previous Names: Corbel Holdings, Inc. from April 30, 2001 to
November 18, 2004
Summit Property Group, Inc. from December 29,
1997 to April 29, 2001
Item 2. Address of Issuer’s Principal Executive Offices:
Corporate Services of Nevada
507 North Division Street
Carson City, NV 89703
Telephone No.: [phone]
Facsimile No.: [phone]
Website Address: www.biotechmedics.com
3
Item 3. State and Date of Incorporation:
We were incorporated on December 29, 1997, in the State of Nevada.
Item 4. Exact Title and Class of Security:
We are currently authorized to issue two classes of stock, common stock
and preferred stock. The CUSIP for our common stock is 090699109.
Our common stock has only been quoted on the Pink Sheets on an
unsolicited basis since it initiated trading on the Pink Sheets. Our current
stock symbol is “BTMD.” Pink Sheets has discontinued the display of
quotes on pinksheets.com for our common stock until adequate current
information is made available.
Our preferred stock does not have a CUSIP and is not publicly traded.
Item 5. Par Value or Stated Value of Security:
Our common stock has a par value of $0.001 per share.
Preferred Stock par value of $.001 per share.
Item 6. Number of Shares or Total Amount of the Securities Outstanding As
of the End of the Issuer’s Most Recent Fiscal Quarter and Fiscal Year
and any Offerings of Securities in the Last Two Years:
A. Number of Shares Outstanding
Common Stock
We are authorized to issue 500,000,000 shares of common stock, par value
$0.001.
As of the date we provided information in response to this item, we had
253,331,933 shares of common stock issued and outstanding, held by
approximately 4717 shareholders. Of those 253,331,933 shares of
common stock, 110,585,857 were free trading.
Preferred Stock
We are authorized to issue 10,000,000 shares of preferred stock, par value
$.001, the rights, privileges, and preferences of which may be set by the
Board of Directors without further shareholder approval.
As of the date we provided information in response to this item, no shares
of our preferred stock have been issued.
4
B. Offerings of Securities
Within the last two year periods ending on the date of our last fiscal year
and as of the date of this Disclosure Statement, we have had the following
offerings of our securities:
1. In December, 2004, the Company issued 17.25 million Pennsylvania
Exempt 504 common shares to Hamilton Holding PA Corp and/or their
assigns. The Company was to receive $1 million under a Promissory Note
signed by Hamilton. However, the Company only received less than
$73,000. The matter is in litigation in the 68th Texas Dist. Court in Dallas,
Texas.
2. The Company issued in 2005 1 million Pennsylvania Exempt 504
Common shares to Mark Brummel and 5 million Pennsylvania Exempt
504 Common shares to Sean Meagan for the sum of $9690.00.
3. The Company issued 4,800,000 Texas Exempt 504 Common shares to
Lone Star Equity Group in 2005 for $14,072.80.
4. The Company issued Pennsylvania Exempt 504 Common Shares to
KRKA for $11,130.00 in 2005 as a part of the Hamilton issue in 1 above.
5. In 2005, the Company issued 765,306 Minn. Exempt 504 Common
shares to Alliance Equities for $5,357. Other consideration was a part of
this transaction to the Company legal counsel.
6. In 2006 the Company issued Minn. Exempt 504 Common Shares to
Redwood for $34,500 for 7,428,571.
7. In 2006 the Company issued 1,000,000 Texas Exempt 504 Common
Shares to Jarvis Adventures, Inc. for $5,000.
Item 7. Name and Address of Transfer Agent:
Transfer Online
317 SW Alder Street, 2nd Floor
Portland OR 97204
Telephone No. [phone]
Our transfer agent is registered under the Exchange Act.
Item 8. Nature of the Issuer’s Business:
A. Business Development
5
We were organized on December 29, 1997, to operate as a property owner
and/or management service. On December 7, 2004, we acquired
HaloLaser BioTherapy, LLC, and now focus on alternative medicine and
medical devices for the twenty-first century.
Information concerning the following specific items is furnished to
provide a more complete understanding of the issuer’s business
development:
1. The form of organization of the Issuer;
We are a Nevada corporation.
2. The year that the Issuer (or any predecessor) was organized;
We were incorporated on December 29, 1997, in the State of
Nevada, as Summit Property Group, Inc.
3. The Issuer’s fiscal year end date;
Our fiscal year end date is December 31.
4. Whether the Issuer (and/or any predecessor) has been in
bankruptcy, receivership or any similar proceeding;
We have not been in bankruptcy, receivership or any similar
proceeding.
5. Whether the Issuer has made any material reclassification,
merger, consolidation, or purchase or sale of a significant
amount of assets not in the ordinary course of business;
On December 7, 2004, we acquired all of the outstanding
membership interests of HaloLaser BioTherapy, LLC in exchange
for 65,000,000 shares of our common stock.
On February, we acquired substantially all of the assets of FHJ
Scientific, Inc., in exchange for 1,250,000 shares of our common
stock, restricted in accordance with Rule 144 and signed a
promissory note.
6. Any default of the terms of any note, loan, lease, or other
indebtedness or financing arrangement requiring the issuer to
make payments;
6
None that have not been extended or re-negotiated.
7. Any change of control;
On December 7, 2004, we acquired all of the outstanding
membership interests of HaloLaser BioTherapy, LLC in exchange
for 65,000,000 shares of our common stock. The entire prior board
of directors resigned and the Company came under new
management and a new board of directors. The Company will
notify Pinksheets should there be a change in control.
8. Any increase in 10% or more of the same class of outstanding
equity securities;
On December 7, 2004, BTMD acquired all of the outstanding
membership interests of HaloLaser BioTherapy, LLC in exchange
for 65,000,000 shares of our common stock. At the time this did
not constitute an increase greater than 10% of outstanding equity
securities. Through the issuance of 504 stock in 2005 and 2006,
this did constitute a greater than 10% increase or more of the same
class of outstanding equity securities (see 6.B 1-7 above).
9. Describe any past, pending or anticipated stock split, stock
dividend, recapitalization, merger, acquisition, spin-off or
reorganization;
On December 7, 2004, we acquired all of the outstanding
membership interests of HaloLaser BioTherapy, LLC in exchange
for 65,000,000 shares of our common stock. The Company issued
a press release advising that the board of directors had issued a
Resolution that the Company would not have a “stock split” during
the first 12 months of operation under the new management.
On December 17, 2004, the Company acquired all of the common
stock of Charles R. Crane MD & Associates, Inc., for 1,250,000
common shares and a promissory note for $1.25 million.
On March 18, 2005, the Company acquired the four (4) US Letters
of Patent from FHJ Scientific for 1,250,000 common shares and a
promissory note for $1.25 million.
10. Any delisting of the Issuer’s securities by any securities exchange
or NASDAQ or deletion from the OTC Bulletin Board;
Our securities have not been de-listed by any securities exchange
or NASDAQ or deleted from the OTC Bulletin Board.
7
11. Any current, past, pending or threatened legal proceedings or
administrative actions either by or against the Issuer that could
have a material effect on the Issuer’s business, financial
condition, or operations. Any current, past or pending trading
suspensions by a securities regulator.
The Company is in litigation with Adam Barnett, an individual of
Miami, Florida. Legal Counsel have issued an opinion that this is
a frivolous lawsuit which should have no adverse material effect
on the Company.
B. Business of Issuer
We (1) sell one or more types of FDA cleared medical laser devices for
the treatment of numerous symptoms and physical ailments of the human
body associated with pain; (2) train and certify medical professionals in
the use of our laser devices; (3) manage; market and affiliate with pain
management and wellness medical centers in the United States; and (4)
acquire US letters of patent and proprietary SHBAN Solution products
and/or devices that compliment our goals of offering alternative medicine
for the twenty-first century.
Information concerning the following specific items is provided to the
extent material to an understanding of the issuer:
1. Issuer’s primary and secondary SIC Codes;
Primary: 8090 (Health & Allied Services)
Secondary: 62134 (Physical, Occupational Therapy)
Other: 62111 (Offices of Physician)
62151 (Medical & Diagnostic Labs)
2. If the Issuer has never conducted operations, is in the
development stage or is currently conducting operations;
We are currently conducting operations.
3. State the names of any parent, subsidiary, or affiliate of the
issuer, and describe its business purpose, its method of operation,
its ownership, and whether it is included in the financial
statements attached to this disclosure document;
The Company issues a combined financial statement with the
income and expenses of the Charles R. Crane MD & Associates,
Inc., Pain Management & Wellness Clinic in Dallas, Texas.
8
4. Effect of existing or probable governmental regulations on the
business;
Not material to an understanding of the issuer.
5. An estimate of the amount spent during each of the last two
fiscal years on research and development activities, and, if
applicable, the extent to which the cost of such activities are
borne directly by customers;
$25,000 in Research & Development. The cost will be amortized
over 5 years.
6. Costs and effects of compliance with environmental laws
(federal, state and local);
The Company is required to comply with the Food & Drug
Administration in the operation of medical lasers. The cost of
compliance is less than $2,000 per year per laser. The medical
lasers are declared “non-hazardous” by the FDA, therefore, no
environmental laws will impact the Company.
7. Number of total employees and number of full time employees.
We have a total of 9 employees, 3 of which are full time
employees
C. Investment Policies
Not Applicable.
Item 9. Nature of Products and Services Offered:
1. Principal products or services, and their markets;
The BioTech L3aser, an FDA 510(k) authorized medical laser, is
one of the most powerful Class III B medical lasers in the United
States. The BioTech L3aser’s patented proprietary protocols,
frequency spectrum and high wattage provide the capabilities
necessary to work the laser’s healing effect to reduce or eliminate
pain through biological stimulation over any area of the body.
The BioTech Pain Management & Wellness Centers will combine
the proprietary BioTech L3aser medical laser device, blood testing,
nutrition education with BioBody Products and lifestyle change
9
programs to provide immediate aid to those in acute and chronic
pain and help patients regain strength and well-being.
2. Distribution methods of the products or services;
The NeuroLase Medical Laser Device may only be sold to licensed
medical practitioners (i.e. medical doctors, chiropractors,
osteopaths, podiatrists and dentists). In some states an
acupuncturist may be sold a laser.
3. Status of any publicly announced new products or services;
The Company is negotiating to sell a medical laser and affiliate
with a Pain Management & Wellness Center in Panama City,
Panama.
The Company is manufacturing its SHBAN Solution and offering
it in 3 oz, 16oz, 32 oz, and 5 gallon quantities.
4. Competitive business conditions, the issuer’s competitive position
in the industry, and methods of competition;
There are no known active US companies that have high powered
Class III B laser devices similar to the NeuroLase or BioTech
L3aser with the patented broad frequency range between 660nM
and 1200nM and proprietary high power (up to 1200 mW)
afforded the Company as a distributor and user of the BioTech
L3aser under the rights granted to an end user of the spectrum.
Eight or more known US and foreign companies have sought FDA
510(k) marketing authorization for their laser therapy devices:
Microlight, Erconia, Thor, Quantumm, Dynatronics, Laser
Therapeutics and Avicenna. All have been granted FDA clearance
for specified marketing, but six of the eight operate at 50% to 90%
less power.
The other companies do not have the more powerful lasers because
they do not have the patents necessary to have the prerequisite
penetrating power and light spectrum for the laser as does the
NeuroLase and BioTech L3aser to work quickly, successfully and
properly on human muscle and tissue.
There are over 37 known worldwide laser manufacturers that
produce flashlight size or small battery pack lasers that sell within
a range of $ 750 to $49,995. Many low powered lasers are utilized
on animals by veterinarians and have been upgraded for human
use.
10
The few desktop flashlight lasers designed for physicians range in
price from $2,500 to $24,999. They operate at one-tenth to onehalf
the power of the BioTech L3aser machines. Consequently, to
accomplish what the BioTech L3aser does in 5 to 20 minutes over
one-quarter of a human body would take a competitor’s laser over
eight hours and numerous visits to the doctor’s office.
The SHBAN solution is protected by 4 US Letters of Patent owned
by the Company. SHBAN is a very powerful antibacterial, antiviral,
anti-mold and anti-fungus topical disinfectant. It is superior
because it is non-bleaching, odorless, colorless and non-toxic;
therefore, when used as directed it is quick and safe to use around
humans, animals and it does not harm the environment.
5. Sources and availability of raw materials and the names of
principal suppliers;
The Company is a distributor for the NeuroLase 150C Medical
Laser Device manufactured by Spectrum Laser in Colorado
Springs, CO. There are ample lasers available at any given time so
that the Company may sell them.
6. Dependence on one or a few major customers;
We do not depend on one or a few major customers.
7. Patents, trademarks, licenses, franchises, concessions, royalty
agreements or labor contracts, including their duration;
The distribution agreement with Spectrum Laser is for three (3)
years and renewable. The relationship between Spectrum and the
Company is on very good terms.
The SHBAN patents require that a net royalty be paid to the
original patent holders via FHJ Scientific for the life of the patents.
The Company has filed with the US Patent & Trademark Office
for trademarks on BioTech Medics, BioTech L3asers, SHBAN.
The Company has no labor contracts.
8. The need for any government approval of principal products or
services. Discuss the status of any requested government
approvals.
11
After a lengthy 10 year research and development period with the
NeuroLase Medical Device the FDA granted a 510(k) marketing
clearance in November, 2003. Clinical medical studies are
currently being conducted utilizing the NeuroLase. No adverse
rulings are expected by the FDA which would negatively impact
the Company.
Item 10. Nature and Extent of Issuer’s Facilities:
The Company maintains its Nevada legal corporate offices at
Corporate Services of Nevada, 507 North Division Street,
Carson City, NV 89703
BTMD’s Texas corporate headquarters is located at 222 West Las Colinas
Boulevard, Suite 1650 East Tower, Irving, TX 75039. We entered into a
lease agreement dated December 7, 2004 to lease the office space for our
Texas corporate headquarters for a term of One (1) year, renewable
annually.
The Company also has a lease with Northpoint IV at 12606 Greenville
Avenue, Suite 105, Dallas, TX 75234 for the BioTech Medics Pain
Management & Wellness Center with Dr. Charles R. Crane.
We do not own any property or properties for which the book value
amounts to 10 percent or more of the total assets of the Company and its
consolidated subsidiaries for the last fiscal year.
Item 11. Name of the Chief Executive Officer, Members of the Board of
Directors, as well as Counsel, Accountant and Public Relations
Consultant:
A. Officers, Directors and Advisors
1. Management
Our directors and officers are as follows:
Name Title
Keith A. Houser Chairman of the Board and Chief
Executive Officer
Charles R. Crane President and Director
Kim Peralta Jacobs Secretary/Treasurer and Director
12
Keith A. Houser has been our Chairman of the Board and Chief
Executive Officer since December 7, 2004. From 1994 to 1998, Mr.
Houser advised Arlington Ophthalmology Association and David
Kleiman, M.D. in the final stages of FDA approval of the eximer eye laser
for the LASIK treatment of the correction of nearsightedness. In 2001,
Mr. Houser founded and from 2001 to 2004, was president of NutriHealth
Marketing, subsequently known as HaloLaser BioTherapy, LLC (“Halo”),
which became the primary distributor for the NeuroLase Medical Laser
Device and merged with BioTech Medics in December 2004. Mr. Houser
has an extensive marketing background in radio and television
broadcasting from 1966 through 2000. He has managed, owned and/or
operated radio and television states from Phoenix, AZ to New York City.
As of the date we provided information in response to this item, Mr.
Houser has proxy authority for 145 million shares of BTMD common
stock.
Charles R. Crane has been our President and Director since December 7,
2004. Over the past thirty years, Dr Crane has operated a private medical
practice, specializing in Physical Medicine & Rehabilitation and
Electromyograpy. In addition, he is currently a medical consultant for
ReviewMed, Shorman Solutions, Austin & Associates and Forte. He is
not currently a member of any other board of directors. As of the date we
provided information in response to this item, he owned 3 million shares
of BTMD common stock.
Kim Peralta Jacobs has been our Secretary/Treasurer and Director since
December 7, 2004. Over the past ten years, Dr. Jacobs has operated a
private chiropractic practice in Overland Park, Kansas. She is not
currently a member of any other board of directors. As of the date we
provided information in response to this item, Dr. Jacobs owned
approximately 507,000 shares of BTMD common stock.
2. General Partners;
None.
3. Investment Banker;
None.
4. Promoters;
Goldstake Enterprises, LLC, Sacramento, CA.
5. Control Persons;
13
Please see the above disclosure for Keith A. Houser, Charles R.
Crane and Kim Jacobs.
6. Legal Counsel;
Our corporate legal counsel is:
David Morris, Esq.
The Morris Law Firm
Dallas, Texas
and securities legal counsel is
The Lebrecht Group
Brian Lebrecht, Esq.
S. Jordan, Utah
7. Accountant or Auditor;
Our independent certified public accountant is Michael Morris,
CPA. His telephone number is 702-253-7511 in Las Vegas, NV.
8. Public Relations Consultant.
No.
B. Legal/Disciplinary History
To the best of our knowledge, none of the foregoing persons has, during
the last five years, been the subject of the following except as follows:
1. A conviction in a criminal proceeding or named as a defendant
in a pending criminal proceeding (excluding traffic violations
and other minor offenses);
No.
2. The entry of an order, judgment, or decree, not subsequently
reversed, suspended or vacated, by a court of competent
jurisdiction that permanently or temporarily enjoined, barred,
suspended or otherwise limited such person’s involvement in any
type of business, securities, commodities, or banking activities;
No.
14
3. A finding or judgment by a court of competent jurisdiction (in a
civil action), the SEC, the CFTC, or a state securities regulator
of a violation of federal or state securities or commodities law,
which finding or judgment has not been reversed, suspended, or
vacated;
No.
4. The entry of an order by a self-regulatory organization that
permanently or temporarily barred, suspended or otherwise
limited such person’s involvement in any type of business or
securities activities.
No.
C. Beneficial Owners
The following table sets forth, as of October 31, 2006, certain information
with respect to the Company's equity securities owned on record or
beneficially by (i) each Officer and Director of the Company; (ii) each
person who owns beneficially more than five percent (5%) of each class of
the Company's outstanding equity securities; and (iii) all Directors and
Executive Officers as a group.
Common Stock
Title of
Class
Name and Address
of Beneficial Owner (1)
Amount and Nature of
Beneficial Ownership
Percent
of Class (2)
Common
Stock
Keith A. Houser 125,000,000 Shares
Trustee
49.3%
Common
Stock
Charles R. Crane 23,000,000 Shares
Trustee
9.1%
Common
Stock
Kim Peralta Jacobs 6,517,000 Shares
Trustee
2.5%
Common
Stock
Executive Officers and
Directors as a Group
(3 Persons)
154,517,000 Shares 60.9%
__________
(1) Unless otherwise noted, the address of each beneficial owner is in c/o The Company.
(2) Based on 253 million shares outstanding as of October 31, 2006, 35 million shares of
common stock are subject to options or warrants currently exercisable, or exercisable
within 60 days, are deemed outstanding for purposes of computing the percentage of the
person holding such options or warrants, but are not deemed outstanding for purposes of
computing the percentage of any other person.
15
D. Disclosure of Certain Relationships
Approximately 60.9% of our outstanding shares of common stock are held
by BioTech Medics Investment Unit Trust, of which Keith A. Houser,
Chairman of the Board and Chief Executive Officer, Charles R. Crane,
our President and Director, and Kim Jacobs, our Secretary/Treasurer and
Director are beneficiaries.
Item 12. Issuer’s Most Recent Balance Sheet and Profit and Loss and Retained
Earnings Statements:
Our unaudited financial statements as of the quarter plus one month ended
October 31, 2006, are enclosed herewith. Our CPA has not completed
review of these statements; however, the CPA has been instructed to
complete the review as soon as possible.
Item 13. Similar Financial Information for Such Part of the Two Preceding
Fiscal Years as the Issuer or its Predecessor Has Been in Existence:
Our unaudited financial statements as of the end of the last two fiscal
years ended December 31, 2005, and 2004, are enclosed herewith. The
current management and board of directors were not in control of the
Company during 11 months of 2004. Therefore, 2004 is not a reflection
of current management and the Board of Director’s leadership.
Item 14. Whether Quotation is Being Submitted or Published Directly or
Indirectly on Behalf of Issuer, or any Director, Officer, or any Person,
Directly or Indirectly the Beneficial Owner of More Than Ten Percent
(10%) of the Outstanding Shares of the Issuer’s Equity Securities,
and, if so, the Name of Such Person, and Basis for any Exemption
under the Federal Securities Laws for any Sale of Such Securities on
Behalf of Such Person:
To the best of management’s knowledge, no quotations are being
submitted by any broker or dealer on behalf of the Issuer or any director,
officer, or ten percent (10%) shareholders.
All information contained herein is subject to change, modification and/or
re-vision without notice. However, issuer will notify Pinksheets of any
material changes.
16
Dated this 6th day of November 2006, at Carson City, Nevada.
BIOTECH MEDICS, INC.
Authorized Electronic Signature
_______________________________
By: Keith A. Houser
Its: Chief Executive Officer
17
BioTech Medics, Inc.
Pinksheets: BTMD.PK
Unaudited Balance Sheet
January 1, 2006 through October 31, 2006
ASSETS
Cash $ 122,099
Fixed Assets 85,000
Other Assets 3,362,900
TOTAL ASSETS $ 3,569,999
LIABILITIES
Accounts Payable $ 81,635
Current Liabilities 2,305,876
Long Term Liabilities 120,000
TOTAL LIABILITIES $ 2,513,303
EQUITY $ 1,056,696
TOTAL LIABILITIES & EQUITY $ 3,569,999
18
BioTech Medics, Inc.
COMBINED INCOME STATEMENT (UNAUDITED)
JANUARY 1, 2006 THROUGH OCTOBER 31, 2006
ORDINARY INCOME & EXPENSE
INCOME $ 408,275
COST OF GOODS SOLD ( 30,025)
GROSS PROFIT $ 378,250
EXPENSES
ADVERTISING $ 4,223
LEGAL & PROFESSIONAL 70,969
RENT & EQUIPMENT LEASES 45,210
MEDICAL CENTER WAGES & EXP 269,962
OFFICERS DEFERRED SALARY 490,000
RESEARCH & DEVELOPMENT 20,500
UNCATEGORIZED EXPENSES 91,574
TOTAL EXPENSES $ 992,438
NET INCOME (OR LOSS) ( 614,138)
19
BioTech Medics, Inc.
Pinksheets: BTMD.PK
Unaudited Balance Sheet
FOR THE CALENDAR YEAR 2005
ASSETS
Cash $ 95,617
Fixed Assets 85,000
Other Assets 3,340,000
TOTAL ASSETS $ 3,520,617
LIABILITIES
Accounts Payable $ 61,035
Current Liabilities 2,305,876
Long Term Liabilities 80,000
TOTAL LIABILITIES $ 2,446,911
EQUITY $ 1,073,706
TOTAL LIABILITIES & EQUITY $ 3,520,617
20
BioTech Medics, Inc., a Nevada corporation (Symbol: BTMD)
(Formerly known as Corbel Holdings, Inc. [ Symbol: CBLH] )
Unaudited Balance Sheet Ending December 7, 2004
ASSETS
Cash $ 0
Buildings & Depreciable Assets $ 460,000
(less accum. Depreciation) $ (29,340) $ 0
$ 430,660
Land (net of amortization) 115,000 $ 0
Intangible Assets (amortizable) $ 4,274
$ (534) $ 0
$ 3,740 -------------------
TOTAL ASSETS $ 549,400 $ 0
LIABILITIES & SHAREHOLDERS EQUITY
Accounts Payable $ 10,500 $ 0
Mortgages, Notes payable in less than 1 yr $ 8,152 $ 0
Loans from Shareholders $ 152,690 $ 0
Mortgages, Notes payable in 1 yr or more $ 397,067 $ 0
Capital Stock (common) $ 29,313 $ 98,013
Additional Paid-in Capital $ 180,116 $ 2,369,917
Retained Earnings $ ( 228,438) $ (2,467,930)
-------------------
TOTAL LIABILITIES & SHAREHOLDERS EQUITY $ 549,400 $ 0
THESE FIGURES WERE PREPARED BY THE CPA FIRM OF
BAGELL, JOSEPHS & CO, LLP, GIBBSBORO, NJ
https://www.otcstockinfo.com/repository/647314/647314_FR3.pdf

[fung_derf]

Shawn Hackman and pump and dumps...

