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and get someone to run the company .... put Haig in the lab.
The prob is that the only "they" here who can do anything are Haig & his brother Arthur, the only directors. The big names they tout are at best only advisors and small shareholders, to the extent they actually have anything to do with the company. (One of them - Gerstner - died recently.)
They claim Michael Binnion and some other guy joined the VG Energy board last year, but I have my doubts.
(And remember Haig isn't a scientist - he's a CPA and tax lawyer. His brother Arthur is a bankrupt insurance salesman, going thru Ch.7 in California last year. I don't see him adding *huge* amounts of shareholder value.)
As they stated in the last annual, they'll have to do a reverse or increase the A/S at some point. As of June they had 1.2B common issued out of 1.5B authorised, and not enough shares left to cover exercise/conversion of all of their outstanding derivatives.
Presumably they have once again ratcheted down the DMBM Inc conversion price from $0.0025, and also presumably much of the volume over the last couple of months has been DMBM dumping.
Then they have a $450K tranche of the T&T settlement coming up in November. At current pricing that would require another 200M+ shares of common to be issued.
Overall, their situation with DMBM is just another form of death spiral. Has the company even tried to get legitimate financing which might preserve at least some value for common share holders? The way things are, there seems no reason for there to be a bottom to the price & so IMO avergaing down makes zero sense.
SEC filed its first amended complaint.
On a quick read I think the major additions are intended to establish US jurisdiction for the action, versus defendants' arguments that recent decisions in other cases mean that US courts have no jurisdiction for fraud claims against the offshore entities.
Perhaps a bit sharper focus on some of the motivation - ie, avoid having to write down any of the positions, to preserve management and performance fees - and some email stuff from discovery in support of this.
(Wish they were required to file a red-line version so you could pick out the changes/additions more easily.)
And the curtain falls ...
http://www.sec.gov/litigation/admin/2012/34-67530.pdf
Accordingly, it is hereby ORDERED, pursuant to Section 12(j) of the Exchange Act, that registration of each class of Respondent’s securities registered pursuant to Section 12 of the Exchange Act be, and hereby is, revoked.
Not really sure what you're saying. These cases always drag on forever; nothing unusual going on here, IMO.
I wonder if the DMBM conversion price has been ratcheted down again, from the $0.0025 set last November. Previous resets were to $0.005 and $0.01 (as far as I recall, down from $0.02).
Haig agreed to these resets without letting the market know at the time, much less giving any explanation as to why they were in the best interests of shareholders in general. No apparent reason why he might not have done so again, with the falling share price.
At best, really bad governance.
SEC will be filing an amended complaint in Aug; case won't get past the motion to dismiss stage before Nov. These cases drag on & on ...
From the docket:
07/19/2012 58 First MOTION for Extension of Time to Amend the Complaint by Securities and Exchange Commission. (Byrne, Kenneth) (Entered: 07/19/2012)
07/20/2012 ORDER granting 58 Motion for Extension of Time to Amend. The Court has received plaintiff's counsel's letter dated July 19, 2012, requesting an extension of time to file its Amended Complaint and an extension of the current briefing schedule concerning the related motion to dismiss. Defense counsel consents to this request. IT IS HEREBY ORDERED that the request is granted. Plaintiff shall file the amended complaint on August 17, 2012. Defendants' motion to dismiss the amended complaint shall be filed on September 21, 2012. Plaintiff's opposition shall be filed October 19, 2012. Defendant's reply shall be filed November 5, 2012. SO ORDERED. Ordered by Judge Joseph F. Bianco on 7/20/2012. (O'Neil, Jacquelyn) (Entered: 07/20/2012)
Court has approved plan trustee's motion for settlement with SEC, so presumably a revocation order will be coming along soon.
Bye bye, Locateplus stock.
On the criminal front, court will hold a hearing in Aug on JF's attorney's motion to compel the govt to enter into a formal plea deal allowing JF to argue for minimal slammer time. FWIW, I'd be amazed if that works.
