Heathrow Nat. Food and Bev Inc. (fka HRNF)

[PRmaniac]

“Health Food” Company, CEO Fined by SEC



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The SEC filed charges against a Florida-based penny stock company, Heathrow Natural Food & Beverage Inc., and its CEO Michael Pagnano with defrauding investors after it put out phony press releases proclaiming large sales and fantastic revenue projections.

Meanwhile, the purported health food company had never actually manufactured any of the products it was supposed to have sold, nor did it have any of the distribution agreements with major retail chains that it claimed.

At the time, Pagano was busy prompting the illegal, unregistered distribution of billions of shares of company stock to several people or entities, including himself. He profited by more than $150,000 by selling 877 million of his shares into the market, capitalizing on the phony press releases that boosted public demand for Heathrow stock.

Pagano also is charged with insider trading because he sold his shares while in possession of material nonpublic information about the falsehood of the press releases.

The SEC separately charged New Jersey-based transfer agent Registrar and Transfer Co. (R&T) and its CEO Thomas Montrone with violating the registration provisions of the federal securities laws and failing to supervise firm employees who enabled Heathrow’s unregistered distribution of billions of purportedly unrestricted shares of its stock.

An SEC examination revealed that R&T repeatedly failed to detect and address blatant red flags in connection with more than 54 share issuance requests from Pagnano, including the fact that none of them were accompanied by legal opinions pertaining to the shares to be issued.

In every instance, the shareholder for whom the issuance was requested was not the shareholder covered by the attached opinion letter. R&T issued more than a billion shares to Pagnano directly in spite of the firm’s own written policy against honoring requests by company officers to issue unrestricted shares to themselves. R&T even made special accommodations so the firm could keep track of Heathrow’s unusually large and frequent issuance requests, which totaled 5.6 billion shares in 27 months.

Without admitting or denying the findings, R&T agreed to settle the charges and pay disgorgement of $24,265.86 plus prejudgment interest of $3,401.78 and a penalty of $100,000, and Montrone agreed to pay a $25,000 penalty.

[PRmaniac]

Pagnano may face prison time in the insider trading case. Plus, the investigation may reveal the scams he was pulling even before he was caught by the SEC in the latest case against him.

[homey_g]

Go ahead...this goose is cooked IMHO, pun intended!

[goose44]

pagnano's facebook page is back up. why don't we send him a message

[homey_g]

How could that possibly be true...

[SevenTenEleven]

HRNF - If that is the case. That is good news!

[goose44]

HRNF to be reinstated

[homey_g]

Agreed!

[moe_the_gyp01]

OMG, 7 billion shares os. Wait, let me guess. All short?

Yeah, got it.

Bwahahaha

[SevenTenEleven]

HRNF - Well lookie there...The glitch was fixed!

Tic Toc

[wiredawg]

Too bad, it's not reflected as a-buck ($1) a share on my portfolio. LOL

[SevenTenEleven]

HRNF - 1 share for a buck last week!

Fees I guess...

[Militia Man]

Three shares for a buck? lol Glitchy glitchy

[SevenTenEleven]

HRNF - Looks like another glitch...

Tic Toc

[Militia Man]

$1 a share?

[ChannelTrader]

Still holding shares here...you never know when these pieces come to life.

[SevenTenEleven]

HRNF - I Sit on a nice little position. Have no intent on taking any losses or write-offs.

Like many targeted OTC Pinks, there is more to the utter collapse than Mike selling shares.

Patience will be key.

Never play with money you can't afford to lose, or have stolen from you by a group of collaborating FINRA market participants/members.

Good Luck!

[wiredawg]

Yeah, me too..LOL

[wiredawg]

Rectified, how? I have 2.5 million brought way back in 2009...just sits there reminding me of my sucker call...LOL

Healthy gum...what the hell was I thinking!!!

[buffalo2222]

well I still would love to see him rot in jail.

[SevenTenEleven]

HRNF - Holding tightly onto my investment here! No reason to walk away.

Remember, billions of illegal equity entitlements issued by the retail brokers.

Those have to be rectified.

Much bigger picture than what is known.

Good Luck!