Wednesday, February 25, 2004
Copyright © Las Vegas Review-Journal

JOHN L. SMITH: Fraud scheme case promises to set local legal community on its ear

Shawn Hackman didn't distinguish himself as an attorney in Las Vegas, but for a while he sure excelled as a criminal.

There's a lawyer joke in there somewhere, but the trouble in which Hackman finds himself is anything but humorous.

Hackman, 35, on Thursday pleaded guilty in U.S. District Court to one count of racketeering in a case that promises to turn Southern Nevada's legal community upside down: the 64-count indictment of lawyers linked to what authorities believe is the largest "boxed stock" fraud scheme in local history.

A conservative estimate of the profit from the sale of stock in more than 60 cardboard pump-and-dump companies is $35 million. Sources with knowledge of the setup say that number might represent less than 20 percent of the actual amount separated from investors who believed they were buying freely traded stock.

In exchange for his guilty plea, Hackman has agreed to cooperate fully against the remaining defendants: James Farrell of Sandy, Utah, and attorneys Sean Flanagan and Daniel Chapman of Las Vegas and Herbert Jacobi of New York. Their trial is set for June 15 in U.S. District Judge James Mahan's court.

Hackman, who faces up to 20 years in prison, is in line to receive a downward departure from the federal sentencing guidelines if he provides "substantial assistance," according to his plea agreement.

If Hackman's testimony holds up, it will bolster the government's paper-heavy prosecution against the remaining defendants. The case is being investigated by the Internal Revenue Service's Criminal Investigation unit and the FBI's Organized Crime Squad.

Hackman, after all, was in position to view the operation with his own eyes. And he admits he benefitted illegally from the scheme, which allegedly committed acts of "securities fraud, money laundering, wire fraud, mail fraud, interstate transportation of stolen securities and receipt and sale of stolen securities," according to the plea agreement, which was secured by Assistant U.S. Attorney J. Gregory Damm of the Organized Crime Strike Force.

As part of Hackman's deal, he also admitted he was hired by Las Vegan Peter Berney to "issue false and misleading legal opinions" associated with the fraudulent stocks. Hackman also participated in creating front men as corporate officers and helped set up mergers of the phony shell corporations with private companies.

As a result, he said, investors were led to believe they were purchasing shares in legitimate companies with names like Big Tex Enterprises Inc., Tera West Ventures Inc., Dream Team International Inc., Far East Ventures Inc. and Custom Leathers of Las Vegas Inc., among many.

After the shells merged with private companies, Berney, Las Vegan Robert Potter, and others would dump their shares and reap millions. Potter has subsequently pleaded guilty to money laundering conspiracy.

Although it's clear from the indictment and Hackman's plea agreement that Berney is the central figure in the investigation, his part of the case remains sealed. And for good reason.

This case is arguably the largest "boxed stock" fraud investigation in Southern Nevada history, but it's even bigger than that.

Take Jacobi, for instance. He pleaded guilty in October 2001 to plotting to obtain records stolen from the Las Vegas office of the FBI. Jacobi and Potter received the confidential documents from FBI employee James Hill, who later pleaded guilty. Jacobi paid former FBI agent Michael Levin for documents he believed to be authentic.

"It doesn't take much to figure out who's pulling that information from that computer," Jacobi told Levin.

Trouble for the lawyer was, the double-dealing Levin had already cut his own gig with the government and was wearing a wire.

As if that weren't compelling enough, Potter has been identified as part of a mob-connected pump-and-dump stock scheme in New York. One of Potter's alleged partners was an associate of the Genovese crime family.

It was into the middle of this insanely lucrative and dangerous high-wire world of stock fraud that Shawn Hackman found himself.

It's no wonder he wanted out.

[fung_derf]

More complete CSHD news....

Nov 02, 2006
LAKE DALLAS, TX
MARKET WIRE
Conversion Solutions Holdings Corp. (OTCBB: CSHD), a Delaware Corporation,
announces the following current events have taken place.

SPECIAL MEETING OF MAJORITY SHAREHOLDERS OF THE FRONTHAUL GROUP, INC./CONVERSION
SOLUTIONS HOLDINGS, CORP.

Pursuant to the provisions of Delaware Business Corporation Act, as amended, the
undersigned directors, being a majority of the shareholders of The Fronthaul
Group, Inc./Conversion Solutions Holdings, Corp., a Delaware corporation (the
"Company"), acting by written consent, hereby adopt the following corporation
shareholder resolutions and hereby consent to the taking of the actions set
forth therein.

WHEREAS, shareholders owning a 51+% majority of the 159,000,000 outstanding
shares of the Company as evidenced by the signatures to these shareholder
minutes have determined it is in the best interest of the Company for a new set
of directors be appointed to take control of the Company in lieu of the present
board and managements violating certain provisions of the Merger Agreement
including, but not exclusive of, Sections 2, 4 and 6, which have caused the
Company to be subjected to investigations by the Securities and
Exchange Commission for filing erroneous financial statements,
publishing questionable press releases, the NASD's halting of trading in
the Company's shares, and not filing proper documents and amendments with the
Delaware Secretary of State.

WHEREAS, Michael A. Alexander has offered to return to the Company as its
Chairman of Board and Chief Executive Officer to oversee the restructuring and
operations of the Company.

WHEREAS, Randy Moseley has offered to return to the Company as its Chief
Financial Officer to assist Mr. Alexander's in the restructuring and manage the
financial aspects of the Company.

RESOLVED, that Michael A. Alexander be appointed as the Company's sole director
in replacement of Rufus Harris and Darryl Horton, the current directors of
record with the Delaware Secretary of State and any other directors that might
have been appointed and not reported to the Delaware Secretary of State.

RESOLVED FURTHER, that Michael A. Alexander be appointed as the Company's Chief
Executive Officer and President the Company.

RESOLVED FURTHER, that Randy Moseley become the Company's Chief Financial
Officer upon the resignation or termination of Darryl Horton.

RESOLVED FURTHER, Michael Alexander and other management personnel appointed by
Mr. Alexander as sole director be authorize to establish corporate bank
relations and accounts for the Company.

RESOLVED FURTHER, that Michael Alexander be authorized to establish the
corporate offices for the Company in a location that he deems appropriate and
accumulate and secure all the Company's financial records at the selected
location.

RESOLVED FURTHER, that the Company file an amended Annual 10-KSB and the
September 30, 2006 Quarterly 10-QSB with the Securities and Exchange Commission
as soon as possible.

RESOLVED FURTHER, that the Company terminate all existing employment agreements
and authorizes the new board of directors to negotiate employment agreements
with new management as deemed necessary.

RESOLVED FURTHER, that Michael Alexander, as sole director, be authorized to
cancel shares of common stock issued to the replaced board of directors and
management as he deems equitable.

The execution of this Consent, which may be accomplished in counterparts, shall
constitute a written waiver of any notice required by the Nevada Business
Corporation Act or this corporation's Articles of Incorporation and Bylaws.

Dated: November 2, 2006.

"Based on current events, the major shareholders have approached me and asked me
to return to the company as the Chairman of the Board and Chief Executive
Officer. I have chosen to resume this role as my shareholders best interest,
have always been foremost in my mind. I personally feel this is the right move
at this time. I ask every shareholder only read and except information which
will come from me in this time of transition. We do not intend to change the
business model or management at this time. I will be diligent in updating the
shareholders during this process. I spoke directly with Rufus Paul Harris prior
to the majority shareholder meeting and have his 100% support. I regret his
hasty departure from the company, as I feel every person is innocent until
proven guilty. I look forward to working with the SEC, Ben Stanley, and Sabra
Dabbs in moving this company in the right direction and resolving current
issues. Any questions please feel free to contact the company at (940)
321-1074," says Michael Alexander Chairman/CEO Conversion Solutions
Holdings Corp.



Contact: Michael Alexander [phone]



SOURCE: Conversion Solutions Holdings, Corp.

[fung_derf]

and then Rufus was gone....

KENNESAW, Ga., Nov 02, 2006 /PRNewswire-FirstCall via COMTEX/ -- Conversion
Solutions Holdings Corp (OTC Bulletin Board: CSHD), a Delaware Corporation
announces the following current events have taken place.

On November 1, 2006 Conversion Solutions Holdings Corp Board of Directors has
voted and agreed to remove Mr. Rufus Paul Harris as Chief Executive Officer due
to pending litigation to protect the company and shareholders at this time.
Conversion Solutions will announce succeeding Chief Executive Officer at a later
date.

About Conversion Solutions Holdings Corp

CSHD is a diversified holdings corporation, which was formed to originate, fund
and source funding for asset-based transactions in the private market. CSHD's
main service will be to acquire, fund and provide insurance to target companies
in the currently underserved $15,000,000 to $100,000,000 asset finance market.
Our funding will enable our businesses to compete more effectively, improve
operations and increase value. CSHD is headquartered in Kennesaw, Georgia, a
suburb of Atlanta. For more information, please visit us at http://www.cvsu.us/.

SOURCE Conversion Solutions Holdings Corp


CONTACT: Ben F. Stanley, COO, [phone], [e-mail], or
Sabra Dabbs,
[phone] or [phone], [e-mail]

URL: http://www.cvsu.us/
http://www.prnewswire.com
www.prnewswire.com

Copyright (C) 2006 PR Newswire. All rights reserved

[fung_derf]

The first words from Kevin West. CEO of CMKX......

Here is a repost from RB
By: Kevin M. West

The Los Angeles office of the SEC is taking CMKX (CMKM Diamonds) to an Administrative hearing on May 10th to try and revoke their listing as a public company. We know they want to revoke CMKX as evidenced by the Disposition of Summary that the SEC asked for in the phone conference held last week between the Administrative Judge and attorneys involved in this case.

In the story of a mining and exploration company from Las Vegas, Nevada, it appears that the SEC is either taking some unjustifiable sort of revenge, protecting the rich of Wall Street from a destructive blow or the company is a complete fraud that has been allowed to sell hundreds of billions of shares to investors. It will be up to you to decide and, in a moment, we will lay out the time table of events that have put CMKM Diamonds in this predicament, but let s first try to reason as to what is really going on here.

CMKM Diamonds is a diamond exploration and mining company based out of Las Vegas, Nevada. The company owns 951,968.54 acres (385,248 hectares) of mineral rights consisting of 1,038 separate claims in the mineral rich territory of Saskatchewan, Canada. The adjacent and surrounding claims of DeBeers that have boasted tens of billion of dollars in valuation on around 58,000 acres or about 1/16th the total size of the land mass of known mineral rights belonging to CMKX. The company also owns at least one gold mine (the American Gold Mine) in Ecuador and mineral claims (and possible mines) with zinc, uranium among other minerals in Canada and elsewhere.

With all the apparent valuation of CMKX, why would the SEC take to stripping money from tens of thousands of investors, rather than just help this company get back on it s feet and make money for it s investors like it has been trying too? If the company is revoked, the shares become worthless in the market. If the company continues and becomes fully reporting again, the investors may become very wealthy due to the company s potential valuation.

Also, as listed in one ongoing count of very concerned investors, why is there over 87 billion shares held by less than 1,000 shareholders when it is rumored that there are as many as 40,000-72,000 CMXK shareholders and only 800 billion shares authorized? It would appear we have not billions, but trillions of shares on the market. Could the company have put them there, it s not even possible. Are they counterfeit shares? They would HAVE to be! Who would be responsible for that you ask, it would be the market place along with NON-Regulation by the SEC.

This January, the SEC enacted Regulation SHO to put an end to the counterfeit shares (also called Naked Short Shares) being transacted into the market. However, the SEC grandfathered in all of the felonious crimes of counterfeiting shares previous to the day Regulation SHO was enacted. WHY?

Now let s get back to the story of CMKM Diamonds and how all this talk of counterfeited shares possibly relates to the reason the SEC wants them gone.

(*1)On July 22, 2003, upon the advice of counsel, a Form 15 pursuant to Rule 12g-4(a)(1)(i) was filed as certification and notice of termination of registration under Section 12(j) of the Act, stating that at the time of filing the Form 15 CMKX had approximately 300 stockholders of record.

(*2)On June 4, 2004, the Company retained the services of Roger Glenn, Esq. from the New York law firm Edwards & Angel LLP to assist in preparing the required SEC reports.

The Company continued its efforts to bring its filings up to date by engaging Neil Levine, of the Firm of Bagell, Josephs & Company, LLC, as independent auditor.

In July of 2004, Mr. Casavant suffered a stroke which left him with no alternative but to rely upon the professionals he had retained to oversee the Company operations.

(*3)During the 3rd or 4th quarter of 2004, the Enforcement Division launched an investigation in the Matter of U.S. Canadian Minerals, Inc. LA-2937. Under the umbrella of the LA-2937 investigation, the Enforcement Division caused the issuance of subpoenas, deposed and interrogated CMKM Diamonds consultants and management. inclusive of the Company s new auditor, the Company s financial consultant, and Edwards & Angel LLP. In addition, a subpoena was issued directly to CMKM Diamonds, where under the Company supplied significant information to the Commission, including substantial information regarding the Company s mining claims.

(*4)CMKX appointed Mr. Robert Maheu to the Board of Directors in order to oversee the necessary regulatory requirements. Bob Maheu is not just any co-CEO, Mr. Maheu was the main man Howard Hughes used to run the mob out of Las Vegas among a huge list of many other outstanding achievements . He has never lost a regulatory battle. Mr. Maheu, on behalf of the Company, immediately retained the service of Stoecklein Law Group on February 7, 2005 for the primary purpose of coordinating the preparation of all reports due under the Act for the respective missing periods. Upon its initial due diligence of the Company, Stoecklein Law Group realized that at the time of filing the initial Form 15. The Company had 698 stockholders of record and that the filing of a Form 15 was not available to the Company as of July of 2003.

Upon its initial due diligence of the Company, Stoecklein Law Group realized that at the time of filing the initial Form 15. The Company had 698 stockholders of record and that the filing of a Form 15 was not available to the Company as of July of 2003.

(*5)On February 17, 2005, Stoecklein Law Group advised the Company to file a Form 15/A which resulted in the Company being subject to the reporting requirements of Section 12(g) of the Act.

During March 2005 a financial consulting firm was retained to assist the Company in its financial statements and logistical coordination was commenced between management, the financial consulting firm, the audit firm, Stoecklein Law Group, and the transfer agent.

(*6)The Company believes that as a result of the Enforcement Division investigation in LA-2937, the Enforcement Division caused the issuance of a temporary trading suspension on March 3, 2005 and the issuance of the Order Instituting Administrative Proceeding on March 16, 2005. While the actions by the Enforcement Division are designed to be remedial, they may in fact be causing a punitive effect on the Company s stockholders by further perpetuating a growing naked short (counterfeit shares) position in the Company s stock, as alleged by numerous stockholders.

OK, now one might ask why would the SEC not want to help this company get back on its feet and produce a valuation that would make its shareholder base happy and their investment portfolios grow? It is obvious that CMKX is not a fraud, but possibly a victim of poor past management because those involved didn t know how to run a public company. Is this a crime? No it s not a crime, and co-CEO and original founder of CMKX, Urban Casavant is an extremely good man with a heart of gold. This world could use many more men like him, in this writer s opinion!

Is it better to PUNISH CURRENT INVESTORS, strip away 100% of their investments perhaps destroying the savings and college funds of thousands of American families than to fine the company and take a hands-on approach into getting them current in their filings?

Let s look at what could possibly happen if there are even just 800 billion naked short shares on this stock, and not trillions as is suspected. DeBeers has already boasted a conservative 40-80 billion dollar valuation on approximately 58,000 acres. Using 1/10th the lowest possible valuation (for safety) of $40 Billion, or $4 Billion on 58,000 acres and CMKX owning 16 times the land mass, the math would look like this.

$4 Billion x 16 = $64 Billion valuation (at only 1/10th lowest possible DeBeers valuation)

$64 Billion divided by 800 Billion shares = .08 per share (worst possible scenario)

800 Billion counterfeit shares x .08 per share = $64, 000,000,000 (Billion) owed to share holders by the market place! (Keep in mind, the current trading price of CMKX is less than 1/100th of a penny per share). Now multiply that by a possible 10-20 times the valuation and 2-3 times the number of counterfeit shares and there is some SERIOUS trouble involved here!

What could be done to solve this problem, reward long enduring shareholders, let the company focus on its mining and exploration programs and save the market from a messy situation at the same time?

The SEC could do its job and PROTECT shareholders, first off. Tens of thousands of CMKX shareholders are NOT going to stand by and let the SEC use that old line that they are looking out for the potential new investors of this stock . That s garbage and all CMKX investors and the SEC know it is! Those responsible for creating and helping this fraud to perpetuate (possible violators include but are not limited to the DTCC, Brokers, Market Makers and Hedge Funds) need to come to the table and make an offer to all shareholders and the criminals responsible for this unjustifiable crime need to go to jail.

America needs to know; What is the SEC going to do to protect the CURRENT shareholders that have millions and millions of dollars invested in CMKX?

Stand up America , and TAKE YOUR COUNTRY BACK!

Sincerely,

Kevin M. West

[fung_derf]

OT: Conversion Solutions and CEO in very hot water

2006-10-25 20:26 ET - Street Wire

Also Street Wire (U-*SEC) U.S. Securities and Exchange Commission

by Lee M. Webb

Conversion Solutions Holdings Corp. and its semi-literate chief executive officer, Rufus Paul Harris, are being sued for fraud by the U.S. Securities and Exchange Commission (SEC). Among other things, the U.S. regulator alleges that Conversion's fantastic claims about owning billions of dollars worth of bonds are bogus.

The SEC, which finally issued a 10-day trading suspension against Conversion on Oct. 24, filed a complaint for injunctive and other relief in the U.S. District Court for the Northern District of Georgia on the same day.

As previously reported by Stockwatch, Conversion claims to have an asset portfolio of approximately $7.3-billion consisting primarily of bonds and an estimated book value of $70.71 per share.

According to the SEC allegations, however, Conversion's claims with respect to approximately $6.8-billion worth of its purported bond holdings are rubbish.

Mr. Harris and Conversion have not yet filed a response to the SEC complaint and the allegations have not yet been proven.

The complaint

According to the U.S. regulator, beginning on Sept. 26, Conversion and Mr. Harris made a series of false or misleading statements through news releases and SEC filings.

"These false statements dramatically inflated both the price and trading volume for Conversion's shares," the regulator claims.

"In September and October 2006, Conversion issued a series of press releases, and filed with the Commission a current report and an amended current report on Form 8-K and 8-K/A, respectively, an annual report on Form 10-KSB and two amended annual reports on Forms 10-KSB/A, all of which fraudulently overstated Conversion's assets," the SEC goes on to allege.

In its complaint, the U.S. regulator takes particular aim at the OTC Bulletin Board promotion's allegedly false claims with respect to approximately $6.8-billion worth of Republic of Venezuela bonds.

According to the SEC, in a Sept. 26 Form 8-K filed by Conversion and a subsequent Sept. 27 news release, the company falsely claimed to have acquired euro-denominated bonds on the Republic of Venezuela with a converted value of approximately $6.3-billion.

The U.S. regulator says that the identifying codes for the bonds provided by Conversion correspond to a much smaller euro-denominated bond series issued by Venezuela. Indeed, the bond series under the identifiers provided by the OTC-BB promotion carry a converted value of approximately $882-million.

Moreover, the SEC claims that Conversion "does not own, or manage as an asset," the entire Venezuelan bond series corresponding to the identifying codes listed in the Sept. 26 Form 8-K or Sept. 27 news release.

The U.S. regulator also alleges that claims in Conversion's Sept. 29 Form 8-K/A and attached audited financial statements regarding the company having full ownership of another $500-million worth of Venezuelan bonds are also false.

"Some, and possibly all, of the $500-million Venezuelan bond issue was owned by entities other than Conversion during the relevant time period," the SEC claims.

In a supporting declaration, SEC accountant David W. Elzinga claims that he could not find any indication "that Conversion owned, wholly or partially, the $500-million Venezuelan bond issue."

The SEC further alleges that, in a Sept. 27 press release, Conversion falsely claimed to have a contract with Deutsche Bank in connection with some vaunted "banking platform" for global, sovereign and institutional investors.

"On information and belief, Deutsche Bank does not have any contract with Conversion, with the possible exception of an ordinary bank account relationship," the SEC claims.

In a supporting declaration, Deutsche Bank lawyer David M. Levine claims that after "a best efforts search of relevant pockets within Deutsche Bank, we have been unable to confirm the existence of any contract with Conversion Solutions."