Dog bites man! I just think it's a bit pathetic if the suggestion is that this is something new - Wall St has always been like that. The industry's function is to sell stuff; obviously people in the industry are going to be crossing lines all the time to the extent they're able to get away with it. What's needed is a tighter border-watch on those lines through better outside enforcement. Self-regulation is & always has been a joke.
But as always, the rhetoric misses at least half of the point - line-crossing from the buy-side. The big scams don't happen without the willing or wilfully ignorant participation of pension fund, mutual fund, bank asset managers, all looking for "alpha" levels which are fundamentally impossible with accurate measurement of risk levels.
That's the nexus which drives most financial markets corruption - buyers looking for lies about risk, and sellers happy to manufacture lies for them.
If anybody in authority really wanted to do something useful, a wide-ranging investigation into the pension fund management industry would be the number one priority. But think of the big hairy scary worms which might be released by opening that particular can.
Scary ...
Just a little bit of lame mathematical-logic-geek humor :)
http://en.wikipedia.org/wiki/Cantor_diagonalization
A lovely story in the NYT today about fabulist Albrecht Muth and his DC "social Ponzi scheme":
http://www.nytimes.com/2012/07/08/magazine/albrecht-muth-and-viola-drath-georgetowns-worst-marriage.html
The way he managed to con the famous & powerful into giving him legitimacy reflects the way some pennyscam operators manage to get respectable & prominent names to join their boards, their advisory committees etc etc. Once you've managed to con the first coouple, you're into the relationship network and it becomes a lot easier. For many of these pigeons, getting to the top means that you don't have to do borings things like diligence, research & analysis - that's what staffers are for.
To attract eminences to his group, Muth began by ordering thick stationery that he adorned with a crest of his own design. He signed the letters with an impressive title — Count Albi — which Muth claimed a distant relative who had suffered a debilitating fall from an Indian elephant passed down to him. And he operated according to some key principles that Drath described in her memoir. To score a big-name dinner guest or a favor from a V.I.P. in Washington, there was no point messing around with official channels or wasting time with midlevel functionaries. Underlings fear for their careers and are more likely to examine new acquaintances for potential peril. But there’s an unexpected naïveté among the truly powerful; they assume that anyone who has arrived at their desk has survived the scrutiny of handlers.
Michel Rocard received one of Muth’s first invitations. “I had never heard of him,” the former prime minister told me. But Rocard liked the group’s mission, and his political career needed new purpose. With Rocard on the masthead as chairman, Muth had no trouble recruiting other V.I.P.’s. When Peggy Mason, the former Canadian ambassador to the U.N., received her invitation, she quickly accepted: “Of course,” she told me, “I figured if these other eminent people were already in. . . .”
Less than 24 hours to the announcement of the (more-or-less) discovery of the Higgs boson. If it's just as predicted by the standard model, at worst this will represent a stunning illustration of the depth of the understanding of reality physicists have achieved over the last ~100 years. If it's something different, it may be the experimental kick-start for a further radical deepening.
Practical applications will quickly follow, no doubt. Look out for the first promotion of a pennystock claiming IP for a Home Hadron Collider (HHC) producing beams of Higgs particles for use in curing cancer, AIDS & teenage obesity, within a couple of months.
I believe I have a proof that the set of pennyscam stocks is uncountably large:
[A] We know that for any integer N there is a pennyscam stock with authorized shares (normalized to remove reverse splits) equal to N.
[B] Assume that the set of pennyscam stocks is countable & arrange them according to some linear ordering.
[C] Consider the pennyscam stock P such that in the decimal expansion of its A/S, for each integer i, the i-th position is one greater (modulo 10) than value in the i-th position of the decimal expansion of the A/S of the i-th member of the linear ordering.
[D] By [A], we know that such a pennyscam stock P exists.
[E] By the construction of [C], we know that P is not a member of the assumed linear ordering; and further the generality of the method ensures that no linear ordering of pennyscam stocks can be complete.
[F] Therefore, the set of pennyscam stocks has cardinality greater than aleph-null.
Now I believe that it should be an easy exercise to show that the set of pennyscam suckers must also be uncountably large, given only the assumptions:
- Every pennsycam stock has at least one pennyscam sucker shareholder.
