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In 2022, the Mississippi Public Service Commissioner wrote a letter to the FCC Inspector General asking for a cease and desist against SurgePays.
The filing shows the contract between AATAC and SurgePays did not involve SurgePays FinTech Platform and involved 6 prepaid Surge Phones per store for an initial 1,525 stores. SurgePays ultimately recalled these phones because they did not work.
Link to report.
https://www.birddogresearch.com/
Scammers exposed! WHOOOPSIES!
SurgePays files $100M mixed securities shelf
SEC Charges Former MusclePharm Executives with Accounting and Disclosure Fraud!
Washington D.C., June 27, 2023 —
The Securities and Exchange Commission today filed a settled complaint charging Las Vegas-based nutritional supplement company MusclePharm Corp.’s former Executive Vice President of Sales and Operations, Brian H. Casutto, former Vice President of Sales, Matthew J. Zucco, and former contract Chief Financial Officer, Kevin R. Harris, for engaging in improper revenue recognition practices to achieve revenue growth demanded by its former Chief Executive Officer, Ryan C. Drexler. The SEC also separately charged Drexler with fraud in a litigated complaint for disclosure violations and control failures.
The SEC’s settled complaint alleges that Casutto, with the assistance of Zucco, engaged in a fraudulent scheme to prematurely recognize revenue for orders that remained in MusclePharm’s control. The complaint further alleges that Harris should have known that MusclePharm prematurely recognized certain revenue and that MusclePharm overstated other revenue by misclassifying customer credits as advertising expenses rather than as reductions to revenue. The defendants’ misconduct allegedly inflated the company’s publicly reported quarterly revenues by as much as 25 percent and gross profits by as much as 49 percent.
The SEC’s complaint against Drexler alleges that, while CEO, he misled investors about the catastrophic impact of the company’s default with institutional noteholders and that he falsely certified that he evaluated the company’s internal controls.
“Honest and transparent financial disclosures are the bedrock of our markets, but as alleged in our complaint, MusclePharm’s executives disregarded these fundamental rules by continuously inflating reported revenue,” said Jason J. Burt, Regional Director of the SEC’s Denver Office. “These actions highlight that the SEC will not hesitate to bring enforcement actions against individuals who threaten the integrity of our markets.”
Without admitting or denying the SEC’s allegations, Casutto, Zucco, and Harris have each consented to the entry of judgments, subject to court approval, permanently enjoining them from violating the antifraud provisions and other provisions of the federal securities laws; requiring Casutto and Zucco to pay disgorgement with prejudgment interest of $79,760.01 and $15,033.06, respectively; requiring Casutto and Harris to pay a civil penalty of $207,183 and $50,000, respectively, and reserving the issue of Zucco’s civil penalty for further determination by the court; and barring Casutto from serving as an officer or director of a public company for five years.
The SEC charged Drexler with violating and/or aiding and abetting violations of the antifraud provisions and other provisions of the federal securities laws and seeks injunctive relief, civil penalties, reimbursement to MusclePharm under SOX 304(a), and an officer and director bar.
Both complaints were filed in the U.S. District Court for the Central District of California.
The SEC’s investigation was conducted by Jennifer Turner and Michael D’Angelo and supervised by Mary Brady, Nicholas Heinke, and Jason Burt. The litigation is being led by Zachary Carlyle and Sharan Lieberman and supervised by Mr. Burt, Mr. Heinke, and Gregory Kasper.
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We filed a settled complaint charging former MusclePharm Corp. executives for engaging in improper revenue recognition practices and former CEO Ryan C. Drexler for disclosure violations and control failures.
https://www.sec.gov/news/press-release/2023-120
Magic customers are the best because you never run out of them!
Can a CEO run a business from jail?
Best short ever! Always short a scammer!
$3.89... Coxy loves tapping into his new personal "credit facility" SurgePays says credit facility announced in November improved supply chain...whoopsies!
Im still short from $7.60! easy money shorting scams!
$4.66 Whoopsie's! Scam!
WAS THE CEO ARRESTED AGAIN?
When is the next SEC investigation?
SCAM!
SEC INVESTIGATION !!!!!!!!!!!!!!!!!!!!!
Whens the next Asian Convenience store convention...the last one was hilarious!
Comical!
SCAM
My dog had diarrhea yesterday and it reminded me of SURG.....
COXY..."LET ME FLEX WHILE I SHAKE YOUR HAND SUCKERS! QUICK SOMEONE TAKE A PICTURE OF MY MUSCLES...OMG!