[wiredawg]

Nah, he'll get probation or some crap and move-on to his next scheme. Think about it ($150K) is not all that much in the whole scheme of things.

[buffalo2222]

Well we are in the news at least. LOL
Hopefully Pagnano goes to prison.
http://www.sec.gov/News/PressRelease/Detail/PressRelease/1370543021551#.VNG3OZ3F-rQ
PRESS RELEASE
SEC Charges Purported Health Food Company and CEO with Issuing False Press Releases in Microcap Fraud
Transfer Agent Also Charged for Missing Red Flags in Unlawful Distribution of Shares Used in Scheme
FOR IMMEDIATE RELEASE
2014-212
Washington D.C., Sept. 23, 2014 — The Securities and Exchange Commission today charged a Florida-based penny stock company and its CEO with defrauding investors by issuing false and misleading press releases proclaiming large sales and fantastic revenue projections while the purported health food company actually was a failing enterprise.
The SEC alleges that Heathrow Natural Food & Beverage Inc. touted sales of natural health food products that the company had not even manufactured as well as non-existent distribution agreements with major retail chains. Meanwhile, its CEO Michael S. Pagnano was prompting the illegal, unregistered distribution of billions of shares of company stock to several people or entities, including himself. Pagnano profited by more than $150,000 by selling 877 million of his shares into the market as the false press releases were stimulating public demand for Heathrow stock. Pagano also is charged with insider trading because he sold his shares while in possession of material nonpublic information about the falsehood of the press releases.

“Heathrow misled investors by peppering the market with remarkable press releases portraying the sky as the limit for worldwide distribution of huge volumes of its products while about the only thing the company was manufacturing was its sales projections out of thin air,” said Andrew M. Calamari, Director of the SEC’s New York Regional Office. “CEOs of microcap issuers will be held accountable when they spread misinformation in the marketplace.”

[janice shell]

It's no longer an SEC registrant, so there's no registration to revoke.

[PRmaniac]

May get revoked? Apparently they do not have a transfer agent, either. Florida did revoke Heathrow, not sure about Delaware.

The SEC may revoke the registration of stocks. In some circumstances, the SEC may revoke the registration of a defunct company's stock. Section 12(j) of the Exchange Act authorizes the SEC to revoke the registration of a security if the issuer fails to comply with the federal securities laws. Broker-dealers may not execute any trades in stocks whose registration has been revoked pursuant to Section 12(j).

A defunct company may not have a transfer agent. In some situations, the defunct company does not have a transfer agent. Although the federal securities laws do not require a company to have a transfer agent, if a company does not have a transfer agent, investors are unable to receive or transfer their stock certificates. Sometimes the SEC has considered a company's lack of a transfer agent as a factor in determining whether to revoke the registration of stock pursuant to Section 12(j) for the protection of investors.

[SevenTenEleven]

HRNF - Holding certs and electronic markers. No interest in taking tax losses. No doubt doing so will be suggested.

Tic Toc

[seanman]

And don't forget the stemcell thing,and the shareholders,who if turned in their shares would be immune from the last,R/S...

I do remember $.20 being a price per share on one of the,"P.R.'s"..

[PRmaniac]

Heathrow - Revoked

Detail by Entity Name

Foreign Profit Corporation HEATHROW NATURAL FOOD & BEVERAGE, INC.

Filing Information
Document NumberF08000004202FEI/EIN Number593617006Date Filed09/25/2008StateDEStatusINACTIVELast EventREVOKED FOR ANNUAL REPORT Event Date Filed09/23/2011 Event Effective DateNONE

Principal Address
7025 CR 46A
STE 1071
LAKE MARY, FL 32746


Changed: 04/19/2010
Mailing Address
7025 CR 46A
STE 1071
LAKE MARY, FL 32746


Changed: 04/19/2010

Registered Agent Name & AddressPAGNANO, MIKE
7025 CR 46A
STE
LAKE MARY, FL 32746


Address Changed: 04/19/2010
Officer/Director DetailName & Address

Title CEO

PAGNANO, MIKE
7025 CR 46A - STE 1071
LAKE MARY, FL 32746

[SevenTenEleven]

HRNF - Not to worry, soon it will be revealed that the brokers were the ones selling illegal shares.