- Every pennyscam sucker is a shareholder in at most a finite number of pennyscam stocks.
I acknowledge that some may find the second assumption contentious.
But how many deals did he actually finish, whereby through converting to stock and selling on the open market he was able to recoup all the principal and interest from the loan and close out the investment? Did it ever happen? Even once?
At least one: VRAL, a pennytrash stock I follow. CR and some other penny PIPE names were in it. It was kind of a one-off thing: management organised a conversion with all of the debt holders, deregistered the stock and then to all appearances ran a pump'n'dump to get them all out nicely, presumably with some ummmm benefit to themselves (ie management).
The p&d is the big spike in mid-2009 in the VRAL price/volume chart.
CR would have made a killing on it. Can't see any good reason why VRAL would have facilitated this unless they were getting kicked back somehow-or-other. CR and his ilk never force a bankruptcy on a company which doesn't pay back, as far as I can see. If they did, they'd have to write down the position and therefore take a hit on their management fees.
Be interesting to see whether PwC thinks it's worth going after any of these pieces of trash for repayment.
That S-1 was actually declared effective on 8 June 2011, wasn't it? http://www.sec.gov/Archives/edgar/data/790652/999999999511001773/xslEFFECTX01/primary_doc.xml
Then they filed another S-1 on 12 July 2011, which is the one they are withdrawing, I think: http://www.sec.gov/Archives/edgar/data/790652/000079065211000028/0000790652-11-000028-index.htm
Both of these were to register shares for sale by Steve Hicks/Southridge.
Hicks of course is a sleazy PIPE player being sued by the SEC in a case that seems to be taking forever: http://investorshub.advfn.com/boards/read_msg.aspx?message_id=55916992
I guess the Hicks involvement is probably one reason why the Corporation Finance division at the SEC were questioning the first S-1 filing so minutely.
Good to see! Usually they seem to just run through a bureaucratic checklist.
But once again - after all the work, they eventually declared the S-1 effective and no apparent enforcement action came of it, unless I've missed something.
Apparently NIR didn't keep any electronic documents concerning its diligence on PIPE deals or conversion requests - just paper files in "approximately 200 boxes" relating to the ~100 portfolio companies, now stored in a warehouse.
(The SEC wants them to produce an index to the files; NIR says go rummage for yourself.)
For some reason that gives me a chuckle.
It'd be interesting to see what kind of diligence they actually did ...
They did a 4:1 forward split, ex-date 6/25.
http://www.sec.gov/Archives/edgar/data/1282571/000106299312002172/form8k.htm
No agreement reached between CR and the SEC, so the case is back on; next hearing is July 12.
The parties have resumed their squabbling over discovery, protective orders, privilege etc etc.
Slow, but still << popcorn >>
Docket:
06/11/2012 ELECTRONIC ORDER granting 48 Motion to Adjourn Conference. The conference is adjourned to 7/12/12 at 2:30 PM. Ordered by Magistrate Judge Gary R. Brown on 6/11/2012. (Brienza, Lauren) (Entered: 06/11/2012)
06/26/2012 50 STATUS REPORT by Corey Ribotsky, The NIR Group, LLC (Rossan, Jennifer) (Entered: 06/26/2012)
06/27/2012 51 MOTION for Discovery by Securities and Exchange Commission. (Attachments: # 1 Proposed Order) (Fischer, Howard) (Entered: 06/27/2012)
06/27/2012 52 RESPONSE in Opposition re 51 MOTION for Discovery filed by Corey Ribotsky, The NIR Group, LLC. (Rossan, Jennifer) (Entered: 06/27/2012)
06/27/2012 53 MOTION to Compel by Securities and Exchange Commission. (Attachments: # 1 Exhibit Exhibits 1-5) (Byrne, Kenneth) (Entered: 06/27/2012)
Plan trustee asking the bankruptcy court to approve a settlement with the SEC which would see the registration of all LP securities revoked. As expected.
Matt Brown: A consent judgement agreed this week in the SEC case, with the usual permanent injunctions against violations of regs, pennystock bar and $110K disgorgement absorbed into his $4M+ forfeiture judgement in the criminal case.