Mr. Levine says that he contacted Mr. Harris on Sept. 28 to ask him about the contract Conversion had purportedly signed with Deutsche Bank.

"Mr. Harris stated that the contract was related to the Euroclear Platform and had been facilitated by an ambassador with the United Nations Education and Social Program," Mr. Levine states. "He would not provide the name of his Deutsche Bank contact."

The Deutsche Bank lawyer goes on to say that he called Mr. Harris twice on Sept 29 and, on the same day, made two calls to Conversion's chief operating officer Ben Stanley and another call to executive vice-president John Walsh, leaving detailed voicemail messages each time. Mr. Levine says that none of the Conversion executives called him back.

According to the SEC complaint, Conversion's false statements inflated the company's share price and trading volume after the two Sept. 27 press releases were issued.

The regulator notes that with 498,303 shares changing hands, Conversion closed at $1.01 on Sept. 26, the day before the allegedly fraudulent news releases.

On Sept. 27, the volume jumped to more than 4.9 million shares and the stock closed at $1.75.

"The effect of the fraudulent releases continued into Thursday, September 28, when Conversion's stock closed at $3.02 per share on a volume of 14,037,728 shares traded," the regulator says. "The price and volume have remained above the September 26 levels through the date of this complaint."

The U.S. regulator claims that Conversion and Mr. Harris "knowingly, intentionally and/or recklessly" committed fraud.

Further, the SEC says that Conversion violated reporting requirements and Mr. Harris aided and abetted the company's reporting violations.

Moreover, the SEC alleges that Mr. Harris signed certifications that contained untrue statements of material fact.

The SEC wants the Georgia court to issue a temporary restraining order and preliminary and permanent injunctions enjoining Mr. Harris and Conversion from violating federal securities laws.

The regulator is also asking for an order requiring disgorgement of all ill-gotten gains and an order imposing civil penalties against the defendants.

In addition, the SEC is seeking an order expediting discovery and preserving the documents of the defendants.

The regulator also wants an order permanently banning Mr. Harris from acting as an officer or director of any public company.

The emergency application

Along with the 15-page Oct. 24 complaint, the SEC also filed a 16-page memorandum of law in support of its emergency application for a temporary restraining order and other relief.

"From at least late September 2006 through October 19, 2006, Conversion Solutions Holding Corporation a/k/a Conversion Solutions Inc. ... has made a series of false or misleading statements through press releases and filings with the U.S. Securities and Exchange Commission," the SEC claims in its preliminary statement.

Once again keying on the allegedly bogus claims regarding the Venezuelan bonds, the regulator says that the false statements made by Mr. Harris and Conversion boosted the company's share price and trading volume.

"To date, neither Conversion nor Harris has done anything to correct these statements," the regulator says.

"When asked to provide copies of apparently fictitious contracts referred to in one Conversion press release, a Conversion officer stated that a 'gag order from the U.N. ambassador' prohibited him from doing so," the SEC adds.

The memorandum goes on to provide the SEC's account of the facts relating to the allegedly fraudulent bond claims and fictitious Deutsche Bank contract in more detail and with far less legalese than the complaint.

Turning to the legal argument, the U.S. regulator says that the defendants misrepresented and omitted material facts.

"Conversion and Harris have claimed falsely that Conversion has billions of dollars worth of assets," the SEC claims.

The regulator goes on to say that the sharp increase in the trading activity and stock price after the fraudulent Sept. 27 news releases "reflects the materiality of the false and misleading information that was provided to the market."

According to the SEC the defendants acted with "scienter," which may be shown by "severe recklessness."

"The repeated and outlandish nature of the misleading statements by Conversion and Harris shows recklessness, if not outright knowledge of the falsity of their claims," the SEC states. "Harris controls Conversion. Accordingly, his scienter is imputed to it."

The memorandum goes on to claim that Conversion violated its reporting requirements and Mr. Harris aided and abetted those violations "by knowingly recording fictitious assets on the company's financial statements, and by otherwise describing fictitious assets in those reports."

"As discussed above, Conversion and Harris are engaged in what appears to be an accelerating pattern of flagrant securities laws violations that has been going on since at least late September 2006," the SEC says in support of its application.

"Absent a temporary restraining order and preliminary injunction, it appears that the defendants will continue to violate the federal securities laws," the regulator adds.

The SEC wants the court to issue an order preventing the alteration, destruction or concealment of any relevant Conversion documents.

The regulator also wants an order expediting discovery.

"Expedited discovery of matters concerning the defendant's activities will permit the Commission to determine whether investors' assets are at risk," the SEC says after alleging that Conversion's claims about having billions of dollars worth of assets are false.

About the dates

Interestingly, at least from the lay perspective of this reporter, the SEC seems to be at pains to peg Sept. 26 as the date of the onset of the allegedly fraudulent activity.

As previously reported by Stockwatch, however, Conversion's grey sheet predecessor, Conversion Solutions Inc. (CVSU), was touting its purported ownership of $500-million worth of Venezuelan bonds as early as April 27.

According to the declaration of SEC accountant Mr. Elzinga, he accessed information from Bloomberg and noted trading activity in that $500-million bond issue from March 15 right through to Oct. 23.

"Based upon my experience, it is unlikely that any trading would occur if the bond issuance were owned by a single investor," Mr. Elzinga declares, going on to add that he could find no indication that Conversion owned any of the $500-billion bond issuance.

If the SEC's allegations and the supporting declaration of Mr. Elzinga are true, then Conversion's claim about owning the bonds was as bogus in April as it is now.

Moreover, while the SEC harps on Sept. 26 in its complaint and emergency application for a restraining order, Mr. Elzinga's declaration addresses, and even includes as exhibits, apparently fraudulent press releases issued on Aug. 18 and Aug. 23.

As previously reported by Stockwatch, on Aug. 18 the company issued a news release announcing that it had acquired a euro-denominated Lehman Brothers Holdings PLC bond with a converted value of approximately $579-million.

Mr. Elzinga identified that bond issue on Bloomberg and noted that many different entities, none of which appeared to be Conversion, owned portions of that bond. Mr. Elzinga goes on to declare that he could find no indication that Conversion owned any of the Lehman bond issue.

Again as previously reported by Stockwatch, on Aug. 23 Conversion issued a news release announcing it had acquired a euro-denominated bond on the Republic of Finland with a converted value of approximately $939-million.

Once again, Mr. Elzinga declares that there was no indication that Conversion owned any of that bond issue.

Oddly, the SEC complaint, keying on Sept. 26, makes no specific mention of Conversion's apparently bogus August claims regarding the Lehman Brothers and Republic of Finland bonds.

In any event, it is clear from the declaration of the SEC's Atlanta enforcement branch chief Michael E. Mashburn that the regulator was nosing around Conversion and being met with bobbing and weaving long before Sept. 26.

The Mashburn declaration

According to Mr. Mashburn, the SEC sent a letter to Mr. Harris requesting the production of documents on Aug. 22, more than a month before the Sept. 26 date the U.S. regulator seems to want to hold out as marking the start of the dastardly deeds.

In response to the Aug. 22 letter and a couple of telephone messages from Mr. Mashburn, Mr. Harris finally called the Atlanta enforcement chief on Sept. 5.

Mr. Mashburn says that he asked Mr. Harris about the Aug. 18 and Aug. 23 news releases and the claims about agreements with the Humanitarian & Scientific World Foundation relating to the Lehman Brothers and Republic of Finland bonds.

"Harris told me that Sabra Dabbs of Conversion Solutions arranged a meeting with representatives of the Foundation through the staff of Rudolph Giuliani," Mr. Mashburn says. "He said that the Foundation gave 'codes' to Conversion Solutions to be put into the 'banking system.'

"The company will then use the funds to finance activities by its subsidiaries."

According to Mr. Mashburn, Conversion's leader told him that the company had 14 subsidiaries.

"Harris described these as mostly failed companies that nonetheless had good ideas," Mr. Mashburn reports. "He said that a meeting was scheduled for the following day with Conversion Solutions' representative in Europe and a UNESCO ambassador in order to bring in additional subsidiaries."

Mr. Mashburn says that Mr. Harris explained that "in return for the codes for the bonds" Conversion promised the Humanitarian & Scientific World Foundation 50 per cent of the profits from the ventures with the subsidiaries.

As an example of a possible deal, Mr. Harris told the SEC enforcement officer that Conversion "might arrange a deal with the Atlanta Symphony, which needs $100-million."

According to Mr. Mashburn, Conversion's chief executive officer said that none of the deals with its subsidiaries has been accomplished yet.

"Harris asserted that the bonds had to be real because they had codes," Mr. Mashburn says further into his declaration. "He described the system as one where they can go on-screen, enter the codes and then have their bankers draw down on the funds. They have not executed any of the codes yet."

"I asked Harris if he planned to send any documents to the staff as requested," Mr. Mashburn later says. "He stated that he did not keep documents and that Forms 8-K filed earlier contained all the documents describing the merger and the bonds.

"Harris said he would send a letter to the staff stating that he has none of the information requested and supplying a list of the banks with which Conversion Solutions had arrangements."

According to Mr. Mashburn, Mr. Harris never sent the promised letter.

"I asked Harris if he made a guarantee that Conversion Solutions' stock would trade at $15 per share," the SEC enforcement officer says. "He replied that he had stated that the stock would 'reset' at this price after the merger with FrontHaul, but that he had not said that it would climb to this amount."

Mr. Mashburn reports that following his Sept. 5 telephone conversation with Conversion's chief executive officer, the SEC sent Mr. Harris a letter on Sept. 7 "scheduling his voluntary testimony in this matter" for Sept. 20.

"Harris did not appear," Mr. Mashburn notes.

The SEC's Atlanta branch chief says that he called Mr. Harris again on Sept. 29 to ask him about the Sept. 27 news release announcing the company's purported contracts with four banks, including Deutsche Bank.

Mr. Mashburn says that Mr. Harris agreed to fax a copy of the Deutsche Bank contract to him that very afternoon and to visit the Atlanta SEC office for an interview on Oct. 5.

Shortly after his Sept. 29 chat with Mr. Harris, the SEC enforcement officer says that he received a call from Conversion's chief operating officer, Mr. Stanley.

"Stanley said he had been asked by Harris to call me," Mr. Mashburn says. "He further stated that he could not fax copies of the Deutsche Bank contract to me because they were under a 'gag order from the UN ambassador' and did not wish to reveal the identity of their trader in Europe."

According to Mr. Mashburn's declaration, Mr. Stanley agreed to come to the Atlanta SEC office for an interview on Oct. 4, but a few hours before the scheduled meeting, Mr. Stanley called to say that he could not make it.

"During our conversation, Stanley said that there was no need to provide copies of the contracts to us as Conversion Solutions had filed copies of them at the courthouse in Bartow County, Georgia," Mr. Mashburn reports in his declaration, which is dated Oct. 6.

So, after getting the run-around for a couple of months, listening to some rather dubious stories and thin excuses and reviewing the allegedly bogus claims regarding billions of dollars worth of bonds, the SEC finally issued a 10-day trading suspension against Conversion on Oct. 24 and followed up with a civil suit on the same day.

Conversion last traded on Oct. 23 when the stock closed at $1.99.

Stockwatch will continue to follow developments.

Comments regarding this article may be sent to [e-mail].

[fung_derf]

Seems CSHD and Rufus are headed for the courthouse...

Defendant Rufus Paul Harris also known as Paul Rufus Harris

U.S. District Court
Northern District of Georgia (Atlanta)

CIVIL DOCKET FOR CASE #: 1:06-cv-02568-CC

Securities and Exchange Commission v. Conversion Solutions Holding Corporation et al
Assigned to: Judge Clarence Cooper
Cause: 15:78m(a) Securities Exchange Act
Date Filed: 10/24/2006
Jury Demand: None

Nature of Suit: 850 Securities/Commodities

Jurisdiction: U.S. Government Plaintiff
Plaintiff
Securities and Exchange Commission
represented by Alana R. Black
Securities & Exchange Commission
3475 Lenox Road, N.E.
Suite 1000
Atlanta, GA 30326-1232
404-842-7678
Email: [e-mail]
LEAD ATTORNEY
ATTORNEY TO BE NOTICED

Debbie T. Hampton
Securities & Exchange Commission
3475 Lenox Road, N.E.
Suite 1000
Atlanta, GA 30326-1232
404-842-7635
LEAD ATTORNEY
ATTORNEY TO BE NOTICED

William P. Hicks
Securities & Exchange Commission
3475 Lenox Road, N.E.
Suite 1000
Atlanta, GA 30326-1232
404-842-7675 Direct
Email: [e-mail]
LEAD ATTORNEY
ATTORNEY TO BE NOTICED


V.
Defendant
Conversion Solutions Holding Corporation

Defendant
Rufus Paul Harris
also known as
Paul Rufus Harris


Date Filed # Docket Text
10/24/2006 3 CERTIFICATE by Plaintiff pursuant to Rule 65(b) FRCP re 2 MOTION for Temporary Restraining Order, MOTION for Preliminary Injunction by Securities and Exchange Commission (vs) (Entered: 10/24/2006)

10/24/2006 2 MOTION for Temporary Restraining Order, MOTION for Preliminary Injunction by Securities and Exchange Commission. (Attachments: # 1 Memorandum of Law in support# 2 Text of Proposed Order)(vs) (Entered: 10/24/2006)

10/24/2006 1 COMPLAINT filed and summon(s) issued. Consent form to proceed before U.S. Magistrate and pretrial instructions provided. , filed by Securities and Exchange Commission.

(Attachments: # 1 Summons # 2 Civil Cover Sheet # 3 Exhibit Index Exh. 1# 4 Exhibit 1A# 5 Exhibit 1B# 6 Exhibit 1C# 7 Exhibit 1D# 8 Exhibit 1E # 9 Exhibit 1F# 10 Exhibit 1G part 1# 11 Exhibit 1G part 2# 12 Exhibit 1G part 3# 13 Exhibit 1G part 4# 14 Exhibit 1H part 1# 15 Exhibit 1H part 2# 16 Exhibit 1H part 3# 17 Exhibit H part 4# 18 Exhibit 1 I part 1# 19 Exhibit 1 I part 2# 20 Exhibit 1 I part 3# 21 Exhibit 1 I part 4# 22 Exhibit 1 I part 5# 23 Exhibit 1 I part 6# 24 Exhibit 1J# 25 Exhibit 1K# 26 Exhibit 1 L# 27 Exhibit 1M# 28 Exhibit 1N# 29 Exhibit 1O# 30 Exhibit 1P# 31 Exhibit 1Q# 32 Exhibit 2# 33 Exhibit 3# 34 Exhibit 4# 35 Index of Exhibits)(vs)

[fung_derf]

CSHD halted.......

CHSD Suspension: The SEC statement:

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
SECURITIES EXCHANGE ACT OF 1934
RELEASE NO. 54645 / October 24, 2006

The Securities and Exchange Commission announced the temporary suspension, pursuant
to Section 12(k) of the Securities Exchange Act of 1934 (the "Exchange Act"), of trading
of the securities of Conversion Solutions Holdings Corp. ("Conversion"), of Kennesaw,
Georgia at 9:30 a.m. EDT on October 24, 2006, and terminating at 11:59 p.m. EST on
November 6, 2006. Conversion’s stock trades in the over-the-counter market under the
symbol “CSHD”.

The Commission temporarily suspended trading in the securities of Conversion because
of questions that have been raised about the accuracy and adequacy of press releases and
public filings with the Commission concerning, among other things, the company’s
purported ownership and control of two bond issuances, in the face amounts of €5 billion
and $500 million, issued by the Republic of Venezuela, and the company’s purported
contractual relationship with Deutsche Bank.

The Commission cautions brokers, dealers, shareholders, and prospective purchasers that
they should carefully consider the foregoing information along with all other currently
available information and any information subsequently issued by the company.
Further, brokers and dealers should be alert to the fact that, pursuant to Rule 15c2-11
under the Exchange Act, at the termination of the trading suspension, no quotation may
be entered unless and until they have strictly complied with all of the provisions of the
rule. If any broker or dealer has any questions as to whether or not he has complied with
the rule, he should not enter any quotation but immediately contact the staff in the
Division of Market Regulation, Office of Interpretation and Guidance, at [phone].

If any broker or dealer is uncertain as to what is required by Rule 15c2-11, he should
refrain from entering quotations relating to Conversion’s securities until such time as he
has familiarized himself with the rule and is certain that all of its provisions have been
met. If any broker or dealer enters any quotation which is in violation of the rule, the
Commission will consider the need for prompt enforcement action.
If any broker, dealer or other person has any information which may relate to this matter,
the Atlanta District Office of the Securities and Exchange Commission should be
telephoned at [phone].

[fung_derf]

Rufus's letter to the shareholders about the evil of IHub...

http://www.investorshub.com/boards/read_msg.asp?message_id=14144058

http://www.waatle.com/1482871.html

[fung_derf]

Conversion Solutions tweaks filing, swipes at bashers


2006-10-20 11:16 ET - Street Wire

by Lee M. Webb

Conversion Solutions Holdings Corp., a virtually penniless OTC Bulletin Board promotion, has tweaked its recently filed creative annual report with yet another amendment. Meanwhile, Rufus Paul Harris, the semi-literate chief executive officer of the purported multibillion-dollar company, is taking comical swipes at so-called "bashers."

As previously reported by Stockwatch, Conversion Solutions, the product of a recent merger between a grey sheet outfit and The FrontHaul Group Inc., an OTC-BB company, belatedly filed its creative, if deficient, cut-and-paste annual report on Oct. 16.

Within a few hours of filing the report, the company filed an amendment to the Form 10-KSB to clear up some confusion regarding the record date for a proposed forward split or dividend or, as Mr. Harris insists, reset issuance that will see the company cut another 618.8 million shares, if the cockamamie scheme proceeds.

The amended filing did not clear up any of the more serious issues, such as the complete absence of any financial information regarding the company's OTC-BB predecessor, FrontHaul.

Notwithstanding the glaring omissions, inconsistencies and notable sloppiness of Mr. Harris's cut-and-paste creation, the company's cult-like followers were in a tizzy over the filing and a subsequent fluffy news release claiming the company has approximately $7.3-billion in assets and a book value of $70.71 per share. (All amounts are in U.S. dollars.)

Given that the stock is struggling below $2 per share, it is clear that the market does not lend much credence to Mr. Harris's claims.

In any event, with the belated filing and a subsequent amendment submitted, the company's cult-like followers delightedly exclaimed that the "E" appended to the trading symbol flagging Conversion Solutions as delinquent would be removed.

As it turned out, while the U.S. Securities and Exchange Commission (SEC) seems oblivious to the promotion, at least as far as anyone can tell, the Nasdaq Stock Market, which oversees the OTC-BB, found at least some fault with the annual report.

Specifically, Nasdaq recognized that the sloppy cut-and-paste annual report did not include the required auditor's opinion letter. Consequently, the "E" remained appended to the company's stock symbol.

Conversion Solutions filed another amended 10-KSB on Oct. 19 to include the Sept. 28, 2006, opinion letter of accountant Thomas Benson. It is simply a copy of the letter that Mr. Benson signed when he audited the unimpressive financial statements of the grey sheet precursor to Conversion Solutions a few weeks ago.

It remains to be seen whether, in the absence of any apparent interest from the SEC, that letter will satisfy Nasdaq that Conversion Solutions has met its filing requirements.

The letter

Meanwhile, Mr. Harris, the grand pooh-bah of this purported multibillion-dollar promotion is warning Conversion Solutions shareholders to avoid a popular Internet stock chat site, InvestorsHub.com.

Mr. Harris and several of his fellow executives post to Internet chat sites, with HotStockMarket.com being the clear favourite. HotStockMarket.com is home to the company's most devoted cult-like followers, who brook no criticism of Conversion Solutions.

On InvestorsHub, however, the discussion is more freewheeling, though cheerleaders still outnumber the company's critics.

In any case, according to a letter addressed to "All Real shareholders" with the subject line "Professionalism," Mr. Harris thinks that all "real" shareholders of Conversion Solutions should stay away from InvestorsHub.

"It is my recommendation for any longs or real shareholder (sic) to reframe (sic) from reading or posting on Investors Hub," Mr. Harris says in the Oct. 19 letter.

"Investors Hub is a festering pool of frauds and bashers with alternate motives; and it is not friendly to any company," Mr. Harris continues.

"The owner and operators of this site will delete true statements from the CEO and leave false statements from convicted frauds and lies for all to read," the grand-poobah declares.

"If you continue to read Investors Hub do so at your own risk, please reframe (sic) from calling or sending any information post on IHUB to the corporations (sic) Officers," says Mr. Harris.

"This response is posted due to numinous (sic) calls and emails about IHUB fraudulent post," the chief executive officer claims.

"The above statements are fact and not my Opinion," Mr. Harris states.

"Again, it is my recommendation for any longs or real shareholder to reframe (sic) from reading or posting on Investors Hub due the activity of It Owner and operators," he advises again.

"If you choose to continue reading IHUB and want to report fraudulent posting please do so at [e-mail]," Mr. Harris says after complaining about the "numinous" e-mails and asking investors to "reframe" from sending any information about posts to the company.

"At the appropriate time the corporation will seek by federal order from IHUB owners the IP addresses and registration information of IHUB posters," Mr. Harris declares before signing off with "GODSPEED."

It should be noted that English is not Mr. Harris's second language.

This assault on the "bashers" who post on Investors Hub delights the company's gullible cult-like followers who post on HotStockMarket.com, but Mr. Harris and his admirers may find that threatening legal action may simply draw more critical posters.

In any event, "longs and real shareholders" should be hoping that Mr. Harris's numeracy is more than a cut or two above his literacy.

Meanwhile, with the "E" still appended to its trading symbol, Conversion Solutions traded as low as $1.49 per share before rebounding after the filing of the latest amendment to the annual report to close at $1.85 on Oct. 19.

Stockwatch will continue to follow developments.

Comments regarding this article may be sent to [e-mail].

(More information regarding Conversion Solutions Holdings Corp. is available in Stockwatch articles published on Oct. 13, 16 and 18, 2006.)




http://new.stockwatch.com/swnet/newsit/newsit_newsit.aspx?bid=U-s0123221-U:CSHD-20061020&symbol=...

[fung_derf]

Stockwatch report of 10/4/06....