COXY---ALWAYS SCAMMING!
GLAD I SHORTED THIS SCAM @$7.20 BWAAAAAA HAAAAAAAAA!
WOW! Surge Holdings Inc. Signs Multi-Million Dollar
Whoops sorry it was just old bullshit from 4 years ago that never happened...I thought it was some new bullshit...
Surge Holdings Inc. Signs Multi-Million Dollar MOU with Pastime Foods
The MOU calls for adding 40,000 retail locations with a $1,500 a month per location commitment.
https://www.globenewswire.com/en/news-release/2018/10/09/1618395/0/en/Surge-Holdings-Inc-Signs-Multi-Million-Dollar-MOU-with-Pastime-Foods.html
MAXIM..OFFERING ON THE WAY!
LMAO! Just like SURGPAYS...100% Bullshit! Acquiring a no name cronie owned bs cloud platform to once again skim off cash... of course no name or price mentioned... and of course zero advertising cap ex and no phone numbers ever needed for magical new customers of 300 day.... look out Tmobile and ATT....Coxy has found a secret way to steer 300 magic customers to Scurge every day!
I almost forgot about this POS...then I was taking a dump and the smell reminded me!
Dilution machine! o/s already over 12,063,834 from 2M LMFAO!
It's a miracle! Magically they find a new customer every 2 minutes 24/7 day after day after day with no ads and no stores.... yet shareholders can't find a single location and none are listed on the website.... LLOLOLZZZZZ
WHERE ARE THE BULLSHIT EARNINGS FROM THE MYSTERY STORES AND MYSTERY ADVERTISING ??????
Looks Like Q1 is late again! SCAM!
YEARS OF LIE'S AND BULLSHIT.. NOW A MASSIVE DILUTIVE SHELF FOR COXY TO USE FOR HIS PERSONAL ATM AGAIN!
New Analyst Coverage.. Strong sell price target $1.25.
Bullshit insiders buys in order to dump more shares!
Geo investing... good firm. They rarely change their mind on a company unless they uncover something very sketchy...in this case that happened very quickly! Whoopsie!
SELL RATING NEW PRICE TARGET $1.75!
**Call To Action
We are removing SURG From Our Speculative/Special Situation Model Portfolio
On April 8, 2022 we added Surgepays, Inc. (NASDAQ:SURG) $3.54; $42.6 M market cap) to our Speculative Long Model Portfolio on the heels of its recent acquisition announcement of Torch Wireless, a provider of wireless broadband with the FCC’s Affordable Connectivity Program (ACP). The acquisition enables SURG to be a provider in all 50 states, up from 14 prior.
However, we are removing SURG from the model portfolio as we think it’s prudent to take a deeper dive into the Company, the Torch acquisition and reasons behind the company’s recent shelf filing which caught us off guard.
It’s not that we have a complete aversion to companies raising money or filing a shelf to potentially raise in the future. But due to SURG’s prior dilutive capital raising history, many investors had approached an investment in the company with some trepidation (including us).
We slightly backed off this position after we believed it was clearly communicated by management that they understood that they could have dealt with their capital raising activities more efficiently in the past and that raising capital right now appears to be off the table, especially given the stock’s current valuation and the incredible momentum in the company’s subsidized broadband business.
In our opinion, a more prudent and shareholder friendly scenario would’ve been one where the company allows its subsidized business to start generating consistent positive earnings for the first time in the company's history and allow the stock price rise to a much more appropriate valuation, and then file a shelf.
In fact, recall that analyst estimates are implying that sales and earnings are going to be substantial.
Fiscal 2022 sales expected to be $129.6 million with $1.19 EPS
Fiscal 2023 sales expected to be $179.7 million with $2.91 EPS
The 2022 estimates imply the stock is currently selling at a price to earnings ratio of 2.9x!!!
Quite frankly, to be honest, these estimates would indicate to us that there is no reason to raise money at all and that the company can probably fund its growth organically for the foreseeable future.
One thing that we need to keep in mind is that the company’s legacy business is still losing money. So, does the company want to raise money for that piece of the business?
Again, as communicated in a prior email about this subject, we are not saying or implying that SURG is going to raise dilutive capital. We just don’t understand the move to file a shelf given the current circumstances and we think other investors are probably also confused about this action.
So, we just decided to wait it out a little bit to see how the story begins to play out and if the company addresses the reasons why it filed the shelf. We could be totally overreacting here. But given the history, we thought it would be the right move. This will also give us time to complete additional due diligence into the company.