Idle question: Under the JOBS Act, do these kinds of sanctions prevent a fellow from lending a hand with crowdfunding efforts? I can see how Matt might be really useful there, if not impeded by fussy old-school regs and a history of ripping people off in securities frauds.
I inherited my dead uncle's stamp collection - seven big albums filled with all sorts of stuff. I had it valued at a couple of places: one guy offered $20, the other $35.
I don't think my uncle was a very good collector.
I ended up giving the collection to my niece for Christmas, as she had been a very naughty girl that year (plus a gameboy voucher).
The Commission’s civil injunctive action is stayed until the conclusion of the criminal case, which remains pending against both Fields and LocatePlus
An odd mistake - there's no criminal charge against Locateplus.
he would have to hold for a year anyway after converting
I think that's the point of having a convertible note arrangement for the salary - ie that the one year clock starts ticking from the date of the issue of the note (which was Jan 11), not from the date of conversion.
But I'm not sure that cunning plan, if it is in fact Haig's cunning plan, actually works very well from a securities regs point of view - anyway, there has been a flurry of SEC actions recently where similar-looking schemes have been pinged as Bad Things.
Wow. They're going to pay a university commercialization arm to do a study. How exciting.
And today Crane resigned: http://biz.yahoo.com/e/120615/gltv8-k.html
That was quick!
Crane popped up as a new director and SVP at some pennytrash called GLTV back in April. An 8K from GLTV today announced his resignation: http://biz.yahoo.com/e/120615/gltv8-k.html
Perhaps on reflection they realised that it actually might not be a really excellent idea to take on board a self-confessed securities criminal.
Unlike VRAL, which appears comfortable with him in the PR/IR role, in preference to the approx 6.2 badzillion hungry little PR/IR operators in the US *without* criminal records.
Finally posted Q1 financials & info statement at OTC Markets. On a quick read, nothing much that wasn't included in the annual.
As we know, continuing to get funded by DMBM via debentures convertible into common at $0.0025. In the three months to March 31st, "DMBM elected to convert a total of $131,000 of
debenture principal and received 52,400,000 common shares of the Company. In connection with these conversions, the
excess of the fair value of these shares issued over the principal amount of debentures satisfied was $661,840 in the three
months ended March 31, 2012, and such amount is included as a non-cash financing charge in interest expense."
Assuming that DMBM immediately sold these shares into the market, they made a $662K profit, for a total return of ~6X their cost, at the expense of other shareholders. Not bad!
Looking at the cash-flow, the company burned $312K in the quarter. They funded themselves by selling stock and warrants to people for $67K and by selling a further $374K of the debentures to DMBM.
They used $118K of this funding to pay down the line of credit to Best Investments - ie Haig and wossisname, his Malaysian buddy.
In other words, the company at Haig's direction is selling off shareholders' equity to DMBM at a 75%+ discount, and using a large proportion of the proceeds to pay himself back, with interest. Nice!
Haig also converted $75K of his accrued salary into 6.6M shares. Recall that he & the other insider staffers/consultants are being paid under a note which lets them convert outstanding balances into shares at 80% of the 20-day trailing VWAP.
Nice - no risk! And if the shares are free-trading, they can take advantage of any price spike to convert at a discount to the pre-spike pricing and dump for a tidy profit, at shareholders' expense.
Sentenced to 5 years today - ie the term agreed to in the plea deal & I think somehow-or-other the statutory max for the count.
Latorella gets five years. From the docket:
06/14/2012 ELECTRONIC Clerk's Notes for proceedings held before Judge Douglas P. Woodlock:Sentencing held on 6/14/2012 for Jon Latorella (1), Government's recommendation heard; Victim Impact Statement given; defendant's recommendation heard; defendants right of allocution exercised; on Count 1, defendant sentenced to 60 months incarceration followed by 3 years supervised release with standard and special conditions. $100 special assessment. No Fine. Defendant shall self-surrender at the institution designated by the Bureau of Prisons on 9/30/12. Defendant advised of right to appeal. (Attorneys present: AUSA's Lelling and Levenson for the Gov't; Goldstein and Weinberg for the deft) (USPO: L. Paiva)Court Reporter Name and Contact: Brenda Hancock (617-439-3214). (Lovett, Jarrett) (Entered: 06/14/2012)
Well, that's depressing enough.