CMKM Diamonds makes the big time in NYT article


2006-10-04 10:55 ET - Street Wire

by Lee M. Webb

CMKM Diamonds Inc., Saskatchewan native Urban Casavant's revoked pink sheet woofer, has made the big time, if that can be measured by an unflattering article in The New York Times and an equally biting follow-up blog entry by chief financial correspondent Floyd Norris.

The hook for Mr. Norris's Sept. 29 New York Times column was a National Association of Securities Dealers (NASD) enforcement action against Nevada-based NevWest Securities Corp. and its two senior officers, president Sergey Rumyantsev and vice-president Antony M. Santos.

As previously reported by Stockwatch, the NASD complaint alleges that the respondents violated anti-money laundering rules, failed to file suspicious activity reports with the U.S. Treasury Department's Financial Crimes Enforcement Network and basically looked the other way as a client with 32 accounts dumped a staggering 259 billion shares of CMKM for proceeds of $53-million. (All amounts are in U.S. dollars.)

The respondents have not yet filed a response to the complaint and no findings have been made regarding the allegations.

The NevWest client, identified only by the initials "JE" in the complaint is actually John Edwards, who is not a party to the NASD action.

As part of his column headlined "Selling Shares by the Billions to Racing Fans," Mr. Norris sketched some of the background of the wild CMKM sub-penny promotion.

The column

"Was this stock being traded by crooks?" Mr. Norris asks in his opening. "Should the brokers have noticed?

"How about the regulators, who now charge that the brokers missed 'red flags' but may have missed a few themselves."

According to Mr. Norris, who does not identify Mr. Edwards in his column, the NevWest client unloaded the vast majority of his 259 billion CMKM shares "before the company had bothered to let investors know so many shares existed."

In fact, while not mentioned by Mr. Norris, Mr. Casavant did what he could to keep investors in the dark about the massive dilution, including gagging the company's transfer agent.

Moreover, while he was peeling off hundreds of billions of shares that ended up in the hands of family, friends and business associates as well as his own, Mr. Casavant had his investor relations lackey Melvin O'Neil spread the word to the company's cult-like following that, far from diluting the company, he was retiring shares.

Much to the dismay and even continued disbelief among some of the CMKM fanatics, by the time the printing press was turned off there were an incredible 703.5 billion shares issued and outstanding.

Touching on CMKM's purported business, Mr. Norris goes on to say that CMKM claimed to be in the diamond business in Canada.

In fact, CMKM did scoop up some moose pasture in Saskatchewan and, along with a couple of Canadian joint venture partners, did manage to poke a few holes into the previously discovered and abandoned Smeaton kimberlite. That provided some promotional mileage.

CMKM's limited exploration also included drilling a hole at the Smeaton town dump, which at least provided a few laughs in the absence of any toutable results.

According to Mr. Norris, while the company could not come up with the money to work its claims, "it did spend $4 million to promote itself at 'funny car' races by sponsoring the CMKXtreme car, which had a drawing of a diamond and a miner on its side."

Given that CMKM has not filed any financial statements, the $4-million may be a best guess based on the letter of an auditor who was fired after reporting that he had uncovered possible criminal activities at the company.

Among other things, ousted auditor Brad Beckstead disclosed to CMKM and subsequently the SEC a possibly illegal transfer of $4-million to CMKXtreme Inc., a company controlled by Mr. Casavant.

In any event, CMKM at one time sponsored two funny cars, including one with a caricature of what appeared to be a construction worker wielding a jackhammer on some substance from which fully cut diamonds bounced into the air. CMKM also sponsored a speed truck and a motorcycle as part of its racy promotion.

As noted by Mr. Norris, the U.S. Securities and Exchange Commission (SEC) finally pulled the plug on CMKM. However, the revocation did not become final until Oct. 28, 2005, more than seven months after the regulator filed its administration proceeding against Mr. Casavant's dog of dogs and long after hundreds of billions of shares had been dumped on gullible investors.

After sketching the NASD complaint against NevWest and its two officers, Mr. Norris offers some final thoughts.

"What does all this prove?" Mr. Norris asks nearing the end of his column. "It may indicate that the Patriot Act gives regulators an unexpected tool to force brokers to tell the government when they see funny business. It may also reflect the fact that regulators do not even look at many filings.

"And it shows that this can go on and on. CMKM has reached a deal to sell what assets it has to Entourage Mining, a penny stock company based in Vancouver, British Columbia, which will pay with shares that will be distributed to CMKM holders."

Indeed, in a peculiar deal announced last year as CMKM dropped its appeal of the SEC ruling, paving the way for the regulator to finalize the revocation order last October, Entourage issued 45 million shares to the pink sheet promotion for some Saskatchewan claims under the control of Mr. Casavant's business associate Emerson Koch.

Entourage, which changes hands for less than 30 cents per share in light trading on the OTC Bulletin Board, has seen the majority of the claims acquired in the deal with CMKM expire, many of them before the 45 million shares were even issued.

"Looks like a hot stock to me," Mr. Norris remarks at the end of his column.

It remains to be seen whether the 45 million shares of that "hot stock" are eventually distributed to CMKM's shareholders.

In a rare SEC filing on Oct. 24, 2005, CMKM disclosed that it was in default on all of its mineral property agreements, did not have the money to continue operations and would be winding up its affairs.

As part of the winding up, the company announced that the 45 million Entourage shares would be distributed to CMKM shareholders.

To effect the liquidating distribution, CMKM struck a "task force" consisting of the company's former trophy co-chairman, 87-year-old Robert Maheu, corporate counsel Donald Stoecklein and Texas lawyer Bill Frizzell.

As previously reported by Stockwatch, Mr. Frizzell, a CMKM shareholder, represented about 5,000 other shareholders who anted up $25 each for his services during the administrative proceeding against the company.

Mr. Frizzell was among the company's cult-like followers convinced that the massively diluted pink sheet woofer's woes could be largely attributed to naked short selling.

The vaunted CMKM task force insisted that shareholders take physical delivery of their shares and fax copies to Mr. Frizzell's office in order to qualify for the Entourage distribution.

While the certificate pull was ostensibly instituted as part of the "orderly and verifiable pro rata liquidating distribution" of Entourage shares, the cockamamie scheme was underpinned by the belief that it would disclose a huge short position in CMKM.

Indeed, the task force, effectively spearheaded by Mr. Frizzell, proclaimed on its website that it had "credible information" indicating that there was a potential short position of two trillion shares.

As previously reported by Stockwatch, a review of CMKM's trading data debunks the incredible claim of a potential short position of two trillion shares.

From the time Mr. Casavant took control of CMKM in November of 2002 until the SEC yanked the company's stock registration in October of 2005, approximately 1.77 trillion CMKM shares changed hands.

It should be clear to most people that it is impossible to have a short position of two trillion shares when only 1.77 trillion shares have traded.

Interestingly, the impossible notion of a possible naked short position of two trillion shares was also debunked by information regarding delivery failures that was provided to Mr. Frizzell by the SEC.

Mr. Frizzell obtained the data for delivery failures in CMKM for April of 2005. Setting aside the observation that not all delivery failures represent naked short sales, the information provided to Mr. Frizzell shows that the failures in CMKM were insignificant and transient.

Indeed, the delivery failures topped out at approximately 186 million shares on April 22, 2005, a trifling amount for a company with 703.5 billion shares outstanding. Moreover, even that insignificant number of fails was settled a few days later. At the end of the month the delivery failures amounted to only approximately 3.1 million shares worth a picayune $300.

In any event, the vaunted task force perpetuated the fantasy about a massive naked short position, to the evident delight of many of CMKM's loyal followers.

Alas, the "cert pull" further debunked the notion of a massive naked short position and, as the scheme was winding down, Mr. Frizzell removed the claim about a potential short position of two trillion shares from the task force website.

The cert pull kicked off in November of 2005 and officially ended on May 15 of this year. According to the task force website, 39,648 CMKM shareholders faxed copies of their share certificates.

While that it is certainly a remarkable achievement, those certificates represented only approximately 633.3 billion shares, according to the task force's tally. That is approximately 70 billion shares less than CMKM's 703.5 billion issued and outstanding shares.

The ballyhooed task force officially dissolved on June 6, but the liquidating distribution of Entourage shares still has not taken place.

Reportedly, the task force recommended that CMKM proceed with an interpleader action in a U.S. District Court. In effect, CMKM would hand the 45 million Entourage shares over to the court and let a judge decide who has a legitimate claim to them and how they should be divided up.

So far, CMKM has not taken up the task force's recommendation and the liquidating distribution remains in limbo.

Meanwhile, some of CMKM's shrinking band of cult-like followers still believe that there is a massive naked short position in the revoked pink sheet dog of dogs.

Apparently some of the CMKM fanatics decided to set Mr. Norris straight on the matter.

Mr. Norris responded with what was essentially another article on his New York Times blog.

The blog

Evidently a quick study, by the time Mr. Norris posted his blog article on the evening of Sept. 29, he had identified Mr. Edwards as the NevWest client who dumped 259 billion CMKM shares for proceeds of $53-million.

"According to the NASD, many of the shares sold by J.E. had been registered in the name of the stock transfer agent used by the company, a rather unusual procedure," Mr. Norris wrote.

In fact, the NASD alleges that from August of 2004 and continuing into 2005, Mr. Edwards began depositing CMKM certificates in the name of NevWest's clearing firm, not the company's stock transfer agent.

As it happens, during that period, NevWest used Computer Clearing Services Inc. as its clearing agent.

A review of information from the master shareholders list as of Dec. 31, 2004, reveals that approximately 165 billion shares were issued in the name of Computer Clearing Services.

Interestingly, Computer Clearing Services routed almost all of its non-directed trades through subsidiaries of Knight Trading Group Inc., now known as Knight Capital Group.

During CMKM's racy promotion as billions of shares regularly traded on a daily basis, many of the company's cultish followers were stridently claiming that Knight was one of the firms shorting the stock. Of course, there was no evidence to back up the shorting claims.

Some of CMKM's loyal fans took the purported shorting issue up with Mr. Norris, who was clearly surprised at the choice of concerns.

In his blog article, Mr. Norris notes that Mr. Casavant invoked his Fifth Amendment right not to incriminate himself and refused to testify at the SEC administrative hearing in May of 2005.

He also notes that Mr. Maheu, then the company's touted co-chairman, knew nothing about CMKM's financial condition and had never even visited the company's office.

"So who are shareholders mad at?" Mr. Norris asks. "The management? The man who sold more than a third of the shares outstanding without ever filing a form saying he owned more than 5 percent, and who may have been an insider?

"The S.E.C. for letting this go on for a couple of years before revoking the company's registration, or for having not yet brought any charges against J.E. for selling them shares that may well be worthless?

"No, not any of them.

"A few shareholders who contacted me today were furious about my column because it failed to identify the real villains, as they saw it -- the naked short sellers who they say sold the shares without borrowing them."

Rounding out his blog entry, Mr. Norris reproduced a bit of correspondence from one of the CMKM "get shorty" fanatics.

"What possibly could be the reason you wrote about a worthless little pennystock CMKM Diamonds..and placed it on the first page of the NY Times business section," the writer wanted to know.

"Could it possibly be that the company has just about implicated every major brokerage firms in the country in the systematic rape of the American people due to the insidious practice of NAKED SHORT SELLING...COUNTERFEITING," the fantasizing correspondent continued.

"Your boss's (sic) on Wall Street will have to do some heavy spin on this one Floyd," the writer added.

Mr. Norris's blog response clearly did not satisfy some of the company's faithful followers.

"I will guilt this SOB into action!" an Internet poster identified as Jim Farn declared, pasting a copy of another message to Mr. Norris.

"You might be interested to know that Harvey Pitt would be disappointed that you have chosen to focus your efforts on 259 billion shares and John Edwards," Mr. Farn wrote.

It is not clear why the posited disappointment of Mr. Pitt, who was essentially forced out as SEC chairman in November of 2002 after only a 15-month stint, might be of any interest at all to Mr. Norris.

"IMO this is a naked short selling sting led by Mr. Bob Maheu," Mr. Farn continued. "You focussed on some questionable aspects of this story. I respectfully ask you to do some digging with regards to Maheu and 'forced communication'. You might find some similarity with Hughes planes and Casavants cars.

"You are grossly underestimating what you are discussing.

"As a Times subscriber and avid fan, I expect more and I simply do not understand your simplistic analysis and angle."

Ah, yes; welcome to the wild and woolly world of CMKM and its remaining gullible cult-like followers, Mr. Norris.

Meanwhile, CMKM has a new "interim" chief executive officer, Kevin West, who was appointed on Sept. 19. Mr. West, who has been a CMKM shareholder for a long time, worked on the certificate pull scheme initiated by the vaunted CMKM task force.

Mr. West also served as vice-president of The Owners Group Inc., a budding stock touting service that grew out of Mr. Frizzell's representation of CMKM shareholders during the SEC administrative proceeding against the company.

CMKM's new interim chief executive officer has been an ardent crusader against naked short selling, as he understands it.

Among other things, Mr. West circulated a letter written to U.S. President George Bush, SEC chairman William Donaldson and others in which he natters about collusion between the Depository Trust and Clearing Corp. and the SEC regarding short selling and suggests that journalists are paid to deceive people "into believing that there is no corruption."

"There are literally tens of thousands of average Americans who are now aware of the SEC's complicity in the sordid tale of abusive and illegal naked shorting," Mr. West wrote. "The DTCC 'earns' hundreds of millions of dollars annually by facilitating this violation of the small investor, and moreover we know the SEC gets a 'commission' on every violation."

Mr. West, who did a fair amount of Internet touting of CMKM, also once served up a "conservative" valuation of the company, pegging it at a modest $64-billion and suggesting that it could realistically be worth many times that amount.

CMKM's new leader also offered a rather interesting assessment of Mr. Casavant in a message to so-called bashers as the promotion was stumbling in October of 2004.

"No matter what you believe, Urban Casavant is a Godly man and God is using him to re-distribute the wealth on this earth," Mr. West wrote. "If you are one that try (sic) to mess with this plan, may God have mercy on your soul."

Since his appointment as interim chief executive officer, Mr. West has asked CMKM shareholders to help out with prayers.

The silly saga continues.

Comments regarding this article may be sent to [e-mail].

(Further information regarding CMKM Diamonds and associated companies can be found in Stockwatch articles dated Oct. 21, 2003; June 22; Sept. 16 and 24; Oct. 1, 15 and 20, 2004; Feb. 11, 14, 18, 22 and 23; March 1, 3, 4, 7, 14, 15, 16 and 21; June 6, 8, 9, 10, 13, 14, 15, 16, 17, 20, 21, 22, 29 and 30; July 1, 4, 6, 12 and 13; Aug. 2, 5 and 9; Sept. 7, 12, 27 and 30; Oct. 24, 26 and 31; Nov. 7, 11, 22 and 25; Dec. 1, 6, 9, 15 and 22, 2005; Jan. 3; and Sept. 29, 2006.)

[fung_derf]

Frizzell update of 9/19/06.....

FRIZZELL LAW FIRM
602 S. Broadway
Tyler, Texas 75701
[phone]

Greetings CMKX Shareholders,

This past couple of weeks has been agonizing for many of us around this office. I have been unable to speak with you because of the uncertainty we had about Kevin Wests hiring. I have been waiting for the press release that came out today. Kevin has been hired by CMKM Diamonds, Inc. Kevin told us a couple of weeks ago that he was discussing employment with Urban and other individuals at the company. At the time these discussions began, we mutually agreed that he would not work out of this office until there was a final agreement on his employment with CMKM Diamonds, Inc. Thus, we have not seen Kevin for a couple of weeks. In general terms he has called to tell us his progress relative to this employment change but we are not privy to the details of his hiring.

In my opinion, this is a good day for the shareholders of CMKX stock. I have had the opportunity to work with Kevin for the last 18 months. He is knowledgeable and most importantly he is a dedicated advocate for the shareholder. He is a fast learner and a self starter. He was generally the first to be at work and one of the last to leave. His work at this office went far beyond CMKX matters. He can help the company in many of its challenges.

Hiring Kevin tells me the company is dead serious about the matters that were covered in the last press release of the company. It is clear evidence to me that an interpleader will be filed. It is an indication to me that efforts are being made by the company to have its stock trade again. How long it will take is anyones guess, but I believe Kevin will move as quickly as he is allowed to move.

There will be some who will criticize Kevins hiring. Some will say this is a stall tactic or another token gesture to appease the shareholder group we have put together. This would be quite an error in judgment on the part of CMKM management if Kevin were hired for such reasons. Kevin and I spent hours discussing many things before Kevin finalized his decision to work for the company. I can promise you that Urban knew how Kevin felt about the plight of the shareholders, before an agreement was reached.

When you work with someone on a daily basis for 18 months, you have a pretty good feel about someones ability to handle pressure situations. Kevin gave this job offer a lot of thought before accepting this position. He has every intention of helping the company and the shareholders at the same time.

Kevin may not be Bill Gates or Warren Buffett, but he has a unique ability to calmly analyze troublesome situations and apply common sense solutions. His calm but firm demeanor has helped resolve many disputes. He is not easily swayed once he believes in a course of action. I do not know all the problems facing CMKX, but we all know the obvious ones. Kevin will figure out a way to begin delivering regular information to you. It may take Kevin a while, but I expect you will soon have a phone number to call and a live person you can contact with your questions. Anything Kevin approves in a press release in the future, I will believe until proven otherwise. Why would I make such a statement in light of the last couple of years of CMKX problems? Because Kevin is a man of character and morally sound. He simply has never lived a lifestyle that we often see when corporate greed overtakes the obligations to work in the best interests of the shareholders.

I am hopeful this is the first press release of many to come in the next few months. I do not expect all of you to jump with joy simply because we believe this is good news. I would suggest however that you give Kevin some time to get a handle on the problems. You can then make your own decisions on his ability to get this company back on course. I have been fielding calls lately from various shareholders telling me of their desire to begin legal proceedings against the company. I will not encourage you nor discourage you from pursuing litigation. You make your own decision in that regard. I plan to cooperate in any way I can with Kevin in hopes that the company will take the necessary steps to build this company back.

Kevin knows the shareholders are a group that has endured much frustration and on occasions misdirection. He knows the only way he will get your full support is by positive things occurring under his watch. I hope Urban and any one else that is directing the company will give responsibility and support to Kevin. This is one update that I have really enjoyed writing.


Onward,

Bill
« Last Edit: Today at 3:51pm by NOS ProMod »



http://cmkxgroup.proboards88.com/index.cgi?board=general&action=display&thread=1158702136

[fung_derf]

A response to the article in the Wall St. Journal....

September 29, 2006, 7:33 pm
Blame the Naked Shorts

Who was the man, mentioned in my column today, who sold 259 billion shares of stock in CMKM Diamonds, a stock that sold for fractions of a penny, and took in $53 million from sales of the stock? And where did he get the shares?

The NASD complaint gives only his initials, J.E., and an address that turns out to be a Las Vegas post office box that the company had used. A search of records turned up the fact that a John Edwards had used the address, but did not uncover a way to reach him.

When a Securities and Exchange Commission administrative law judge held a hearing on CMKM last year, an auditor who was hired to audit the company’s books, but quit after few records were provided, testified that he was recommended for the post by a friend of his named John Edwards, who sat in on the meeting where he was retained.

The auditor, Neil Levine of Bagell, Josephs & Company, said Mr. Edwards had brought him in for a number of audits after the accountant he had been using decided not to register with the Public Company Accounting Oversight Board in 2004.

According to the NASD, many of the shares sold by J.E. had been registered in the name of the stock transfer agent used by the company, a rather unusual procedure.

And how did he get those shares? I don’t know, but it appears that billions of shares were issued by the company with little in the way of explaination. “Isn’t it very unusual,” asked the judge, Brenda Murray in reference to one of the transactions, “that a company would issue 3 billion shares and not list a reason?” Mr. Levine agreed that it was.

He also testified that company officials told him it had no revenues during the three years that he was supposed to audit.

So what we have here is a company that seems to have spent little on its ostensible business, but spent millions on a race car that seemed intended to promote the stock, of which billions of shares were issued with little in the way of explanation, and sold by a man whose name was not on the certificates. The company filed a form it later admitted was false in order to get out of reporting its finances to the S.E.C.

We also have a president of the company, Urban Casavant (the C in CMCK) who chose to invoke his Fifth Amendment right not to incriminate himself, rather than testify at the S.E.C. hearing, and a board co-chairman, Robert Maheu, who testified he was not familiar with the company’s assets or liabilities, and had never visited its offices.

So who are shareholders mad at? The management? The man who sold more than a third of the shares outstanding without ever filing a form saying he owned more than 5 percent, and who may have been an insider? The S.E.C. for letting this go on for a couple of years before revoking the company’s registration, or for having not yet brought any charges against J.E. for selling them shares that may well be worthless?

No, not any of them. A few shareholders who contacted me today were furious about my column because it failed to identify the real villains, as they saw it — the naked short sellers who they say sold the shares without borrowing them.

As one of them so gently put it:

“Mr Norris…What possibly could be the reason you wrote about a worthless little pennystock…CMKM Diamonds..and placed it on the first page of the NY Times business section. Could it possibly be that the company has just about implicated every major brokerage firms in the country in the systematic rape of the American people due to the insidious practice of NAKED SHORT SELLING…COUNTERFEITING….Your boss’s on Wall Street will have to do some heavy.spin on this one Floyd…
- - - - -

[fung_derf]

Article in Wall Street Journal about CMKX.....

Selling Shares by the Billions to Racing Fans
E-Mail
Print
Reprints
Save


By FLOYD NORRIS
Published: September 29, 2006
Was this stock being traded by crooks? Should the brokers have noticed? How about the regulators, who now charge that the brokers missed “red flags” but may have missed a few themselves.

The story of a tiny Nevada company that claimed to be in the diamond mining business but spent the little money it had on sponsoring a race car, sheds light on the market for small stocks that can fly below the radar for years.

It is a story that involves a former F.B.I. agent and associate of Howard Hughes, who was promised a lot of money for doing very little but says he did not get the cash, and an auditing firm that was fired 11 days after it was hired. There is a claim that the Patriot Act — the law passed after Sept. 11, 2001, as a way to fight terrorism — was violated.

The company, CMKM Diamonds, never traded for as much as 2 cents a share, and most of the trades were for about a fifth of a penny. But that did not stop one trader from taking in an impressive $53 million. He sold more than 259 billion shares from 2003 to 2005, a vast majority of them before the company had bothered to let investors know so many shares existed.