Just ask Etrade et al!

Tic Toc

[fusion3620]

So if wrong doing is proven to be true here, what's the chances of shareholders getting a piece of what they deserve from this thief pagano? Is that realistic or is should we just kiss our $ goodbye?

[PRmaniac]

I remember CEO Pagnano's scamming reports back in the world golf league days before IHUB developed into what it is today. I think it was on rbull, where a student was explaining how his dad and Mikey P. were friends. CEO Mike apparently approached his dad with a deal that would involve Mike telling his dad when to buy and sell shares to be guaranteed to make money. I'm pretty sure this could have been to help mike manipulate the stock price while issuing the fluff PR lies and would allow mike to use this and his own info to dump shares of his own company. The student explained that his dad never went through with the Pagnano scheme. I wonder if they will investigate what he was doing to shareholders back then. Heck, the winner of the Million $ Shootout TV Reality show didn't get the money. That should have already been in escrow before the event was filmed.
The Heathrow Natural scheme was just one of the latest, after the golf-related dilute rinse repeat biz no longer was viable.
Michael Pagnano's victims should be given a chance to appear to make a statement after his sentencing (he is still innocent until proven civilly liable and/or criminally guilty).

And then there is the more-recent real estate/financing business that might draw scrutiny, since Mike was very involved. Same dilution issues.

[janice shell]

Is it really a corrupt TA or only a few individuals that work there?

Hard to say without knowing more. In the complaint, the SEC says that some employees did improper things because they hadn't been trained not to do those things. That doesn't rule out the possibility that Pagnano conspired with one or more R&T employees.

If so, though, the CEO took the brunt of the blame. And it was specified in the complaint that he was responsible for some of what went wrong.

[janice shell]

Guess not. Did you read that entire post?

Companies that are not SEC filers can ONLY issue unregistered stock. But if they choose to do so, in order for it to become free trading, it must be eligible for an appropriate exemption from registration.

[Arthur]

If I remember correctly, HRNF sole and most cherished asset was the footage if an unaired, golf-based reality TV show. $685K worth of it.

That's what it "sold" to Mesa Verde before the company vanished.

[PRmaniac]

Did Heathrow ever really exist before it was created to provide cover to complete his distribution of over 5 billion shares to himself and others?

Pagnano and a business partner owned/controlled the private Heathrow and agreed to be acquired by Pagnano's publicly-traded company.

The SEC should look even further back to the World Golf League and the memberships for shares deals where his partner got tons of shares for memberships supposedly sold. I'm not sure any of the memberships were actually "sold" to real persons. When the shares were then sold into the market, I wonder who split the proceeds and was some of this money used to represent "sales"?

[6pack2go]

Let off lightly? Hmmmmm

The TA agreed to pay nearly $130k for their part in HRNF's CEO profiting $150k.... Not excessive but then again not a small penny for what was fraudulently taken... (at least from the report that I read)

[6pack2go]

Is it really a corrupt TA or only a few individuals that work there?

I mean look at the history and clientele list of this TA, they are no 'fly by night' operation.

[6pack2go]

Of course they were selling unregistered shares. There's nothing wrong with that.

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=59434086


I guess that's another that Janice got wrong....

[janice shell]

lol, that's another problem.

[Arthur]

I'm not even certain that Aurum Guaranty ever existed.

[janice shell]

Did Aurum ever acknowledge that it'd made an offer?

[Arthur]

Heathrow Natural Food & Beverage, Inc. Board of Directors rejects merger with Aurum Guaranty

http://www.prlog.org/11685044-heathrow-natural-food-beverage-inc-board-of-directors-rejects-merger-with-aurum-guaranty.html

PRLog - Oct. 5, 2011 - LAKE MARY, Fla. -- LAKE MARY, FL., October 5, 2011 -- Heathrow Natural Food & Beverage, Inc. (OTCPK: HRNF) has announced that its board of directors after a complete due diligence review, has voted to reject the merger with Aurum Guaranty and pursue a merger with another public company which will be announced shortly.