FWIW, the PR gives Haig as the contact, rather than Crane/BlueWater as in previous PR's. But the letter itself still has Crane as a contact.
Old Geoffers is slipping down the gurgler. Lord knows why anybody would pay him to pump at this stage, but he sure needs the $$$$ if only to pay for a lawyer.
The SEC is close to getting a default judgement against his NFC because he tried to represent it himself, rather than having a lawyer do it - not allowed, Geoffers!
The judgement the SEC is seeking looks like it might take him out of the pennyscam market completely:
Defendant and Defendant’s agents, servants, employees, attorneys, and all persons in active concert or participation with them who receive actual notice of this Final Judgment by personal service or otherwise are permanently restrained and enjoined from directly or indirectly: 15 U.S.C. § 78u(d)(5). Specifically, the Commission seeks the following injunction:
(a) promoting, advertising, or marketing any issuer of any penny stock as defined by Rule 3a51-1 under the Exchange Act [17 C.F.R. 240.3a51-1];
(b) deriving compensation from the promotion, advertising, or marketing of any issuer of any penny stock;
(c) causing the promotion, advertising, or marketing of any issuer of any penny stock; or
(d) engaging in activities with a broker, dealer or issuer for purposes of issuing, trading, or inducing or attempting to induce the purchase or sale of any penny stock.
Here's the docket:
United States District Court
District of Massachusetts (Boston)
CIVIL DOCKET FOR CASE #: 1:11-cv-12185-GAO
Securities & Exchange Commission v. Eiten et al
Assigned to: Judge George A. OToole, Jr
Cause: 15:78m(a) Securities Exchange Act
Date Filed: 12/12/2011
Jury Demand: Both
Nature of Suit: 850 Securities/Commodities
Jurisdiction: U.S. Government Plaintiff
Plaintiff
Securities & Exchange Commission represented by Deena R. Bernstein
U.S. Securities & Exchange Commission
33 Arch Street
23rd Floor
Boston, MA 02110-1424
617-573-8813
Fax: 617-573-4590
Email: bernsteinD@sec.gov
LEAD ATTORNEY
ATTORNEY TO BE NOTICED
V.
Defendant
National Financial Communications Corp.
Defendant
Geoffrey J. Eiten
Date Filed # Docket Text
12/12/2011 1 COMPLAINT against National Financial Communications Corp., Geoffrey Eiten (Fee Status: US Government), filed by Securities & Exchange Commission. (Attachments: # 1 Civil Cover Sheet with Category Sheet)(Bernstein, Deena) (Entered: 12/12/2011)
12/12/2011 ELECTRONIC NOTICE of Case Assignment. Judge George A. OToole, Jr assigned to case. If the trial Judge issues an Order of Reference of any matter in this case to a Magistrate Judge, the matter will be transmitted to Chief Magistrate Judge Judith G. Dein. (Abaid, Kimberly) (Entered: 12/12/2011)
12/12/2011 2 Summons Issued as to All Defendants. Counsel receiving this notice electronically should download this summons, complete one for each defendant and serve it in accordance with Fed.R.Civ.P. 4 and LR 4.1. Summons will be mailed to plaintiff(s) not receiving notice electronically for completion of service. (MacDonald, Gail) (Entered: 12/12/2011)
01/11/2012 3 WAIVER OF SERVICE Returned Executed by Securities & Exchange Commission. Geoffrey J. Eiten waiver sent on 12/16/2011, answer due 2/14/2012. (Bernstein, Deena) (Entered: 01/11/2012)
01/11/2012 4 WAIVER OF SERVICE Returned Executed by Securities & Exchange Commission. National Financial Communications Corp. waiver sent on 12/16/2011, answer due 2/14/2012. (Bernstein, Deena) (Entered: 01/11/2012)
02/14/2012 5 MOTION for Extension of Time to 2/28/2012 to File Answer by Geoffrey J. Eiten, National Financial Communications Corp..(Bernstein, Deena) (Entered: 02/14/2012)