All that from stock in a company that, when it last filed a balance sheet with the Securities and Exchange Commission, in 2002, reported total assets of $344.

After that, the company went into the diamond business, or at least said it did, acquiring some mineral claims in Canada. Some of those claims were later given away because the company could not come up with the money needed to work on them, but it did spend $4 million to promote itself at “funny car” races by sponsoring the CMKXtreme car, which had a drawing of a diamond and a miner on its side.

The S.E.C. later concluded the company had lied when it claimed it did not have to file reports with the S.E.C., and revoked its registration. The company said that it made an honest mistake when it filed a form claiming the exemption, and that the S.E.C. should have noticed that the form was obviously in error.

While it was not filing financial statements, it was seeking publicity, both through the race car and through press releases.

One of them reported the hiring of Robert Maheu, a former F.B.I. agent who it said had “served as an adviser to many great men and companies throughout the history of America.” It listed some of those he had been associated with, including Howard Hughes and the C.I.A., adding, “To list all of Maheu’s accomplishments would turn this brief announcement into a novel.”

Mr. Maheu became co-chairman of the board and chairman of the audit committee, at a salary of $40,000 a month, but his testimony before the S.E.C. convinced an administrative law judge that he was not very well informed. He did not know how many employees the company had, or what they did. He was not familiar with the company’s assets or liabilities.

Nor had he ever visited the company’s offices. But that is no surprise. One address it gave to the S.E.C. was actually the home of a hot-rod shop.

When I reached Mr. Maheu this week, he said his lawyer had told him not to comment, but he did say the company had not paid him what he was owed.

Perhaps the highlight of this story was the audit firm that left quickly, after warning the company’s board of possible criminal activities. The company’s lawyer protested that the auditor could not know any such thing, given that so many of the company’s records could not be found.

This week, NASD, the regulatory agency for the over-the-counter and Nasdaq markets, filed a disciplinary complaint against NevWest Securities, the small brokerage firm that handled the trades for the man who sold more than 30 percent of the shares in the company, giving the firm an address that was a postal box. As it happened, the company used the same address.

The NASD claimed NevWest, which is based in Las Vegas, should have filed reports of “suspicious activity” with the Treasury Department, as required by the Patriot Act. That section is supposed to deal with money laundering, but it requires brokers to report evidence of violation of any federal law.

Sergey Rumyantsev, NevWest’s president, told me his firm did nothing wrong. Anyway, he said, NASD examiners did not complain when they learned of some of the trades in 2004.

What does all this prove? It may indicate that the Patriot Act gives regulators an unexpected tool to force brokers to tell the government when they see funny business. It may also reflect the fact that regulators do not even look at many filings.

And it shows that this can go on and on. CMKM has reached a deal to sell what assets it has to Entourage Mining, a penny stock company based in Vancouver, British Columbia, which will pay with shares that will be distributed to CMKM holders.

Looks like a hot stock to me.

[fung_derf]

Stockpatrol on recent events of NevWest...

CMKM Diamonds, Inc. is back in the news. NASD has charged NevWest Securities Corporation of Las Vegas and two of its top officers - President Sergey Rumyantsev and Vice President Antony M. Santos - with violating NASD's Anti-Money Laundering Rule by failing to adequately monitor and decline suspicious trades of CMKM shares.



NASD claims that NevWest earned commission of $2.5 million by selling more than 250 billion shares of CMKM stock between January 2003 and November 2005 for a customer who opened 32 accounts with the brokerage firm. The commissions represented over one-third of the firm's income during that period. In its complaint, NASD charges that NevWest failed to implement and enforce procedures to forestall possible securities fraud. NASD has not publicly disclosed the identity of NevWest's customer.



CMKM first captured the attention of StockPatrol.com in June 2004. At the time, demand for CMKM stock – which was trading at a rate of several billion shares each day – appeared to be vastly out-of-proportion to the tiny Company's value. Although its prospects were purely speculative, CMKM quickly gained a following of loyal supporters who clung to hope that the struggling Company would someday uncover valuable minerals. But, aside from a pipeline of hype and promises, sponsorship of a race car, and convoluted relationships with other troubled over-the-counter entities, CMKM produced nothing of value. See, CMKM Diamonds, Inc. - A Familiar Drill.



Information about CMKM was fragmentary at the height of this trading. The Company had ceased filing public reports in November 2002 claiming, inaccurately, that it no longer was required to do so. On March 3, 2005, the SEC temporarily suspended trading in CMKM's securities, citing the absence of accurate public information about the Company's activities. On March 16, 2005, the SEC filed an administrative complaint, seeking to permanently revoke or suspend registration of CMKM's shares. See, SEC Suit Against CMKM Diamonds, Inc. Could Sink Company. In October 2005 CMKM surrendered to the SEC and the Company's shares ceased to be registered. See, CMKM Diamonds, Inc. - Tapped Out and Taps.



Considering the staggering trading volume when the CMKM hype was at its peak, and the complete absence of public information about CMKM's activities and finances, it should have been evident to most thoughtful observers that "suspicious activity" afoot. Yet, as NASD now alleges, when its customer used 32 different accounts to dump CMKM stock, NevWest failed to file required Suspicious Activity Reports which would have put law enforcement officials on notice. "Broker-dealers have an obligation to investigate 'red flags' indicating suspicious activity and, where appropriate, to file [Suspicious Activity Reports], according to NASD Executive Vice President and Head of Enforcement, James S. Shorris. In this instance NevWest was obligated to report the suspicious activity to the U.S. Treasury Department's Financial Crimes Enforcement Network (FinCEN).



NevWest could hardly have failed to notice the suspicious activities – 500 separate trades – or the questionable conduct of CMKM. NASD points out the following 'red flags,' that should have triggered appropriate action by the broker-dealer:



The massive volume of CMKM stock that was being sold through NevWest by its customer, which constituted as much as 36.7% of CMKM's total outstanding shares;


Publicly available information about CMKM. The Company's last quarterly report, filed with the SEC on Nov. 18, 2002, showed that for the quarter ending September 2002, CMKM had total assets of only $344 cash and total liabilities of $1,672;


CMKM's failure to file annual or quarterly reports with the SEC after September 2002;


Information showing a relationship between the NevWest customer engaging in the suspicious transactions and a former officer of CMKM;


The SEC's temporary suspension of over-the-counter trading in CMKM securities from March 3, 2005 through March 16, 2005 and the SEC's action on May 10, 2005 to revoke the registration of each class of CMKM stock. Despite the SEC's actions, NevWest sold at least 22 billion shares for its customer's accounts between March 17, 2005 and May 11, 2005.


The NASD complaint contains several additional charges against NevWest. NASD alleges, among other things, that the firm failed to report customer complaints on a timely basis and did not establish or maintain an adequate supervisory system.



NevWest and its officers are subject to a broad range of possible sanctions including fines, suspension and expulsion.




IF YOU HAVE QUESTIONS OR COMMENTS FOR STOCKPATROL.COM, CONTACT US AT [e-mail]

All content © 2005 StockPatrol.com. All
http://www.stockpatrol.com/article/key/update_cmkm906

[fung_derf]

NEVWEST SECURITIES CORPORATION


Business Entity Information

Status: Active on 12/7/2005 File Date: 7/21/1997
Type: Domestic Corporation Corp Number: C15592-1997
Qualifying State: NV List of Officers Due: 7/31/2007
Managed By: Expiration Date:


Resident Agent Information

Name: NEVWEST SECURITIES CORPORATION Address 1: 5440 W. SAHARA AVE.
Address 2: SUITE 202 City: LAS VEGAS
State: NV Zip Code: 89146
Phone: Fax:
Email: Mailing Address 1:
Mailing Address 2: Mailing City:
Mailing State: Mailing Zip Code:

View all business entities under this resident agent

Financial Information

No Par Share Count: 0 Capital Amount: $ 25,000.00
Par Share Count: 25,000,000.00 Par Share Value: $ 0.001


Officers Include Inactive Officers

Secretary - DAVID LAUB
Address 1: 5440 W. SAHARA AVE. Address 2: STE. 202
City: LAS VEGAS State: NV
Zip Code: 89146 Country:
Status: Historical Email:

Treasurer - DAVID LAUB
Address 1: 5440 W. SAHARA AVE. Address 2: STE. 202
City: LAS VEGAS State: NV
Zip Code: 89146 Country:
Status: Historical Email:

Director - DAVID LAUB
Address 1: 5440 WEST SAHARA Address 2: SUITE 202
City: LAS VEGAS State: NV
Zip Code: 89146 Country: USA
Status: Historical Email:

Secretary - DAVID LAUB
Address 1: 5440 W. SAHARA AVE. Address 2: STE. 202
City: LAS VEGAS State: NV
Zip Code: 89146 Country:
Status: Active Email:

Treasurer - DAVID LAUB
Address 1: 5440 W. SAHARA AVE. Address 2: STE. 202
City: LAS VEGAS State: NV
Zip Code: 89146 Country:
Status: Active Email:

Director - DAVID LAUB
Address 1: 5440 WEST SAHARA Address 2: SUITE 202
City: LAS VEGAS State: NV
Zip Code: 89146 Country: USA
Status: Active Email:

Director - DON MINER
Address 1: 5440 WEST SAHARA Address 2: SUITE 202
City: LAS VEGAS State: NV
Zip Code: 89146 Country: USA
Status: Historical Email:

Director - DON MINER
Address 1: 5440 WEST SAHARA Address 2: SUITE 202
City: LAS VEGAS State: NV
Zip Code: 89146 Country: USA
Status: Active Email:

President - SERGEY RUMYANTSEV
Address 1: 5440 W. SAHARA AVE. Address 2: STE. 202
City: LAS VEGAS State: NV
Zip Code: 89146 Country:
Status: Historical Email:

Director - SERGEY RUMYANTSEV
Address 1: 5440 WEST SAHARA Address 2: SUITE 202
City: LAS VEGAS State: NV
Zip Code: 89146 Country: USA
Status: Historical Email:

President - SERGEY RUMYANTSEV
Address 1: 5440 W. SAHARA AVE. Address 2: STE. 202
City: LAS VEGAS State: NV
Zip Code: 89146 Country:
Status: Active Email:

Director - SERGEY RUMYANTSEV
Address 1: 5440 WEST SAHARA Address 2: SUITE 202
City: LAS VEGAS State: NV
Zip Code: 89146 Country: USA
Status: Active Email:

Director - ANTONY SANTOS
Address 1: 5440 WEST SAHARA Address 2: SUITE 202
City: LAS VEGAS State: NV
Zip Code: 89146 Country: USA
Status: Historical Email:

Director - ANTONY SANTOS
Address 1: 5440 WEST SAHARA Address 2: SUITE 202
City: LAS VEGAS State: NV
Zip Code: 89146 Country: USA
Status: Active Email:

[fung_derf]

The whole file on the lawsuit against Nevwest...