“After a rigorous review of the dynamics of the proposed merger with Aurum Guaranty, we believe it is in the best interest of our shareholders not to proceed with the merger and move forward with a proposed merger with a well positioned public entity,” said Michael Pagnano, CEO of Heathrow Natural Food & Beverage, Inc.

--------

So there.

[janice shell]

As you say, Pagnano wasn't, and isn't, obliged to file anything with anyone. Of course, since he doesn't, no sane person ought to buy the stock.

And yes, all of the company's stock is unregistered. BUT new stock cannot be registered unless it IS registered, or qualifies from a legitimate exemption from registration. The latter is the problem.

And simply having a product doesn't make a company legitimate. Some of the biggest scams have products. It's good cover.

[janice shell]

HRNF CEO later un-announced that acquisition, claiming that Aurum wasn't offering enough for HRNF.

I typical trick. But if there was never any offer, it's still illegal.

[bogee]

My favorite was the 2 million dollar purchase order for ACAI chewing gum for the US OPEN. Pure scam artist and it's about time they did something. I'm guessing he will get a slap on the wrist and not much more. Fairly typical IMHO.

[bogee]

The criminals always are. I still lost my investment though. Where's my compensation? Oh right. I get nothing.

[SevenTenEleven]

HRNF - Form 15 Filer. All shares issued by the company were unregistered. Nothing illegal in itself.

I don't think there was any mystery as far as HNRF was concerned. Pagnano was evidently issuing unregistered stock constantly.

But cases like these are all the more reason for the SEC to make transfer agents publish all opinion letters received and acted on.

With regard to HRNF, there was a viable business plan and product.

I personally made multiple purchases from vendors who stocked it. GNC was one such merchant.

The claims appear to focus on insider trading, and not the issuance of shares.

Here is a question that maybe you could answer...Being a Form 15 Filer, there is no requirement for the company, its officers, or its shareholders to file SEC forms with regard to material events and/or share purchases or sales...What alternative reporting should Pagnano have done to disclose his issuance and sale of company shares?

[Arthur]

HRNF CEO later un-announced that acquisition, claiming that Aurum wasn't offering enough for HRNF.

You can bet he didn't refund shareholders who bought shares on the strenght of that Major Corporate Update. The shares that were sold then were his own shares, that he was issuing to himself.

[janice shell]

Ought to be illegal to announce bogus acquisitions, too.

It is. But I guess the SEC didn't catch that one, at least at the time.

[Arthur]

Heathrow Natural Food & Beverage, Inc. Announces Restructuring, Spin Off and Planned Merger With Aurum Guaranty With Over $50,000,000 in Assets

http://www.prnewswire.com/news-releases/heathrow-natural-food--beverage-inc-announces-restructuring-spin-off-and-planned-merger-with-aurum-guaranty-with-over-50000000-in-assets-130105998.html

LAKE MARY, Fla., Sept. 19, 2011 /PRNewswire/ -- Heathrow Natural Food & Beverage, Inc. (OTCPK: HRNF) is pleased to announce that its board of directors has approved a spin-off of all current food and beverage related operations into Heathrow Enterprises, LLC, a private entity. In conjunction with the spin-off transaction, the company will concurrently acquire the assets and operations of Aurum Guaranty, a financial services firm.

All HRNF shareholders of record at close of business 30 September 2011 will receive a pro rata distribution of 10% of the newly formed Heathrow Enterprises, LLC. All shareholders will retain their ownership in HRNF and also own equity shares in Heathrow Enterprises, LLC. The equity shares will be entitled to an annual dividend based on the profits of the LLC.

Aurum Guaranty has agreed to assume a portion of the Company's debt as part of the spin-off transaction. "Management believes the corporate restructure, debt elimination, spin-off, and dividend plan provides stockholders the strongest path for equity appreciation," said Michael Pagnano, CEO of Heathrow Natural Food & Beverage, Inc.

Also, HRNF will retain its current Common share structure. The issuance of new Common shares is not required as part of the Company's operational restructure and the Company will not affect a reverse split.

The Company will change its name to "Aurum Guaranty" and will soon release its various Web sites, operational disclosures, and update the Company's filings with OTC Markets to "Current Information" status.

-------

Ought to be illegal to announce bogus acquisitions, too.