02/23/2012 Judge George A. OToole, Jr: ELECTRONIC ORDER entered granting 5 Motion for Extension of Time to Answer re 1 Complaint Geoffrey J. Eiten answer due 2/28/2012; National Financial Communications Corp. answer due 2/28/2012. (Lyness, Paul) (Entered: 02/23/2012)
02/28/2012 6 ANSWER to 1 Complaint with Jury Demand by Geoffrey J. Eiten, National Financial Communications Corp..(Danieli, Chris) The answer is to be stricken from the record. (Entered: 02/28/2012)
03/06/2012 7 MOTION to Strike 6 Answer to Complaint as to National Financial Communications, Corporation by Securities & Exchange Commission. (Attachments: # 1 Exhibit Local Rule 7.1 Certficate)(Bernstein, Deena) (Entered: 03/06/2012)
04/13/2012 8 Judge George A. OToole, Jr: ORDER entered granting 7 Motion to Strike (Lyness, Paul) (Entered: 04/13/2012)
04/13/2012 9 MOTION for Entry of Default as to National Financial Communications Corporation by Securities & Exchange Commission.(Bernstein, Deena) (Entered: 04/13/2012)
04/24/2012 10 NOTICE: Clerk's ENTRY OF DEFAULT as to National Financial Communications Corp. (Lyness, Paul) (Entered: 04/24/2012)
04/24/2012 11 Judge George A. OToole, Jr: ORDER entered. STANDING ORDER on motions for default judgment re 10 Notice: Clerk's Entry of Default (Lyness, Paul) (Entered: 04/24/2012)
04/24/2012 12 NOTICE by Securities & Exchange Commission as to Unavailabilty (Bernstein, Deena) (Entered: 04/24/2012)
05/22/2012 13 MOTION for Default Judgment as to National Financial Communications, Corp. by Securities & Exchange Commission. (Attachments: # 1 Text of Proposed Order)(Bernstein, Deena) (Entered: 05/22/2012)
05/22/2012 14 MEMORANDUM in Support re 13 MOTION for Default Judgment as to National Financial Communications, Corp. filed by Securities & Exchange Commission. (Attachments: # 1 Affidavit Sofia Hussain Declaration)(Bernstein, Deena) (Entered: 05/22/2012)
06/05/2012 15 Opposition re 13 MOTION for Default Judgment as to National Financial Communications, Corp. filed by Geoffrey J. Eiten. (Lyness, Paul) (Entered: 06/06/2012)
06/06/2012 16 MOTION to Strike 15 Opposition to Motion by Securities & Exchange Commission.(Bernstein, Deena) (Entered: 06/06/2012)
Two stories from back in the day in this old SI post: http://www.siliconinvestor.com/readmsg.aspx?msgid=22406400
The first details the indictment of Bryan G. Crane in 2006, owner of VRAL's PR firm BlueWater Advisory, resulting from an FBI kickback sting. This involved the company he was working for at the time as a senior exec, a pennyscam called Roaming Messenger. Crane subsequently pled to one count, sang nicely to the feds against somebody else, and got off with 6 months home detention and a fine.
The second piece is a PR from 2005 announcing a bogus deal between Roaming Messenger and Xybernaut. Of course, Martin Weisberg's 2007 indictment and recent guilt plea were to do with his involvement as Xybernaut director and outside counsel in one of its scams.
So this would seem to put Crane and Weisberg pretty near to each other back in those days.
The chair of Xybernaut was also the chair of Hugh Austin's 2dobiz, Phillip Pearce. See eg http://www.sec.gov/Archives/edgar/data/1098578/000091068000000473/0000910680-00-000473-0001.txt Wesiberg was attorney for 2dobiz: see eg http://www.wnd.com/markets/action/getedgarwindow?accesscode=91068002000084
Recall that 2dobiz a/k/a Interlock a/k/a NY International Commerce Group has a history with VRAL going back to at least 2002, when they formed a JV for VRAL's disastrous attempt to run a trial in China. It is also a vehicle mentioned frequently as being used to launder Capwill scam money.