NASD
OFFICE OF HEARING OFFICERS
DEPARTMENT OF ENFORCEMENT,
Complainant,
v.
NEVWEST SECURITIES
CORPORATION,
(CRD No. 46464),
SERGEY RUMYANTSEV,
(CRD No. 4009791),
and
ANTONY M. SANTOS,
(CRD No. 3239243),
Respondents.
Disciplinary Proceeding
No. E0220040112-01
Hearing Officer -
Note for electronic delivery this complaint:
The issuance of a disciplinary complaint represents the initiation of a formal proceeding by NASD Regulation in which findings as to the allegations in the complaint have not been made and does not represent a decision as to any of the allegations contained in the complaint. Because this complaint is unadjudicated, you may wish to contact the respondent before drawing any conclusions regarding the allegations in the complaint.
COMPLAINT
The Department of Enforcement alleges:
SUMMARY
1. From at least September 2002 to May 2005 (the “relevant period”), NevWest Securities Corporation (“NevWest”), a Nevada broker-dealer, violated various
NASD Conduct Rules and provisions of the Securities Exchange Act of 1934 and the rules promulgated thereunder.
2. First, NevWest, acting through Sergey Rumyantsev (“Rumyantsev”) and Antony M. Santos (“Santos”), failed to adequately implement and enforce anti-money laundering (“AML”) procedures in accordance with NASD Conduct Rules 3011 and 2110, and NevWest violated Municipal Securities Rulemaking Board (“MSRB”) Rule G-41. For example, between January 1, 2003 and May 31, 2005, NevWest failed to adequately perform due diligence, file Suspicious Activity Reports (“SAR”) or cease trading in multiple accounts owned and controlled by JE, NevWest’s customer, regarding over 500 transactions, involving more than 250 billion shares of sub-penny stock issued by CMKM Diamonds, Inc. (“CMKM”) totaling over $53.0 million. As a result of these sales, NevWest earned commission revenue totaling $2.5 million, which accounted for approximately 36% of the firm’s total revenue during the relevant period.
3. Moreover, between January 2003 and December 2004, NevWest failed to adequately perform due diligence, file SARs, or cease effecting wire transfers involving $43 million through 139 separate wires from at least 28 of the accounts JE had opened at NevWest to various bank accounts.
4. Second, between February 2004 through July 2004, NevWest violated Section 15(c)(2) of the Securities Exchange Act of 1934 and SEC Rule 15c2-4 promulgated thereunder (“SEC Rule 15c2-4”) and NASD Conduct Rule 2110, and Santos violated NASD Conduct Rule 2110, in connection with the Ascendant Select Fund I, LLC contingency offering when NevWest, through Santos, caused funds to be withdrawn from bank escrow accounts prior to selling the minimum amount of securities through
2
bona fide transactions. NevWest thereby failed to properly escrow funds for the sales of securities until the contingencies were satisfied.
5. Third, between February 2004 through July 2004, NevWest and Santos violated Section 10(b) of the Securities Exchange Act of 1934 and SEC Rule 10b-9 promulgated thereunder (“SEC Rule 10b-9”) and NASD Conduct Rule 2110 in connection with the Ascendant Select Fund I, LLC contingency offering when NevWest, acting through Santos, released purchasers’ funds to the control of the issuer before the contingencies were satisfied through bona fide transactions, thereby rendering representations in the respective private placement memoranda false and misleading.
6. Fourth, between October 2003 through January 2004, NevWest violated SEC Rule 15c2-4 and NASD Conduct Rule 2110, and Santos violated NASD Conduct Rule 2110, in connection with the PracticeXpert, Inc. contingency offering when NevWest, through Santos, caused funds to be withdrawn from bank escrow accounts prior to selling the minimum amount of securities through bona fide transactions. NevWest thereby failed to properly escrow funds for the sales of securities until the contingencies were satisfied.
7. Fifth, between October 2003 and January 2004, NevWest and Santos violated SEC Rule 10b-9 and NASD Conduct Rule 2110 in connection with the PracticeXpert, Inc. contingency offering when NevWest, acting through Santos, released purchasers’ funds to the control of the issuer before the contingencies were satisfied through bona fide transactions, thereby rendering representations in the respective private placement memoranda false and misleading.
8. Sixth, between February 28, 2003 and September 2004, NevWest violated
3
NASD Conduct Rules 3070 and 2110 because it failed to timely file reports with NASD relating to customer complaints and disclosure events.
9. Seventh, between October 2003 and September 2004, NevWest, acting through Santos, violated NASD Conduct Rules 3010 and 2110 by failing to establish, maintain and enforce an effective supervisory system, including adequate written supervisory procedures, that was reasonably designed to achieve compliance with applicable federal securities laws and rules, and NASD Rules with respect to contingency offerings and the timely reporting of customer complaints and disclosure events.
RESPONDENTS
10. NevWest, CRD No. 46464, has been a member of NASD since October 19, 1999. Since September 4, 2001, NevWest has been registered with the MSRB. NevWest is headquartered in Las Vegas, Nevada and employs approximately 10 registered representatives. During all times relevant to the complaint, NevWest primarily engaged in the liquidation of low-priced securities, sold largely in the over-the-counter market (“OTC”) including the Pink Sheets. NevWest also acts as a market maker in low-priced securities and participates in private placement offerings.
11. Rumyantsev, CRD No. 4009791, has been associated with NevWest since August 1, 1999. Rumyantsev became registered as a General Securities Representative (Series 7) in 1999, as an Equity Trader Representative (Series 55) in 1999, as a General Securities Principal (Series 24) in 1999, as a Municipal Securities Principal (Series 53) in 2001, as a Financial and Operations Principal (Series 27) in 2002 and as a Compliance Registered Options Principal (Series 4) in 2004. Rumyantsev also serves as NevWest’s Chief Executive Officer and Head Trader.
4
12. Santos, CRD No. 3239243, has been associated with NevWest since April 30, 1999. Santos became registered as a General Securities Representative (Series 7) and as a General Securities Principal (Series 24) in July 1999. Santos also serves as the firm’s Executive Vice President, Chief Compliance Officer and on occasion as the firm’s General Counsel.
FIRST CAUSE OF ACTION
(INADEQUATE ANTI-MONEY LAUNDERING PROGRAM –
Violation of NASD Conduct Rules 3011 and 2110
Respondents – NevWest, Santos and Rumyantsev
and Violation of MSRB Rule G-41 – Respondent NevWest)
13. The Department realleges and incorporates by reference paragraphs 1 through 12 above.
Broker-Dealer Responsibilities Under
the Anti-Money Laundering Laws and Rules
14. NASD Conduct Rule 3011, adopted on April 24, 2002 and amended on October 22, 2002, requires all member firms to “develop and implement a written anti-money laundering program reasonably designed to achieve and monitor the firm’s compliance with the requirements of the Bank Secrecy Act (31 U.S.C. § 5311, et seq.), and the implementing regulations promulgated thereunder by the Department of the Treasury.”
15. NASD Conduct Rule 3011(a) requires NASD members to establish and implement policies and procedures “that can be reasonably expected to detect and cause the reporting of” suspicious activity and transactions.
16. The United States Department of the Treasury issued the implementing regulation, 31 CFR § 103.19(a)(1), on July 2, 2002, for suspicious transaction reporting
5
for broker-dealers. It provided that, with respect to any transaction after December 30, 2002, “[e]very broker or dealer in securities within the United States . . . shall file with FinCEN . . . a report of any suspicious transaction relevant to a possible violation of law or regulation.” Section (a)(2) of that regulation provides:
A transaction requires reporting . . . if it is conducted or attempted by, at, or through a broker-dealer, it involves or aggregates funds or other assets of at least $5,000, and the broker-dealer knows, suspects, or has reason to suspect that the transaction (or a pattern of transactions of which the transaction is a part):
(i) Involves funds derived from illegal activity or is intended or conducted in order to hide or disguise funds or assets derived from illegal activity (including, without limitation, the ownership, nature, source, location, or control of such funds or assets) as part of a plan to violate or evade any federal law or regulation or to avoid any transaction reporting requirement under federal law or regulation;
(ii) Is designed, whether through structuring or other means, to evade any requirements of this part or any other regulations promulgated under the Bank Secrecy Act, . . .;
(iii) Has no business or apparent lawful purpose or is not the sort in which the particular customer would normally be expected to engage, and the broker-dealer knows of no reasonable explanation for the transaction after examining the available facts, including the background and possible purpose of the transaction; or
(iv) Involves use of the broker-dealer to facilitate criminal activity.
17. In August 2002, NASD issued Notice to Members (“NTM”) 02-47, which set forth the provisions of the final AML rule for suspicious transaction reporting promulgated by the United States Department of the Treasury (“Treasury”) for the securities industry. This NTM further advised broker-dealers of their duty to file a SAR for certain suspicious transactions occurring after December 30, 2002. NTM 02-47
6
discusses Treasury’s release adopting the final suspicious activity reporting rule for broker-dealers. Treasury’s release states that broker/dealers should determine whether activities surrounding certain transactions raise suspicions of no business or apparent lawful purpose by looking for “red flags” such as those enumerated in NASD NTM 02-21.
18. NTM 02-21, which was adopted in April 2002, advised broker-dealer firms of the requirements of their AML procedures, including that AML procedures apply to:
a. account opening and maintenance, including verification of the identity of the customer;
b. monitoring of account activities, including but not limited to, trading and the flow of money into and out of the account, the types, amount, and frequency of different financial instruments deposited into and withdrawn from the account, and the origin of such deposits and the destination of withdrawals; and
c. monitoring for, detecting, and responding to “red flags.”
19. NTM 02-21 emphasized each firm’s duty to detect red flags and, if it detects any, “perform additional due diligence before proceeding with the transaction.” NTM 02-21 also set forth examples of “red flags,” including but not limited to:
a. Upon request, the customer refuses to identify or fails to indicate any legitimate source for his or her funds or other assets;
b. The customer maintains multiple accounts, or maintains accounts in the names of family members or corporate entities, for no apparent business purpose or other purpose;
c. For no apparent reason, the customer has multiple accounts under a single name or multiple names, with a large number of inter-account or third-party transfers; and
d. The customer exhibits a lack of concern regarding risks, commissions, or other transaction costs.
7
20. The SAR form indicates 20 “Type[s] of suspicious activity” that must be reported, including “Market manipulation,” “Money laundering/Structuring,” “Prearranged or other non-competitive trading,” “Securities fraud,” “Significant wire or other transactions without economic purpose,” “Suspicious documents or ID presented,” “Wash or other fictitious trading,” “Wire fraud,” and “Other.”
21. MSRB Rule G-41, which the SEC approved on July 11, 2003, requires every NASD member broker, dealer and municipal securities dealer to establish and implement an AML compliance program designed to achieve and monitor ongoing compliance with the requirements of NASD Conduct Rule 3011. On July 16, 2003, the MSRB issued Notice 2003-28 announcing that Rule G-41 had been approved.
JE’s Activities at NevWest
22. In or about September 2002, JE began opening accounts with a registered representative at NevWest. From 2002 through December 2004, JE opened and controlled 32 accounts for various trusts and corporate entities, including one personal retirement account (collectively, “JE’s accounts”). JE opened: five accounts in 2002; 19 accounts in 2003; and eight accounts in 2004.
23. In or about January 2003 and continuing through at least January 2005, JE completed new account documents for some of the accounts opened with NevWest. For example, JE completed new account documents to reflect changes made to the various trusts and corporate entities. Additionally, JE completed new account documents for some of his accounts when NevWest switched clearing firms.
24. According to the new account documents, JE acted as Trustee on behalf of each of the 26 trust accounts he opened at NevWest. The Declaration of Trust documents
8
JE submitted in connection with the trust accounts do not identify any beneficiary, but instead state that JE, as trustee, may sell units of beneficial interest in the trusts to purchasers.
25. JE also served as the sole officer and director for each of the five corporate accounts he opened at NevWest.
26. The customer address in 30 of JE’s 32 accounts was 7500 West Lake Meade Boulevard, Suite 9627, Las Vegas, Nevada 89128. JE also used his personal social security number as the tax identification number in 29 of JE’s 32 accounts.
27. Shortly after JE began opening accounts at NevWest, he developed a trading pattern of physically carrying into the firm, certificates of low-priced securities. In February 2003, JE began to deposit shares of CMKM into the various accounts he opened at NevWest. JE instructed NevWest, through his registered representative, to expeditiously liquidate the certificates, and to immediately wire all sales proceeds to various bank accounts. The bank account owner of record rarely matched the name of the NevWest account holders.
28. Until trading in CMKM shares was permanently halted by court order dated October 28, 2005, CMKM shares traded in the Pink Sheets, first under the symbol “CMKM,” and later under the symbol “CMKX,” through matched trades of unsolicited orders.
29. During the relevant period, JE sold approximately 259 billion shares of CMKM through NevWest, at an average price of $0.00021 per share. NevWest executed trades for JE’s accounts in agency transactions. During the relevant period the price of
9
CMKM shares generally ranged from a high of $0.00057 per share in June 2004 to a low of $0.00005 price per share in May 2005.
Transactions in 2003
30. The number of transactions and the amounts of CMKM certificates JE sold through NevWest increased over time. During 2003, JE sold a total of 4.3
billion shares of CMKM, in 66 transactions, which resulted in sales proceeds to JE totaling over $401,000 as follows:
JE’s CMKM Transactions in 2003
Month
Shares Sold
Proceeds
Number of Transactions
Mar
1,450,000
$2,320
2
Apr
2,000,000
$1,100
1
May
15,000,000
$6,000
2
June
2,800,000
$1,480
2
July
-
-
0
Aug
19,000,000
$6,150
7
Sep
130,000,000
$31,870
11
Oct
2,405,600,000
$200,034
28
Nov
733,000,000
$60,590
8
Dec 1,030,000,000
$92,400
5
2003 Totals
4,338,850,000
$401,944
66
31. During 2003, JE wired a total of over $1.4 million from accounts with NevWest in 49 separate transactions, which included proceeds from the sale of CMKM stock.
Transactions in 2004
32. In 2004, JE began to aggressively implement his trading strategy in CMKM shares. In many instances, JE carried into NevWest billions of CMKM shares at a time. Through NevWest, he liquidated billions of shares per month. For example, in
10
February 2004, JE executed 35 transactions and sold over 11 billion shares, which resulted in sales proceeds totaling almost $592,000.
33. Moreover, between June 2004 and November 2004, JE sold, through NevWest, approximately 150 billion shares of CMKM in 257 transactions that generated proceeds totaling about $44.4 million. During this same period, JE wired from his accounts at NevWest to various bank accounts under his control, a total of $38 million in 57 separate wire transactions.
34. During 2004, JE sold approximately 207 billion shares of CMKM in 368 transactions that resulted in sales proceeds to JE totaling over $49 million as follows:
JE’s CMKM Transactions in 2004
Month
Shares Sold
Proceeds
Number of Transactions
Jan
895,000,000
$51,400
8
Feb
11,704,999,996
$591,750
35
Mar
50,000,000
$5,300
5
Apr
1,940,000,000
$169,600
16
May
2,269,800,000
$296,800
12
Jun
16,095,200,000
$9,147,682
55
Jul
32,879,697,204
$10,513,518
63
Aug
27,470,750,000
$9,037,970
35
Sep
15,716,000,000
$4,558,830
32
Oct
47,331,500,000
$9,224,166
49
Nov
10,500,000,000
$1,886,000
23
Dec
40,161,764,295
$3,742,359
35
2004 Totals
207,014,177,495
$49,225,375
368
35. In early 2004, RD, the firm’s designated AML Compliance Officer, recommended to Santos that NevWest file a SAR regarding JE’s transactions in CMKM. Despite RD’s recommendations, Santos and Rumyantsev chose not to file a SAR. Moreover, in connection with JE, his accounts and sales of CMKM, Santos and Rumyantsev did not include RD in any AML-related discussion, analysis or decision.
11
36. In or about August 2004, NevWest’s registered representative handling JE’s accounts recommended to Santos and Rumyantsev that NevWest file a SAR in connection with JE’s trading activities regarding the CMKM shares. Despite this registered representative’s recommendation, Santos and Rumyantsev declined to file a SAR.
37. In 2004, JE wired funds totaling over $41.5 million from his accounts at NevWest to various bank accounts under his control.
Transactions in 2005
38. From January 1, 2005 through May 2005, JE sold over 48 billion shares of CMKM in 133 transactions that resulted in sales proceeds totaling $3.7 million as follows:
JE’s CMKM Transactions in 2005
Month
Shares Sold
Proceeds
Number of Transactions
Jan
18,600,000,000
$1,805,000
21
Feb
5,623,352,000
$564,335
30
Mar
13,408,899,621
$809,587
32
Apr
9,423,319,738
$476,801
43
May
1,438,900,000
$75,943
7
2005 Totals
48,494,471,359
$3,731,666
133
Red Flags
39. NevWest’s AML procedures stated that:
[w]hen a member of the firm detects any red flag he or she will investigate further under the direction of the AML Compliance Officer. This may include gathering additional information internally or from third party sources, contacting the government, freezing the account, and filing a SAR.
40. With respect to JE’s CMKM transactions and wire transfer activity referenced in the Complaint, NevWest failed to implement and enforce adequate AML
12
procedures in violation of NASD Conduct Rule 3011 and, as a result, failed to “observe high standards of commercial honor and just and equitable principles of trade” as required by NASD Conduct Rule 2110. AML rules and NevWest’s own procedures required NevWest, under the direction of its AML Compliance Officer, to collect further information, perform additional due diligence, file a SAR and/or freeze JE’s accounts with respect to JE’s CMKM transactions, but NevWest failed to do so. NevWest, acting through Santos and Rumyantsev, was aware or should reasonably have been aware of “red flags,” which should have individually or collectively triggered NevWest’s AML obligations. These “red flags” included, but were not limited to, the following:
a. JE suspiciously refused to reasonably explain how he acquired the CMKM shares. In October 2004, Santos and Rumyantsev asked JE whether he could identify the individuals from whom he acquired his CMKM shares. In November 2004, JE provided NevWest with a letter from his personal attorney that stated the attorney had “reviewed the trading practices of [JE] and such practices appear to be in complete compliance with federal and Nevada law.” At no relevant time, did Santos or Rumyantsev ask JE to specifically identify the individuals and the details surrounding each transaction in which JE acquired the shares.
b. JE suspiciously opened and maintained 32 accounts at the firm for no business or apparent lawful purpose.
c. Over the relevant period, before liquidating his CMKM shares through NevWest, JE personally hand-delivered the CMKM certificates to the
13
firm. The CMKM certificates JE deposited for sale were not always registered in the name of a specific account holder with NevWest. Instead, beginning in or about August 2004 and continuing into 2005, JE began depositing certificates registered in the name of NevWest’s clearing firm.
d. JE’s wire transfers from his NevWest accounts were suspicious in that the wire activity involved: large dollar amounts; frequent activity; and repetitive wire transfer patterns. In addition, JE generally instructed the firm to wire funds “as they became available” from the various NevWest accounts he established to, most often, only two Nevada bank accounts held by business entities which neither sold the CMKM certificates, nor maintained accounts at NevWest. The suspicious wire transfers included, without limitation, the following: of the 139 separate wire transactions from JE’s accounts, 116 were for amounts greater than $5,000, of which 57 were for amounts between $5,000 and $100,000; 30 were for amounts between $100,000 and $500,000; 17 were for amounts between $500,000 and $1 million; nine were for amounts between $1 million and $2 million; two wires exceeded $2 million; and one exceeded $4 million.
e. JE suspiciously exhibited a lack of concern regarding the commissions and other transaction costs relating to the liquidation of CMKM shares. NevWest uncharacteristically charged JE 5% for each transaction. The 5% commission was well-above NevWest’s
14
customary rate of 3-4% it normally charged its customers for penny stock transactions.
f. The substantial number of CMKM shares NevWest received and was asked to sell for JE’s accounts, and the significant amount of sales proceeds resulting therefrom, should have prompted NevWest to conduct a searching inquiry to ensure that CMKM was complying with relevant laws and regulations. For example, NevWest failed to conduct a reasonable inquiry to obtain information regarding the number of CMKM shares issued to JE, and specific details concerning how and when JE acquired his CMKM shares, in order to comply with minimum standards imposed on broker-dealers to prevent and detect violations of the federal securities laws and to ensure that the firm met its continuing responsibility to know both its customer and the securities being sold.
41. During the relevant period, NevWest, acting through Santos and Rumyantsev, was aware or should reasonably have been aware of public information including, without limitation, the following:
a. CMKM’s 10-QSB filing with the Securities and Exchange Commission (“SEC”), dated November 18, 2002, showed the address of the principal executive office as 7500 West Meade Boulevard, Suite 9627, Las Vegas, Nevada 89128; and telephone number [phone]. JE used this address and phone number on many of the new
15
account documents at NevWest. This address is a UPS postal box located within about six miles of NevWest’s offices.
b. CMKM’s 10-QSB filing with the SEC, dated November 18, 2002, was signed by IM. IM appears on several of JE’s trust documents provided to NevWest as part of the new account documentation. During relevant times to the complaint, IM was the former President, director and shareholder of CMKM, and IM also acted as the Registered Agent on behalf of CMKM.
c. CMKM’s last 10-QSB filing with the SEC, dated November 18, 2002, showed that for the quarter ending September 2002, CMKM reported total assets of $344.00, all in cash, and total liabilities of $1,672.00.
d. CMKM did not file any annual reports on Form 10-KSB with the SEC for its fiscal years ending December 31, 2002, 2003, and 2004.
e. CMKM did not file any quarterly reports on Form 10-QSB since November 18, 2002, and therefore, did not file quarterly reports for the periods ended: March 31, June 30, and September 30, 2003; March 31, June 30, and September 30, 2004; and March 31, 2005.
f. CMKM did not make any SEC filings during the period of July 22, 2003 to February 17, 2005. Consequently, investors did not have any financial information regarding CMKM during the period that NevWest sold over 235 billion shares on behalf of JE’s accounts.
16
g. By September 2004, NevWest should have been aware that it had sold for JE more than 10% of the outstanding shares of CMKM. Specifically, between March 2003 and May 2005, NevWest sold for JE’s accounts, in the aggregate, as many as 36.7% of CMKM’s total outstanding shares.
h. CMKM engaged in a promotional campaign, in, amongst other places, Nevada, designed to raise interest in its stock. CMKM sponsored a NHRA funny car. The car is called the CMKXTREME vehicle. Promotional items such as T-shirts and hats with “Got CMKX?” written on the front were handed out at race events. All of this activity was used to encourage investors to purchase shares of CMKM through trading activity on the pink sheets.
i. The Securities and Exchange Commission (“SEC”) temporarily suspended over-the-counter trading of CMKM securities for the period of March 3, 2005 through March 16, 2005. Further, on May 10, 2005, the SEC commenced an administrative hearing against CMKM pursuant to Section 12(j) of the Securities Exchange Act of 1934 to revoke the registration of each class of securities of CMKM. Despite the aforementioned events, NevWest, from March 17, 2005 through May 11, 2005 continued to sell at least 22.5 billion shares of CMKM for JE’s accounts in approximately 77 transactions. On or about July 12, 2005, an Administrative Law Judge issued an administrative decision in the SEC’s action revoking the registration of each class of
17
securities of CMKM. This decision became final on or about October 28, 2005.
j. Prior to selling JE’s CMKM shares, NevWest, acting through Santos and Rumyantsev, knew or should have known that JE had liquidated through NevWest a substantial amount of shares in other low-priced and penny stock certificates in at least two entities, Pinnacle Business Management, Inc. which later became Serac Holdings Inc. (“Pinnacle”), and Barrington Foods (“Barrington”), which later became U.S. Canadian Minerals, Inc. (“UCAD”). Between February 20, 2003 and February 19, 2004, JE deposited almost 6 billion shares of Pinnacle stock with NevWest. In May 2002, the SEC temporarily suspended trading in Pinnacle’s securities and filed fraud charges against the company. On or about July 6, 2004, the SEC revoked Pinnacle’s securities registration. Between February 2003 and December 2004, JE deposited 6.2 million shares of securities issued by Barrington Foods at NevWest. In October 2004, the SEC temporarily suspended trading in this security.
42. The foregoing acts, practices and conduct constitute separate and distinct violations of NASD Conduct Rules 3011 and 2110 by NevWest, Santos, and Rumyantsev and MSRB Rule G-41 by NevWest.
18
SECOND CAUSE OF ACTION
(IMPROPER RELEASE OF FUNDS FROM ESCROW BANK ACCOUNT –
Violation of SEC Rule 15c2-4 and NASD Conduct Rule 2110
Respondents – NevWest and Santos)
Ascendant Select Fund I, LLC Offering
43. The Department realleges and incorporates by reference paragraphs 1 through 12 above.
44. Between February 15, 2004 and July 2004, NevWest, acting through Santos, participated in a distribution of securities for the sale of 5 million units in Ascendant Select Fund I, LLC (“ASF”). The ASF private placement memorandum (“ASF Memorandum”) represented that the offering was contingent on raising a minimum of $500,000 and a maximum of $50 million on a best efforts “part or none” basis.
45. ASF was a Nevada limited liability company with Ascendant Partners MM, Inc. (“APM”) acting as the managing member of ASF. APM’s officers and directors included Santos, VH and DR. The ASF Memorandum identified various affiliates of the APM that included: OneCap; NevWest doing business as OneCap Securities; and OneCap Real Estate Fund I. The ASF Memorandum also listed the officers and directors of OneCap as follows: VH was the president, chief executive officer, and director; and Santos was a director.
19
46. The ASF Memorandum represented that the offering was contingent on raising a minimum of $500,000 from non-affiliates on or before February 15, 2005. The ASF Memorandum further represented that: a) all funds received would be held in an escrow account; and b) if the minimum of $500,000 was not raised from sales of securities to non-affiliates by February 15, 2005, all funds would be refunded to investors together with interest.
47. From April 12, 2004, to May 12, 2004, NevWest, acting through Santos, sold units in ASF to two investors totaling $500,000 as follows: $250,000 was raised from one member of the public; and $250,000 was raised from OneCap, an investor that was affiliated with both APM and NevWest. NevWest, pursuant to an escrow agreement, deposited all investors’ funds into a segregated bank account in ASF’s name. The escrow agreement did not accurately reflect that the minimum contingency amount of $500,000 was to be raised from sales of securities to non-affiliates.
48. Despite not having met the minimum contingency amount through sales of securities in bona fide transactions to non-affiliated investors, on May 17, 2004, Santos released contingency proceeds totaling $500,000 from the ASF escrow bank account as follows: $495,000 was disbursed to ASF and $5,000 was disbursed to NevWest. NevWest raised additional funds totaling $250,000 from two non-affiliated investors by July 21, 2004. Therefore, NevWest, acting through Santos, failed to properly escrow purchasers’ funds in a segregated account from May 17, 2004 until the minimum contingency amount was satisfied on July 21, 2004.
49. The foregoing acts, practices and conduct constitute separate and distinct violations of SEC Rule 15c2-4 and NASD Conduct Rule 2110 by NevWest, and NASD
20
Conduct Rule 2110 by Santos.
THIRD CAUSE OF ACTION
(FAILURE TO COMPLY WITH CONTINGENCY OFFERING TERMS –
Violation of SEC Rule 10b-9 and NASD Conduct Rule 2110
Respondents – NevWest and Santos)
Ascendant Select Fund I, LLC Offering
50. The Department realleges and incorporates by reference paragraphs 1 through 12, and 43 through 49, above.
51. As more fully described in paragraphs 43 through 49, NevWest, acting through Santos, caused the release of investors’ funds to the control of ASF and NevWest before satisfaction of the contingency to sell the minimum amount of securities through bona fide transactions, to non-affiliated investors, thereby rendering the representations in the ASF Memorandum false and misleading.
52. The foregoing acts, practices and conduct constitute separate and distinct violations of SEC Rule 10b-9 and NASD Conduct Rule 2110 by NevWest and Santos.
FOURTH CAUSE OF ACTION
(IMPROPER RELEASE OF FUNDS FROM ESCROW BANK ACCOUNT –
Violation of SEC Rule 15c2-4 and NASD Conduct Rule 2110
Respondents - NevWest and Santos)
PracticeXpert, Inc. Offering
53. The Department realleges and incorporates by reference paragraphs 1 through 12.
21
54. Between October 8, 2003 and January 26, 2004, NevWest, acting through Santos, participated in a distribution of securities for the sale of 6 million shares of common stock of PracticeXpert, Inc. (“PXPT”) at a price of $0.50 per share. The PXPT private placement memorandum (“PXPT Memorandum”) represented that the offering was contingent on raising a minimum of $50,000 and a maximum of $3 million on a “best efforts basis.”
55. The PXPT Memorandum further represented that: a) all subscription funds received would be held in an escrow account in compliance with SEC Rule 15c2-4; and b) no funds would be released to PXPT until the offering raised a minimum of $50,000. The PXPT Memorandum further provided that if the minimum offering amount had not been raised within 90 days of October 8, 2003, all subscription funds would be returned to investors without interest or deduction of fees. Under the terms of the PXPT Memorandum, PXPT had the option to extend the contingency offering period from 90 to 180 days.
56. The PXPT Memorandum represented that “[n]o person associated with the Company [PXPT] intends to participate in the distribution of the Offering.” Further, the PXPT Memorandum failed to disclose that PXPT’s officers and directors would be purchasing shares of the offering, including the maximum amounts of such investments, and that the proceeds of their participation would be counted towards fulfilling the minimum contingency amount.
57. From November 18, 2003 through December 23, 2003, NevWest and PXPT collectively raised $51,000 from five investors as follows: $36,000 was raised from two public customers; and $15,000 was raised from three investors that were each
22
officers and directors of PXPT. Pursuant to an escrow agreement signed by Santos on behalf of NevWest, investors’ funds were deposited into a segregated bank account in PXPT’s name on January 22 and January 23, 2004.
58. Despite not having satisfied the minimum contingency amount through sales of units in bona fide transactions, on January 26, 2004, NevWest caused the release of $51,000 from the escrow bank account as follows: $47,430 was disbursed to PXPT; and $3,570 was disbursed to NevWest as commissions due for acting as the placement agent for the offering. Consequently, NevWest failed to properly escrow purchasers’ funds in a segregated account until the minimum contingency amount was satisfied through the sale of bona fide transactions from investors that were not affiliated with PXPT. After the release of purchasers’ funds from escrow on January 26, 2004, NevWest neither acted as the placement agent nor participated in the PXPT offering to raise any additional funds.
59. The foregoing acts, practices and conduct constitute separate and distinct violations of SEC Rule 15c2-4 and NASD Conduct Rule 2110 by NevWest, and NASD Conduct Rule 2110 by Santos.
FIFTH CAUSE OF ACTION
(FAILURE TO COMPLY WITH CONTINGENCY OFFERING TERMS –
Violation of SEC Rule 10b-9 and NASD Conduct Rule 2110
Respondents – NevWest and Santos)
PracticeXpert, Inc. Offering
60. The Department realleges and incorporates by reference paragraphs 1 through 12, and 53 through 59, above.
61. As more fully described in paragraphs 53 through 59, NevWest caused the
23
release of investors’ funds to the control of PXPT and NevWest before satisfaction of the contingency to sell the minimum amount of securities through bona fide transactions, thereby rendering representations in the PXPT Memorandum false and misleading.
62. The foregoing acts, practices and conduct constitute separate and distinct violations of SEC Rule 10b-9 and NASD Conduct Rule 2110 by NevWest and Santos.
SIXTH CAUSE OF ACTION
(FAILURE TO TIMELY COMPLY WITH REPORTING REQUIREMENTS –
Violation of NASD Conduct Rules 3070 and 2110
Respondents – NevWest and Santos)
63. The Department realleges and incorporates by reference paragraphs 1 through 12 above.
64. From February 28, 2003 to August 27, 2004, NevWest, acting through Santos, failed to timely report six written customer complaints to NASD as statistical and summary information by the 15th day of the month following the calendar quarter in which the customer complaints were received by the firm, in violation of NASD Conduct Rule 3070(c). NevWest reported the customer complaints to NASD approximately 134 to 500 days late.
65. From July 26, 2004 to September 7, 2004, NevWest, acting through Santos, failed to timely report the existence of two conditions that required disclosure within ten business days after the firm knew or should have known of the existence of the conditions, in violation of NASD Conduct Rule 3070(b). NevWest was required to report that the following conditions occurred under Conduct Rule 3070(a): 1) the State of New Hampshire denied a registered representative’s registration; and 2) the SEC named a registered representative as a defendant in a civil action. NevWest reported the existence
24
of the conditions to NASD approximately 13 to 18 days late.
66. The foregoing acts, practices and conduct constitute separate and distinct violations of NASD Conduct Rules 3070 and 2110 by NevWest and Santos.
SEVENTH CAUSE OF ACTION
(SUPERVISION –
Violation of NASD Conduct Rules 3010 and 2110
Respondents - NevWest and Santos)
67. The Department realleges and incorporates by reference paragraphs 1 through 12, and 43 through 66, above.
68. NASD Rule 3010(a) requires that each firm establish and maintain a system to supervise the activities of each registered representative, registered principal, and associated person that is reasonably designed to achieve compliance with applicable securities laws and regulations, and with the Rules of NASD.
69. NASD Rule 3010(b) requires that the firm establish, maintain, and enforce written procedures to supervise the types of business in which it engages and to supervise the activities of each registered representative, registered principal, and associated person in a manner that is reasonably designed to achieve compliance with applicable securities laws and regulations, and with the Rules of NASD.
70. At all times relevant to the complaint, Santos, as the firm’s Chief Compliance Officer, was responsible for ensuring that NevWest establish and maintain an effective supervisory system, including adequate written supervisory procedures, that was reasonably designed to achieve compliance with the federal securities laws and rules, and Rules of NASD. Moreover, at all relevant times herein, NevWest’s procedures required that Santos supervise the firm’s activities relating to contingency offerings.
25
Supervision Relating to Contingency Offerings
71. Between October 2003 and July 2004, NevWest, acting through Santos, engaged in the business of raising money in connection with two contingency offerings sold through private placement memoranda. As more fully described in paragraphs 43 through 62 above, NevWest released purchasers’ funds from escrow bank accounts to the control of the issuers before the contingencies were satisfied through sales of securities in bona fide transactions, thereby rendering representations in the respective private placement memoranda false and misleading.
72. NevWest’s supervisory system and written supervisory procedures relating to contingency offerings did not: i) require the firm to monitor and verify that the minimum contingency amount has been satisfied through sales of securities in bona fide transactions, prior to releasing the purchasers’ funds from the escrow bank account and to the control of the issuer; ii) address what steps the firm would take if NevWest determined that issuers were not complying with SEC Rules 15c2-4 and 10b-9; iii) specify the process and procedures the firm should follow to notify the escrow agent when the contingency offering terms have been satisfied; and iv) designate a specific principal at the firm to determine whether or not the contingencies have been satisfied and to provide notification to the escrow agent to release the purchasers’ funds from the escrow bank account to the control of the issuer.
Supervision Relating to Reporting Requirements
73. Between February 2003 and September 2004, NevWest was required to file certain reports relating to customer complaints and disclosure events with NASD pursuant to NASD Conduct Rule 3070. As more fully described in paragraphs 63
26
through 66 above, NevWest failed to timely file quarterly reports of statistical and summary information and reports regarding the existence of disclosure events.
74. NevWest failed to establish an effective supervisory system and adequate written supervisory procedures reasonably designed to achieve compliance with NASD Conduct Rule 3070, in that they did not designate a specific person with the responsibility to: i) review customer complaints and disclosure information on a monthly and a quarterly basis, and ii) timely file the reports with NASD as required by NASD Conduct Rule 3070.
75. The aforementioned acts, practices and conduct constitute separate and distinct violations of NASD Conduct Rules 3010 and 2110 by NevWest and Santos.
PRAYER
WHEREFORE, the Department respectfully requests that the Panel:
A. order that one or more of the sanctions provided under NASD Rule 8310(a) be imposed, including that the Respondents be required to disgorge fully any and all ill-gotten gains and/or make full and complete restitution, together with interest; and
B. order that Respondents bear such costs of proceedings as are deemed fair and appropriate under the circumstances in accordance with NASD Rule 8330.
NASD DEPARTMENT OF ENFORCEMENT
Date: September 21, 2006
Jill L. Jablonow
Senior Regional Attorney
Lewis Taylor Egan, Regional Chief Counsel
27
NASD Department of Enforcement
300 S. Grand Avenue, Suite 1600
Los Angeles, CA 90071
[phone]; Fax: [phone]
NASD DISTRICT DIRECTOR OF COUNSEL
Joseph M. McCarthy, Associate Vice Rory C. Flynn, Of Counsel
President & Acting District Director NASD Department of Enforcement
NASD, District 2 1801 K Street, N.W., Suite 800
300 South Grand Ave., Suite 1600 Washington, D.C. 20006
Los Angeles, CA 90071 (202) 974- 2974; Fax: [phone]
Mark P. Dauer, Of Counsel
NASD Department of Enforcement
1100 Poydras Street,
Energy Center, Suite 850
New Orleans, LA 70163
[phone]; Fax: [phone]
28

[fung_derf]

The letter from Frizzell to Stocklein, perhaps the truth is coming....

Dear Don:

In several of our conversations you have reminded me that you are the attorney for CMKM Diamonds, Inc. and that your representation does not necessarily involve representation of any particular officer or director individually. I am writing this letter to you as the attorney for CMKM Diamonds, Inc. By prior press releases, it is the understanding of most of your shareholders that Mr. Maheu and Urban make up the current board of directors. I would ask that the contents of this letter be conveyed to them for action by the company.
To comply with the requirements of the Nevada statutes and the appropriate Federal statutes, I am making a request for certain legal action to be taken by the company at the request of numerous shareholders that owned stock during all relevant times in 2004. Many of the shareholders have owned stock (and still continue to do so) since 2001. In 2004 over 600 billion shares of CMKM Diamonds, Inc. common stock was issued by the company. The issuance of these shares caused significant dilution of
the shareholders stock. The stock has not yet recovered from the effects of this dilution.
Many of the company shareholders have been involved in the investigation of the transactions that led to the issuances of stock last year in such large quantities. On behalf of the above mentioned shareholders I suggest that certain third parties have committed acts that give rise to legal liability to the company.

John Michael Edwards-A review of one complaint filed with the SEC shows that Mr. Edwards was instrumental in obtaining some early financing of the company's activities. Mr. Edwards has been identified as an individual that opened in excess of 36 trust accounts at Nev West Securities since his involvement with the company. Certificates have been issued to an additional 20 companies that have addresses in Langley, B.C. which are purportedly owned or controlled by John Edwards. All addresses have been traced to mail drops as opposed to physical addresses in both Las Vegas and Langley, B.C. Records show that company began issuing stocks to Mr.


1






Edwards trusts as early as 2002. Mr. Edwards used his personal social security number
in setting up these accounts and he was named as trustee in all of the subject accounts.
It is clear through the company's master shareholder list that these trust accounts
were the vehicle for dumping hundreds of billions of shares onto the market. Many of
these shares were restricted shares and should never have been dumped on the market.
This dumping occurred at a time when the company was conveying good news about the
company's progress to the innocent but unknowing public. Recently it was learned that
Mr. Edwards had amassed 2 billion dollars worth of Crown Financial stock. Crown
Financial was one of the most active market makers of CMKX stock when hundreds of
billions of shares of stock were suddenly dumped on the market. There is evidence that
portions of the funds from the sale of these securities were returned to the company
and/or some of the company insiders via wire transfers and other deposits. It is my
opinion that certain portions of the documents I have received from the SEC investigation
are confidential and I am not free to disclose certain documents, including banking
records which I have in my possession, to my clients. I am obligated however to direct
you to the records which you received as well for purposes of this "shareholder derivative
rights" letter.
The case law regarding the requirements of this "shareholder derivative rights"
demand letter is very clear. I must be specific in my demands on the company as to
which actions the shareholders would like the company to pursue. In this regard, as you
have now had the opportunity to scrutinize all bank accounts of the company and stock
issuances as a part of your ongoing efforts to have the company's financial reports
audited, we request that the company pursue Mr. Edwards for his breach of the insider
trading rules and any other securities violation to which you are aware of. Specifically,
the company should seek disgorgement of any short swing profts made by Mr. Edwards
based on his trading activities. The company should seek cancellation of each and every
CMKX share that is now outstanding and currently being held by Mr. Edwards or any of
his companies or trusts.
Some shareholders have contacted principals in at least two of the companies
bearing the trusts principal's names and owners of the companies bearing the trust names
disclaim any knowledge of the transactions in which billions of shares of CMKX stock
were sold pursuant to the instructions of Mr. Edwards. The application page which was
obtained by Nev West at the opening of these trust accounts indicates that most of these
trusts had assets in excess of $1,000,000. If in fact, these trusts were used as vehicles to
sell stock in violation of securities law, your shareholders would request that the
company seek reimbursement for all sales and any consequent gains from the trusts that
were used in this manner. The net effect of these actions could result in potentially
millions of dollars of recovery which could be used by the company to further its drilling
operations.
It is my understanding that Mr. Edwards has been in attendance at several meetings in which the progress of an audit was being discussed. Notes from the auditor suggest that Mr. Edwards had the complete stock book in his possession in January of this year. Although the shareholders do not know why Mr. Edwards would be in possession of the CMKX stock book, it seems clear there is cause for investigation on behalf of the company as to the propriety of such acts. I would also direct your attention to a wire transfer dated July 28, 2004 from a PA Holdings, Inc. account.

The shareholders hereby request that all appropriate claims which may be asserted against Mr. Edwards be instituted at this time.
The shareholders are aware of Mr. Edwards' refusal to testify by deposition at the administrative hearing. If Mr. Edwards should continue the assertion of his fifth amendment rights in any action brought by the company, the company could seek rulings from the Court which would assist them in obtaining a favorable outcome of any action.

Nev West Securities- It has been proven by the records you and I have received from the SEC that Nev West Securities has allowed John Edwards to open at least 36 trust accounts to trade securities. The company issued stock certificates to Mr. Edwards companies and trusts totaling hundreds of billions of shares in 2003, 2004 and 2005. Once the sale of these massive amounts of CMKX stock were concluded, checks were issued and funds were wired from Nev West to various accounts at the direction of John Edwards. The company should investigate these activities to determine the complicity of Nev West in the massive dilution and improper trading activities in its company stock. I have been told there has been a full NASD investigation and we request that that company seek full discovery of any such investigation.
I have requested from you the DTCC records regarding the trading in CMKX stock and would renew that request at this time on behalf of the company shareholders. You are aware that significant naked shorting of CMKX stock has occurred and the company is hereby requested to assist in the investigation to determine those that may be responsible for the illegal shorting and fails to deliver that are present in this stock. It is believed that Nev West facilitated the naked shorting of CMKX stock. The DTCC records are crucial in following the trail of the naked short transactions.
There is a group of CMKX shareholders that contacted Nev West earlier this year after learning there was a large amount of stock available for sale. This group of shareholders contacted Nev West directly and purchased a large block of CMKX stock. Immediately upon the purchase of a large block of stock, the Nev West agent began to run the stock down to the purchasers, alienating several shareholders. It is clear that Nev West has been a facilitator in the dilution of CMKX stock.

Neil Levine- The shareholders request that legal action be taken against Neil
Levine and the accounting firm of Bagell, Josephs and Company. Testimony by Mr.
Levine at the administrative hearing confirms that Neil Levine was brought in to perform
the audit by John Michael Edwards. Notes from Mr. Levine and testimony at the hearing
also confirm that Mr. Edwards was in possession of the stock book and actually attended
the first meeting between the company and the auditors. Mr. Levine admitted to his prior
association with Mr. Edwards because of other work he had performed for Mr. Edwards.
The company received an unwelcome surprise on the day before the important
administrative proceeding was to begin. Mr. Levine stated that he was too busy with
other companies and was terminating his relationship with CMKM Diamonds, Inc. We
acknowledge that the company was having difficulty in gathering information needed by
Mr. Levine, but his abrupt termination at such a critical time most likely constituted
professional negligence. Mr. Levine's relationship with the person most involved in
diluting the company renders his stated reason for abandoning the company suspicious at
best.

Although Mr. Levine accepted funds to perform his due diligence and did in fact perform due diligence on the company, he opted to withdraw without warning on the day before the hearing. At the very minimum, the auditing firm should be requested to return any unaccounted for pre-paid fees. As company attorney, you are in a better position to know the merits of any legal claims that may be brought by the company against Bagell
and Josephs and Company and/or Neil Levine for its dealings with CMKM Diamonds, Inc. The evidence of Mr. Edwards massive sell off of CMKX stock should be reason to bring legal action against Mr. Levine on behalf of the company.

David Desormeau- A press release dated December 3, 2002 touted the hiring of
David Desormeau to institute a real time financial reporting and inventory control
system. The press release indicated that his system was capable of producing daily
drilling logs, field reports, core sampling data, product expenditures and other features.
This hiring was ostensibly to coordinate the new financial accounting system to insure
seamless integration with newly enacted Securities and Exchange Commission auditing
practices for public companies. David Desormeau was named Treasurer on January 7,
2003. He has been referred to on many occasions as the Chief Financial Officer of
CMKM Diamonds, Inc.
The shareholders request that the company file suit against Mr. Desormeau for professional negligence. Since the company's hiring, Mr. Desormeau has not instituted the system which was touted on his hiring. There has never been a financial report filed with the SEC since Mr. Desormeau's hiring. It is clear from the written communications between Mr. Desormeau and Neil Levine, that Mr. Desormeau did not have adequate records of the company. It now appears that Mr. Desormeau's failed accounting system is at least one of the reasons the company has been unable to fle its required financials.
Of even greater concern than the inadequate bookkeeping is Mr. Desormeau's
trading activities and payments for his services. Ms. Buck testified on page 347 of the
administrative hearing transcript that Mr. Desormeau had been paid $1,500,000 in stock.
My investigation shows that 63 billion shares were issued to Business Works (a company
owned by Mr. Desormeau) at a time when the company was promoting its stock through
press releases about its diamond finds. I have reviewed bank records which show cash
payments from Mr. Casavant to David Desormeau for $49,500 from June 10, 2004
through August 18, 2004. As you know, I only received a few select bank statements of
various company accounts. The business address for Business Works is 6300 Mowbray Ct, Henderson, Nv. This is also the resident address of David Desormeau. Business Works is also the registered agent for several other companies that have been identified as receiving billions of shares of stock. Specifically, the company should seek disgorgement of any short swing profits made by Mr. Desormeau based on his trading activities. The company should seek cancellation of each and every CMKX share that is now outstanding and currently being held by Mr. Desormeau or any of his companies.
James Kinney- James Kinney was identified as being a consultant to CMKM Diamonds, Inc. in an S8 fling by the company on April 15, 2003. Mr. Kinney was paid 530,000,000 shares valued at $265,000 for a 6 month consulting contract for his expertise in zinc claims. Although Mr. Kinney is never mentioned in any other filings with the commission as an officer, employee or board member, Mr. Kinney, and companies under

his control such as Part Time Management, Inc., were issued nearly 100 billion shares of CMKX stock in less than 10 months from late 2003 to 2004. You have now had the
benefit of seeing all the bank statements and stock issuance records. You have also seen the company bank accounts with the documentation of the wire transfers as part of your efforts in gathering records for fnancial audits. The shareholders are requesting that you
take action on behalf of the company if these records show unlawful trades which were
conducted by insiders resulting in dilution of company stock. Specifically, the company
should seek disgorgement of any short swing profits made by Mr. Kinney based on his
trading activities. The company should seek cancellation of each and every CMKX
share that is now outstanding and currently being held by Mr. Kinney or any of his
companies.
Ginger Gutierrez- Ginger Gutierrez has maintained mostly clerical positions
with the company. Her signature appears on many checks written from CMKXtreme
account. There are also checks written out to Silver State Bank for cashier's checks
which ultimately were endorsed by Ginger Gutierrez. Ms. Gutierrez is listed as secretary
and treasurer of Part Time Management, Inc. Beginning in August of 2003 through
October of 2004, Ms. Gutierrez transferred 23 billion shares of CMKX stock personally
in addition to the stocks that were issued to Part Time Management, Inc. Specifically, the
company should seek disgorgement of any short swing profits made by Ms. Gutierrez
based on her trading activities. The company should seek cancellation of each and every
CMKX share that is now outstanding and currently being held by Ms. Guitierrez or any
of her companies.
Brian Dvorak- The shareholders have been presented with evidence that numerous opinion letters were written by Brian Dvorak which resulted in free trading shares of CMKX stock. The evidence suggests Mr. Dvorak incorrectly issued opinions which resulted in legends being removed or authorized free trading of shares when in fact, such shares should have been restricted and subject to certain holding periods. I have personally viewed some cancelled checks from PA Holdings, Inc. and CMKXtreme, Inc. signed by Urban Casavant payable to Brian Dvorak totaling over $72,000 during the months of June, July and August of 2004. A check with the Nevada Secretary of State records reveals PA Holdings, Inc. is a Nevada corporation with the President, Secretary and Treasurer as Brian Dvorak. You have reviewed many documents supporting the issuances of stock such as the board resolutions. I am assuming you have reviewed the opinion letters issued by Mr. Dvorak. The shareholders have not seen evidence that there has ever been a 100 for 1 forward split. It appears stock issuances referring to a 100 for 1 forward split were supported by Mr. Dvorak's opinion letters, yet stock was issued to only a select few. If there is a logical explanation for this issuance of stock, please advise. The shareholders request that you take legal action against Brian Dvorak for any occurrences of legal malpractice which have caused company stock to be freely traded in the market, when such should not have occurred.

Finally, you are the one person who has unfettered access to all records of the company and the most likely person with the ability to obtain any missing records. When Mr. Maheu was brought on as Chairman of the Board, he entrusted you with the job of getting the company in good financial reporting shape. You have seen two auditors bail out after being paid substantial sums of money. One auditor has notified the SEC of serious improprieties found during the attempted audit of CMKM Diamonds, Inc. If your work has uncovered any acts that may warrant legal action on behalf of the company, the
shareholders request that you take any and all action that you deem necessary on behalf of the company. This obviously puts you in an awkward position, and for that I
apologize. You have been very up front with me in every aspect of your representation of the company. I look forward to continue our working together on behalf of the shareholders. I am optimistic that pursuing some of the above mentioned claims will be beneficial to the company and ultimately to the shareholders.

The list of actions we are requesting that the company take are based on documents which have been given to me in these proceedings. The shareholders have performed much due diligence on the company's dealings and relationships because they have received no information of substance on the company's operations in over a year. Maybe the bright lights of litigation will help illuminate some of the reasons this company stock has been diluted and shorted. This list does not purport to be a complete and final list of actions that the shareholders deem to be warranted. In accordance with the requirements of Nevada law and Federal Rules of Procedure, we will notify you of any additional acts the shareholders deem necessary.

Please present these matters to Urban and Mr. Maheu for consideration. The cases which I have found interpreting the relevant statutes do not suggest a specific time period within which to request action. I will look forward to your response within 30 days from today. If after due consideration of the shareholders' request, the company believes in its best judgment, that the actions we are seeking are not justified, please so advise. Call me if you have any questions or concerns about this request.



sincerely,


Bill Frizzell
Attorney f r John Martin and the CMKX Owners Group





http://cmkxownersgroup.com/ShareholderDerivativeLetter.pdf

[fung_derf]

The discovery of John Edwards and his share sales...


NASD Charges NevWest Securities Corporation and Principals with Violating Anti-Money Laundering Rules

Firm Failed to File Suspicious Activity Reports Despite Suspicious Sales Of Hundreds of Billions of Shares of Sub-Penny Stock by Customer



Washington, D.C. — NASD announced today that it has charged NevWest Securities Corporation of Las Vegas and two of its top officers - President Sergey Rumyantsev and Vice President Antony M. Santos - with violating NASD's Anti-Money Laundering Rule.

In its complaint, NASD charges that the firm failed to adequately implement and enforce procedures to detect and report suspicious transactions that the firm had reason to suspect involved possible securities fraud. Specifically, the complaint charges that the firm failed to conduct adequate due diligence and file appropriate Suspicious Activity Reports (SARs) in connection with highly suspicious transactions by a customer of the firm. NASD alleges that, during the relevant period, the customer opened 32 accounts at NevWest and sold more than 250 billion shares of a sub-penny stock, which generated total sales proceeds of over $53 million. NASD alleged that NevWest earned commission revenue on the sales totaling $2.5 million - 36 percent of the firm's total revenues during the relevant period.

"Suspicious Activity Reports provide law enforcement with information that's critical for investigating and prosecuting money laundering, terrorist financing and other financial crimes," said James S. Shorris, NASD Executive Vice President and Head of Enforcement. "Broker-dealers have an obligation to investigate 'red flags' indicating suspicious activity and, where appropriate, to file SARs. Despite a multitude of very obvious red flags, NevWest chose to look the other way, earning millions for itself in the process."

NASD's complaint charges that between January 2003 and May 2005, NevWest, through Rumyanstev and Santos, failed to adequately perform due diligence, file SARs or cease trading in multiple accounts controlled by one of NevWest's customers in connection with more than 500 sale transactions. The transactions involved a sub-penny stock issued by CMKM Diamonds, Inc. (CMKM) that traded in the Pink Sheets until the Securities and Exchange Commission (SEC) revoked the stock's registration in 2005. The complaint further charges that the firm and its officers ignored numerous red flags which reasonably should have caused them to suspect that the customer was violating federal securities laws. The complaint charges that the firm should have filed suspicious activity reports with the U.S. Treasury Department's Financial Crimes Enforcement Network (FinCEN).

Those red flags included:

* The massive volume of CMKM stock that was being sold through NevWest by this customer, which constituted as much as 36.7% of CMKM's total outstanding shares;

* Publicly available information about CMKM's financials indicating that CMKM had almost no assets. CMKM's last quarterly report, filed with the SEC on Nov. 18, 2002, showed that for the quarter ending September 2002, it had total assets of only $344 cash and total liabilities of $1,672;

* CMKM's failure to file annual reports with the SEC for the fiscal years 2002, 2003 and 2004.

* Information showing a relationship between the NevWest customer engaging in the suspicious transactions and a former officer of CMKM;

* The SEC's temporary suspension of over-the-counter trading in CMKM securities from March 3, 2005 through March 16, 2005 and the SEC's action on May 10, 2005 to revoke the registration of each class of CMKM stock. From March 17, 2005 until May 11, 2005, NevWest continued to sell at least 22 billion shares for its customer's account.

NASD also alleges that NevWest, through Santos, failed to comply with escrow account requirements and contingency offering terms, in violation of the federal securities laws and NASD rules; failed to timely report customer complaints and disclosure events pursuant to NASD rules, and failed to establish and maintain a supervisory system and procedures that were reasonably designed to detect and prevent these violations.

Under NASD rules, a firm or individual named in a complaint can file a response and request a hearing before an NASD disciplinary panel. Possible remedies include a fine, censure, suspension, or bar from the securities industry, disgorgement of gains associated with the violations, and payment of restitution. The issuance of a disciplinary complaint represents the initiation of a formal proceeding by NASD in which findings as to the allegations in the complaint have not been made and does not represent a decision as to any of the allegations contained in the complaint. Because this complaint is unadjudicated, interested persons may wish to contact the respondent before drawing any conclusions regarding the allegations in the complaint.

Investors can obtain more information about, and the disciplinary record of, any NASD-registered broker or brokerage firm by using NASD's BrokerCheck. NASD makes BrokerCheck available at no charge to the public. In 2005, members of the public used this service to conduct more than 4.3 million searches for existing brokers or firms and requested more than 194,000 reports in cases where disclosable information existed on a broker or firm. Investors can link directly to BrokerCheck at www.nasdbrokercheck.com. Investors can also access this service by calling [phone].