Finally, VRAL's outside accountant, Myron W. Landin, was 2dobiz/etc CFO back in the same period. See http://www.sec.gov/Archives/edgar/data/1096297/000091068002000800/f857066.txt
From the prosecution's sentencing memo:
The investor list essentially memorializes Latorella’s wholesale betrayal of the women unlucky enough to get involved with him: he misappropriated the names, dates of birth and social security numbers of no less than six women .. half of whom had been junior employees at Locateplus [and BTW, most of whom ended up bearing his children - 8 of them at last count ...]
As to one of them .. he went further, pressuring the mother of two of his children to commit fraud by opening a brokerage account based on fake information, and then telling her to sell Paradigm stock from the account as he directed. ..
Nor was Latorella’s contempt reserved for colleagues, intimates and the dead. For example, .. Christopher Romeo, Latorella’s longtime personal attorney and a Locateplus board member .. urged Latorella to tell the board that the IRS was looking into Latorella’s dealings. Latorella replied, roughly, “I am so fucking far ahead of these idiots, they got nothing on me.”
My guess is that the judge will be straining at the traces to whack Latorella pretty hard. The guy really is a nasty piece of work.
From the prosecution's sentencing memo:
The investor list essentially memorializes Latorella’s wholesale betrayal of the women unlucky enough to get involved with him: he misappropriated the names, dates of birth and social security numbers of no less than six women .. half of whom had been junior employees at Locateplus [and BTW, most of whom ended up bearing his children - 8 of them at last count ...]
As to one of them .. he went further, pressuring the mother of two of his children to commit fraud by opening a brokerage account based on fake information, and then telling her to sell Paradigm stock from the account as he directed. ..
Nor was Latorella’s contempt reserved for colleagues, intimates and the dead. For example, .. Christopher Romeo, Latorella’s longtime personal attorney and a Locateplus board member .. urged Latorella to tell the board that the IRS was looking into Latorella’s dealings. Latorella replied, roughly, “I am so fucking far ahead of these idiots, they got nothing on me.”
Another case where the prosecution calculates a guideline range lower than the probation office: http://investorshub.advfn.com/boards/read_msg.aspx?message_id=76436823
Latorella sentencing memo's filed.
It seems that there's a 5 yr statutory max for the one count JL is to be sentenced on. The probation dept came up with a recommendation for 235 - 293 months, but I think this is just notional, given the 5 yr cap? Anyway, we'll see what the judge does with it next week.
In another of the odd-seeming situations where the prosecution is softer than the probation dept, they calculate the guideline range as 151 - 188 months.
Part of the discrepancy comes from the prosecution not asking for an obstruction of justice upwards revision. This is because the DoJ "inadvertantly" failed to ask for such a revision in O'Riordan's sentencing and feels that it therefore can't ask for it in JL's case. Bizarre. One more fishy element in the O'Riordan deal.
Other points of interest:
- JL's prescription drug of choice is apparently Xanax and he drinks himself into oblivion every day (according to his attorneys).
- DoJ asking for restitution of $6.8M. The bulk of this represented by Austin W. Marxe's Special Situation Fund's loss of $4.9M. They include interview transcripts, emails etc which for me serve mainly to illustrate SSF's utterly inadequate diligence.
Eg: Supposedly despite intense review of LP's SEC filings nobody from SSF picked up on the array of red flags which festooned these from the earliest registration statement onwards. When ex-director Gallagher told them about the Omni fraud etc, they accepted as sufficient comfort an emal from JL and the report of a conversation between JL and the broker from shady Laislaw & Co (UK) who intro'd the deal to them originally. Nothing here about SSF's investment mainly going straight out the door to pay off debt to Laurus which they would surely have known was going to happen. Etc etc etc.
- No hint that anybody connected with LP except JL, JF and O'Riordan) were anything but victims. The shadows of Tom Murphy and Geoffrey Chalmers flit through the records in various places but nothing to bring them into the spotlight.
He comes off as pretty creepy from his brother's letter to the judge.
I guess that wasn't the intention, tho.
Wow!
I guess he'll appeal - wonder if it will stand up?