NASD is the leading private-sector provider of financial regulatory services, dedicated to investor protection and market integrity through effective and efficient regulation and complementary compliance and technology-based services. NASD touches virtually every aspect of the securities business - from registering and educating all industry participants, to examining securities firms, enforcing both NASD rules and the federal securities laws, and administering the largest dispute resolution forum for investors and registered firms. For more information, please visit our Web site at www.nasd.com.

http://www.nasd.com/PressRoom/NewsReleases/2006NewsReleases/NASDW_017515



http://cmkxownersgroup.com/NevWest%20Complaint.pdf

[fung_derf]

FRIZZELL LAW FIRM
602 S. Broadway
Tyler, Texas 75701
[phone]


Greetings CMKX Shareholders,

This past couple of weeks has been agonizing for many of us around this office. I have been unable to speak with you because of the uncertainty we had about Kevin West’s hiring. I have been waiting for the press release that came out today. Kevin has been hired by CMKM Diamonds, Inc. Kevin told us a couple of weeks ago that he was discussing employment with Urban and other individuals at the company. At the time these discussions began, we mutually agreed that he would not work out of this office until there was a final agreement on his employment with CMKM Diamonds, Inc. Thus, we have not seen Kevin for a couple of weeks. In general terms he has called to tell us his progress relative to this employment change but we are not privy to the details of his hiring.

In my opinion, this is a good day for the shareholders of CMKX stock. I have had the opportunity to work with Kevin for the last 18 months. He is knowledgeable and most importantly he is a dedicated advocate for the shareholder. He is a fast learner and a self starter. He was generally the first to be at work and one of the last to leave. His work at this office went far beyond CMKX matters. He can help the company in many of its challenges.

Hiring Kevin tells me the company is dead serious about the matters that were covered in the last press release of the company. It is clear evidence to me that an interpleader will be filed. It is an indication to me that efforts are being made by the company to have its stock trade again. How long it will take is anyone’s guess, but I believe Kevin will move as quickly as he is allowed to move.

There will be some who will criticize Kevin’s hiring. Some will say this is a stall tactic or another token gesture to appease the shareholder group we have put together. This would be quite an error in judgment on the part of CMKM management if Kevin were hired for such reasons. Kevin and I spent hours discussing many things before Kevin finalized his decision to work for the company. I can promise you that Urban knew how Kevin felt about the plight of the shareholders, before an agreement was reached.

When you work with someone on a daily basis for 18 months, you have a pretty good feel about someone’s ability to handle pressure situations. Kevin gave this job offer a lot of thought before accepting this position. He has every intention of helping the company and the shareholders at the same time.

Kevin may not be Bill Gates or Warren Buffett, but he has a unique ability to calmly analyze troublesome situations and apply common sense solutions. His calm but firm demeanor has helped resolve many disputes. He is not easily swayed once he believes in a course of action. I do not know all the problems facing CMKX, but we all know the obvious ones. Kevin will figure out a way to begin delivering regular information to you. It may take Kevin a while, but I expect you will soon have a phone number to call and a live person you can contact with your questions. Anything Kevin approves in a press release in the future, I will believe until proven otherwise. Why would I make such a statement in light of the last couple of years of CMKX problems? Because Kevin is a man of character and morally sound. He simply has never lived a lifestyle that we often see when corporate greed overtakes the obligations to work in the best interests of the shareholders.

I am hopeful this is the first press release of many to come in the next few months. I do not expect all of you to jump with joy simply because we believe this is good news. I would suggest however that you give Kevin some time to get a handle on the problems. You can then make your own decisions on his ability to get this company back on course. I have been fielding calls lately from various shareholders telling me of their desire to begin legal proceedings against the company. I will not encourage you nor discourage you from pursuing litigation. You make your own decision in that regard. I plan to cooperate in any way I can with Kevin in hopes that the company will take the necessary steps to build this company back.

Kevin knows the shareholders are a group that has endured much frustration and on occasions misdirection. He knows the only way he will get your full support is by positive things occurring under his watch. I hope Urban and any one else that is directing the company will give responsibility and support to Kevin. This is one update that I have really enjoyed writing.



Onward,

Bill

[fung_derf]

CMKX hires a shareholder as new CEO....

(BSNS WIRE) CMKM Diamonds Wishes to Announce New Management
CMKM Diamonds Wishes to Announce New Management

Business Editors

LAS VEGAS--(BUSINESS WIRE)--Sept. 19, 2006--
CMKM Diamonds Inc. has named a shareholder, Kevin West,
as the new Interim Chief Executive Officer of the Company.
Mr. West has worked for the past 18 months in an effort to help
determine those shareholders that are holding viable equity in the
Company. First, through a brokerage statement fax-in campaign
initiated by attorney Bill Frizzell and the CMKX Owners Group, and
then the most recent cert pull conducted on behalf of the
now-dissolved CMKM Task Force. The knowledge gained during this
process will prove invaluable in helping the Company to move forward.
"I would like to welcome Mr. West as an Interim Officer of the
Company," stated a Director and Chairman of the Board, Urban Casavant.
"Mr. Casavant has asked me to help him with the day-to-day
operations of the Company. The details before us are going to require
a bit of time and complete focus to make sure that they are done
correctly," stated Mr. West.
The Company wants to again remind its shareholders not to rely on
any information that has not been disseminated through the use of an
official press release from the Company.

Safe Harbor Statement:

This news release contains certain "forward-looking statements"
within the meaning of Section 27a of the Securities Act of 1933 and
Section 21e of the Securities Exchange Act of 1934. Although the
Company believes the expectations reflected in such forward-looking
statements are reasonable, it can provide no assurance that actual
results will meet or exceed such expectations.

[fung_derf]

A P.R. from the task force.....

CMKM Diamonds Task Force Provides Corporate Update
1/19/2006 3:01:01 PM

LAS VEGAS, Jan 19, 2006 (BUSINESS WIRE) -- CMKM Diamonds Inc. today announced a corporate update to its stockholders by disclosing the following information:

Periodically CMKM intends to provide updates by the Task Force, which has been implemented to distribute assets primarily consisting of 45,000,000 shares of Entourage Mining Ltd. common stock. The Task Force will not be directly responding to questions from CMKM stockholders. Robert A. Maheu, a Task Force Administrator, stated, "The sole purpose of the Task Force is to assist the stockholders of CMKM in obtaining a distribution of the assets of CMKM, pursuant to a Distribution Plan, primarily consisting of the Entourage shares. We are not in a position to and will not speculate on hypotheticals. We are not dealing in the shadows and can assure all CMKM stockholders that all members of the Task Force are working as a united front and are all being provided with the same information."

As to why there has been no news in the past month, the Task Force was awaiting delivery of the share certificate from Entourage, which was received on Thursday, Jan. 12, 2006. The Task Force Administrators were of the opinion that any news relating to the Distribution Plan, without having receipt of the actual assets for distribution, may have sent an improper signal to the stockholders, implying that the assets were in the control of the Task Force.

On Nov. 18, 2005, Entourage Mining Ltd. announced that it had closed the private placement, which was a condition to completing the transaction involving the issuance of an original 50,000,000 shares of Entourage stock to CMKM. Subsequently, as a result of a decrease in the mining claims involved in the original transaction, Entourage unilaterally reduced the number of shares by 5,000,000 shares. (Entourage's press releases can be found on their Web site: www.entouragemining.com.)

In order to be considered a bona fide stockholder of CMKM, a physical stock certificate issued in his/her/its name will need to be presented to the Task Force for confirmation on or before the extended date of March 15, 2006, or as further extended in the sole discretion of the Task Force. It is unlikely that this date will be extended again, unless to provide sufficient opportunity for CMKM stockholders to obtain their certificates from brokerage houses, the DTC, and the Transfer Agent. The Transfer Agent has received numerous requests for certificate transfers and is doing its best to process requests as quickly as possible. The Task Force has asked all stockholders to please be courteous to the Transfer Agent and understand the magnitude of their job at hand. The Task Force is in active communication with the Transfer Agent and is doing everything within their power to assist with an orderly and efficient transfer process.

Electronic and/or other forms of ownership (i.e. - brokerage statements) will not be accepted by the Task Force as evidence of ownership. Therefore, CMKM stockholders who hold their shares in "street name" will need to demand physical certificates from their broker in order to be considered a bona fide CMKM stockholder, and be entitled to their proportionate share of the Entourage common stock and any other assets of CMKM to be distributed to bona fide stockholders.

Stockholder's certificates are only being utilized to verify their entitlement to their percentage of the distribution of CMKM assets, primarily consisting, at this time, of the Entourage stock. A stockholder will retain their CMKM shares upon completion of the verification process. It is currently not possible to estimate how long the verification process will take. Any stockholder, who cannot produce a certificate or does not desire receipt of a distribution, will not receive a distribution of Entourage shares or other CMKM assets. Any assets available for distribution will be proportionately distributed to those stockholders who have complied with the certificate verification process. Urban Casavant, CMKM's sole officer and director, has informed the distribution Task Force that neither he nor his immediate family members will receive any of the Entourage shares in the distribution.

The Task Force was formed solely for the purpose of establishing a Distribution Plan and supervising the distribution of the Entourage shares and other assets of CMKM, if any. The Task Force will not be conducting any due diligence to determine the validity of any other potential assets of CMKM other than those stated above. The Frizzell Law Firm is handling the certificate fax-in program and certificate verification. Because of the significant interest of various stockholder groups, it has been determined by the Task Force to delegate the various activities required to comply with a Distribution Plan. The Distribution Plan has not been finalized at this time.

The Task Force has been apprised of the significant rumors pertaining to the receipt of funds and erroneous agreements reached with brokerage firms short in CMKM's stock. Other than the funds received from Casavant to pay for certain of the costs associated with the Task Force's operations, there have been no funds received from brokers/dealers or any other sources. In addition, none of the Task Force Administrators have been in communication with any firm as to a proposal to cover a failed delivery in CMKM stock. Further, Maheu categorically denies that he has a grandson involved with CMKM, and stated that "anyone purporting to be my grandson and involved with CMKM is not legitimate." Additionally, it should be known that the Stoecklein Law Group is not counsel for CMKM. The Stoecklein Law Group is currently involved only in assisting stockholders in the receipt of their appropriate number of shares of Entourage stock and other assets, if available.

The Task Force has established two fax lines (903-595-5724 and 903-595-5394) where all CMKM stockholders can fax a copy of their certificates to be matched to a certified stockholder list. All CMKM stockholders will need to be identified on or before March 15, 2006, or as further extended at the sole discretion of the Task Force. Once CMKM's stockholders are identified, the Task Force will issue further instructions on how and when distributions will be made.

Lastly, each of the members of the Task Force has received subpoenas from the SEC to produce documents and appear for depositions. It is unclear at this time what impact the SEC will have, if any, on the distribution and operations of the Task Force.

CMKM stockholders are being asked to please refrain from contacting Maheu, the CMKX Owners Group, the Frizzell Law Firm and/or the Stoecklein Law Group. All corporate and Task Force updates will be made in press releases or other forms of distribution media as they become available. The Task Force has established a Web site, www.cmkmtaskforce.com, for posting of corporate updates and other relevant information as and when it becomes available.

SOURCE: CMKM Diamonds Inc.

CMKM Diamonds Inc., Las Vegas
Investor Relations
702-966-6328


Copyright Business Wire 2006

[fung_derf]

and how is this company tied to BTMD?....

http://www.stagfinancialgroup.com/index.html

[fung_derf]

From Treffry......

By: very_tired1
11 Jan 2006, 06:46 PM EST
Msg. 10107 of 10112
(This msg. is a reply to 10106 by fungagain.)
Jump to msg. #
1)How many different penny stocks have you received shares from?

1. 3, all as compensation from CJ for work done for ECNI. None from PCBM, none from ECNI before being hired in Summer of 2002.


2)Have you held all shares, or did you sell? If so, how many shared did you receive? How many sold? How many now holding?

2. Still holding 700K of ECNI/all 305 M of CMKX + more I purchased. I still have 173 M of PCBM as well.

3)How could you be legal counsel for a company and not be aware that slurpy was receiving shares?

3. Surfit never received shares when I was legal counsel for ECNI. Secondly, any shares paid out go through the CEO and TA so long as they fall in number under the authorized and have an opinion letter. I was not the only counsel for ECNI and certainly not their securities counsel, only their litigation counsel in CA and their counsel dealing with corporate debt restructuring.


4)Who is Joan Shapiro and does she actually do anything for these companies, or is she just the receiver of shares for slurpy?

4. Her work for the company, as the work of many employees, was not made aware to me. As far as Surfit, what he did for the company, if anything, I do not know. You saw him on these boards often and your presumpton is that he was paid to promote the stock. That is entirely possible, but I have no knowledge of as I was not made a part of paying anyone for work done.


5)Who was ike? How was catgirl and her family involved with PCBM?

5. Ike was Rebecca from Vegas, a former sh, if I am not incorrect. I do not know who catwoman is (other than the comic book character Selena Kyle) nor do I know her relation to PCBM.

6)What job was slurpy doing to have earned his shares?

6. Your guess as far as "Slurpy" is as good as mine. For example, I was not there when ECNI retained Twin Peaks to do their Webpage, I was not there when ECNI retained the officers, I was not there when ECNI hired a lot of people. It is not a surprise that I was not there when ECNI hired Surfit, if they did. Further, I see that JS's shares were given to her prior to the time of my employment, further supporting the fact I could not have known about it when it occurred.

7)Was it slurpy who put you on OMOG? Why would you listen to him? What other stocks did slurpy put you on?

7. I trusted Ed a lot due to a friendship that went back a couple decades. We knew each other from volleyball and we hung out until I could not hang out with him any longer. I bought OMOG on 2 occasions, lost money on one and got a little back ont he other. As per the usual, a great stock tip was just a BS story and by the time I bought in, the dumping was in process. Not the first and last time I was screwed over. I purchase none of them anymore. As far as other stocks I was put on by Surfit, there were too many to remember. I lost a lot of money on the ones he put me on. I am grateful for other friends and contacts who gave me good tips that helped to cover my losses elsewhere.


8)Why did you go through a period of time where you would blast Turino, then shortly afterward laud him?

8. Why I flip-flopped on Turino? I bought the whole naked shorting BS on PCBM and spoke to LoCastro on a regular basis, who lied to me repeatedly about busting the short. When I woke up and smelled the coffee, I turned on management with as much vigor as I had when supporting them against what I perceived to be bashers. Remember, I received a most unpleasant visitor to my home due to my ragging JT who caught my wife alone at home.... not a pleasant experience. You can rag me for all you want, but remember, I paid a price of real threats against my family for telling the truth that none else here experienced.


9)What's the most amount of aliases you've had at any one time?

9. 4-5 aliases, but only using one at a time. Everytime I would get a new one, the old one would be booted off for language. I would run out of aliases, create 4 or 5 at one time, but only use one at a time when online... so never more than one being used.


10)Is someone paying slurpy or you to post?

10. No one has ever paid me to post a single line, ever. As far as Ed, you will have to talk to him. I have heard rumors that he has, but I have never seen the evidence to prove that he was paid for posting.

11)Does slurpy still live at the same address?

11. I have not dealt with ED for almost 2 years (other than condolence exchanges whem my mother died and when his father died). I have not been to his home for appx. 2 years. Lst I knew he was still in SM, but I do ot know anymore.


12)Is alanc, SBG, jcline, wondrwen, jmcjmc also working with slurpy?

12. I do not know alanc, SBG, wonderwen, jmcjmc from personal interaction (never met them). I have spoken to alanc and wendy, both are genuine people with real lives, not paid touters. AlanC Owns his own real estate comppany is much respected in his community. Wendy lives in Fla and has employment outside of this stock world. I believe neither of them to have ever been paid to taut anything. The other posters you refer to, I have never interacted with on the phone or personally so I could not give you an accurate answer about them.

You state that I finally decided to answer questions. I have been answering them openly for over one year.

As far as me looking awful for 45, thanks for the kind words. You might find that looks in a pic might be deceiving in lieu of reality.

I hope you see that other than legal questions that were beyond my right to discuss, I was open with you. You can rag all day on me for being a dummy in following and investing certain stocks, but then again, several investments turned out well so I am about even to make a general statement. I lost on most of my penny stocks and as a rule, I do not touch them anymore.

Now, I ask you, would I open the doors of information to you if I was not sincere? Are you going to even tell us your name?

[fung_derf]

A lawsuit tie to BTMD?.....

SELLING SECURITY HOLDERS

The following table presents certain information regarding the beneficial
ownership of our shares of common stock, $0.001 par value by the selling
security holders as of August 31, 2004, and the number of shares they are
selling of our common stock covered by this prospectus. None of the selling
security holders has, or within the past three years has had, any position,
office or other material relationship with us, except as noted below.

Acquisition of the Shares

Michael F. Barnett, Sandra H. Barnett, Adam Barnett, Audrey Payne, William
Seminario and Michelle Mertens received their shares of our common stock to
assist with market research and development of our business plan. J. Scott
Sitra, Alfred Delisle and William Perez received their shares of our common
stock to assist us with the preparation and filing of this prospectus. Tom
Rankin and Robert Peterson received their shares of our common stock to assist
with our early stage development and incorporation process. Paragon
Communications, Ltd. received their shares of our common stock to assist us with
the printing and distribution of this prospectus and the printing and
distribution of our common stock certificates.

There are no underlying agreements, understandings (implied or otherwise),
or relationships (other than those disclosed below) concerning the shares
beneficially owned by the selling security holders listed below.

25

SB-2/A 26th Page of 62 TOC 1st Previous Next Bottom Just 26th
· Download Table

Number of
Shares
Beneficially Number of Benefical
Owned Prior Shares Ownership of
Name of to the Being Shares After
Selling Security Holder Offering (1) Offered Offering Percent(2)
----------------------- ------------ --------- --------- ----------


Robert Peterson 300,000 30,000 270,000 1.0%
Tom Rankin 1,245,000 100,000 1,145,000 4.2%
Michael F. Barnett (3) 1,350,000 100,000 1,250,000 4.6%
Sandra H. Barnett (3) 1,325,000 100,000 1,225,000 4.5%
Adam Barnett (3) 1,333,000 1,333,000 -0- *
Paragon Communications, Ltd. 1,250,000 500,000 750,000 2.8%
William Seminario 1,255,000 50,000 1,205,000 4.5%
J. Scott Sitra (4) 575,000 575,000 -0- *
Alfred Delisle (5) 350,000 350,000 -0- *
Audrey Payne 50,000 10,000 40,000 *
William Perez 32,000 10,000 22,000 *
Michelle Mertens 850,000 50,000 800,000 3.0%
--------- --------- ---------
Total 9,915,000 3,208,000 6,707,000

-------------------------
(*) Less than 1%.

(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission and generally includes voting or investment
power with respect to the securities, and includes any shares of common stock
which a person has the right to acquire within 60 days of August 31, 2004.

(2) Based on 27,000,000 total issued and outstanding shares as of August 31,
2004.

(3) Michael F. Barnett, Sandra H. Barnett and Adam Barnett are related as
father, mother, and son, respectively. None of the Barnett claim beneficial
ownership to each others' shares of Pegasus.

(4) J. Scott Sitra is the President, Chief Executive Officer and Board
Member of our affiliate Stag Financial Group, Inc. which owns 2,500,000 shares,
or 9.3%, of Pegasus's issued and outstanding common stock. Although he has
influence over Stag's Board, Mr. Sitra does not claim beneficial ownership of
any of Stag's shares of Pegasus common stock.

(5) Alfred Delisle serves on the Board of our affiliate Stag Financial
Group, Inc. which owns 2,500,000 shares, or 9.3%, of Pegasus's issued and
outstanding common stock. Although he has influence over Stag's Board, Mr.
Delisle does not claim beneficial ownership of any of Stag's shares of Pegasus
common stock.

PLAN OF DISTRIBUTION

We are offering up to 1,000,000 units through our officers and directors on
a "direct participation" basis at a purchase price of $0.25 per unit. Each unit
is comprised of one share of our common stock, $0.001 par value, one warrant to
purchase one share of our common stock at a price of $0.50, and one warrant to
purchase one share of our common stock at a price of $1.00. This offering shall
commence upon effectiveness of this registration statement and will expire
whenever all of the units have been sold or 12 months after the date of
effectiveness, whichever comes first. We are managing this offering without an
underwriter. The units will be offered and sold by our officers and directors.

26

SB-2/A 27th Page of 62 TOC 1st Previous Next Bottom Just 27th

These officers and directors will not receive a sales commission or any other
form of compensation for this offering. In connection with their efforts, our
officers and directors will rely on the safe harbor provisions of Rule 3a4-1 of
the Securities and Exchange Act of 1934. Generally speaking, Rule 3a4-1
provides an exemption from the broker/dealer registration requirements of the
1934 act for associated persons of an issuer. No one has made any commitment to
purchase any or all of the units being offered. Rather, the officers and
directors will use their best efforts to find purchasers for the units. We
cannot predict how many units, if any, will successfully be sold.

Andrew Jones, our President and Chief Executive Officer, and Eric Boyer,
our Secretary and Treasurer, are responsible for the sale of the securities on
behalf of Pegasus. Neither shall be compensated in connection with their
participation by the payment of commissions or other remuneration based either
directly or indirectly on transactions in our securities. Neither of these
officers are considered associated persons of any broker or dealer.

Our officers meet all of the following conditions: .........

http://www.secinfo.com/d17Ns6.12.htm

[fung_derf]

Response to BTMD allegations......

Source: Adam Barnett

Adam Barnett, Chairman of OMDA Oil & Gas, Inc. Addresses Press Release Issued by BioTech Medics, Inc. Dated November 21, 2005
HOUSTON, Nov. 23, 2005 (PRIMEZONE) -- Adam Barnett, Chairman of OMDA Oil and Gas, Inc., responded today to the BioTech Medics, Inc. (Pink Sheets:BTMD) press release issued on November 21, 2005.


In the press release issued by BioTech Medics, Inc., it was stated that OMDA Oil & Gas, Inc. Chairman Adam Barnett was the CEO of OMDA Oil and Gas, Inc. and represented Mr. William Seminario, President of Hamilton Holdings P.A. while entering into a contract and executing a $1 million Promissory Note. Mr. Adam Barnett has never previously and does not currently have any affiliation with Hamilton Holdings P.A. Mr. Adam Barnett has never represented Mr. William Seminario. Mr. Barnett's position within the OMDA Oil & Gas, Inc. organization is solely as Chairman.

In response to the press release issued by BioTech Medics, Inc., Mr. Barnett is discussing with counsel any future action that may be necessary.

CONTACT:
For Adam Barnett
Tipton Jones LLP
Andrew L. Jones, Esq.
214-979-0100 ext. 249
214-303-1812 fax