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Like I told you before no I haven't heard of such thing but I'm sure it's happened before.
The simple fact is SEC has regulations. In order to seek legal/financial remedy you have to tell SEC which regulations Grifco violated. The matter about stocks being sold to cover the CTBG shortage doesn't directly relate to a regulation but Grifco not disclosing CLEARLY the facts and circumstances of the matter that caused such action to take place is what SEC would be interested in. Specifically, they failed to disclose material information. They violated rule 10b-5 of the Exchange Act. If you and others had known there was a problem and a possibility of an adjustment to your CTBG distribution, the shares would have never been sold. Because the public wasn't informed certain people sold out which caused great financial injury. Complaining to SEC about all the peripheral stuff isn't going to help because they're just going to look at it as a civil matter and not a regulatory matter.
I doubt if there is an investigation going on. They could file a dozen charges against JD just based on the CTBG distribution. There are more charges that can be tacked on from the Uselton & GGI case which SEC already bought charges on those entities. Aside from the 75 or so PRs with material omissions and falsification that's beyond safe harbor limits. The PRs were to sell stock not to inform the public which is what it should do.
If you believe SEC investigation is really going on why would it take over a year? I could imagine the cost would run in the hundreds of thousands.
There are numerous other logical reasons why I don't believe SEC is investigating Grifco.
The only way to curb pink sheet fraud is for the States like Nevada and Wyoming to set higher standards for these rouge companies. SEC can also set higher standards for microcap companies making it easier to enforce blatant violations.
SEC would probably argue that these microcaps struggle to survive and they don't have the funds to support a higher compilation standard. Let this be a lesson for those who champion deregulation. Pinksheet/microcap is an epitomizes what would happen when you don't regulate the market.
Don't overlook the forest for a tree. You have to look at what specific regulations Grifco had violated. The foundation of SEC regulations is the Securities Act of 1933, Exchange Act of 1934, and more recently the Sarbanes Oxley Act.
It doesn't matter if they bought the share on the info or not. By law Grifco, as a public company, is responsible to disclose all material information as stated in the Securities Exchange act of 1934 Rule 10b-5
Rule 10b-5 -- Employment of Manipulative and Deceptive Devices
It shall be unlawful for any person, directly or indirectly, by the use of any means or instrumentality of interstate commerce, or of the mails or of any facility of any national securities exchange,
To employ any device, scheme, or artifice to defraud,
To make any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading, or
To engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person,
in connection with the purchase or sale of any security.
It doesn't seem that difficult to prove how JD violated the above regulation. In fact, IMO he's violated the above dozens of times. So why haven't SEC acted yet?
It was supposed to go to court this summer but had been extended. It's still pending.
http://www.cftc.gov/opa/enf05/opa5125-05.htm
Notice the key issue in this suit: ...The complaint alleges that starting in January 2004, American Derivatives, Brokerage Management, Mittler, Gerstel, and Booth engaged in a fraudulent scheme to solicit customers to trade commodity option contracts by making fraudulent misrepresentations and omissions of material facts,
It didn't take them very long to bring up the suit.
Typically common has voting rights and preferred doesn't. Dividend are usually given at management's discretion. Dividends to preferred are typically fixed amount and will be stated on the preferred shares like it would on a bond. There can be different classes of preferred.
According to Tree Top/Grifco's merger filings with the SEC Jim Dial was given "Super Voting" preferred shares that gave him something like 20 votes for every 1 preferred shares. Jim Dial (being the sole board of director) issued himself a few million preferred shares basically given him majority control.
Now, I am not sure the super voting preferred share is legal. At the very least it is very unethical. He used the excuse to that it was to thwart hostile takeover. I don't buy that for one bit. Obviously, takeover would have been the best thing for Grifco as it's a worthless empty shell now.
Basically, Jim Dial just made up stuff to benefit himself as he went along. Who knows what other power, benefit, and financial gain he secretly gave himself.
Technically JD was right when he said management wasn't selling shares. They were making side deals with 3rd parties who subsequently sold shares....millions of shares.
CTBG share price took quite a dive.
If some of the proceeds from the IRA sale was used to cover the non-IRA account and you're under the age of 59 1/2 you may technically owe a 10% penalty for early distribution of your IRA. The portion used to cover the CTBG short shares in the IRA account won't be penalized. You may even be able to claim it on your current tax return as a worthless investment if the value of the IRA is $0.
Excess contribution to the IRA is not illegal. There is just a penalty element to it but it doesn't mean you can't do it. Anyways, this is more of a tax matter not a Security or a legal matter which is what SEC is concerned with.
The sell was caused because of the problem with the pink sheet stock.
In Grifco case the adage "invest only what you can afford to lose" doesn't apply. I would say "don't invest in an unregulated pinksheet...it can lead to financial disaster".
Stocks trading on the higher exchange track exactly how many shares they have outstanding. The fault should like on Grifco, transfer agent or DTCC - who ever is responsible to track the stock. I suppose one of these organization exist primarily to protect the public from such debacle.
This type of stuff is very rare in occurrence.
I wouldn't be surprised if they did. Now if you define compensation as some sort of financial gain - I remember back in July 2006 2 shareholders - BBB & Visxlaser were given insider information by JD well before the information was public. Jim Dial even had them to sign a non-disclosure agreement not to reveal the information to others. That in itself violated the Securities Act of 1933. Had these 2 guys been an employee of the company or an independent 3 rd party this may have been o.k. Instead, these guys were shareholders who received confidential material information could result in a financial gain. That in itself is a SEC violation no public company would be immune to.
Not sure exactly how much he made but I am pretty sure he sold out most of his shares before it all went kaput.
That was when JD register 1st Texas Natural Gas. I guess he figured out shareholders were tracking his Nevada filing so he register 1st Tx in the OTHER scam haven - Wyoming.
Do you really think SEC would give the same weight in prosecuting Grifco than it would an Enron.
SEC explicitly warns people about investing in pink sheet companies. They literally say these companies are not regulated so beware and do a lot of research before investing....therefore people running around yelling they have been scammed is nothing surprising or appalling to the SEC. It's like trying to hold a witch doctor legally responsible for not curing cancer.
One study (COSO report co-authored by one of my former Accounting Professors for) indicated that 75% of fraud committed by public companies are traded on the pink sheets.
http://investorshub.advfn.com/boards/post_reply.asp?message_id=40816640
With the exception of a few foreign issuers, the companies quoted in Pink Quote tend to be closely held, extremely small and/or thinly traded. Most do not meet the minimum listing requirements for trading on a national securities exchange, such as the New York Stock Exchange or the Nasdaq Stock Market. Many of these companies do not file periodic reports or audited financial statements with the SEC, making it very difficult for investors to find reliable, unbiased information about those companies. For all of these reasons, companies quoted in Pink Quote can be among the most risky investments. That's why you should take extra care to thoroughly research any company quoted exclusively in the Pink Quote. Be aware that some broker-dealers are required by Rule 15c2-11 under the 1934 Act to have some information about the issuer. Ask your broker-dealer whether it has any Rule 15c2-11 information before you invest.[i/]
Well let me put it this way. Of the 12-13 people that showed up at the SH meeting, only about 1/3 of them received anything in the mail regarding the meeting. Rest of them went because of the PR, call made to Investor Relation, and/or the information posted on the message board. Feedback on RB and this board at the time was that only a couple of people said they received an invitation. There could have been more than six invitations but the overwhelmingly majority of the people were not notified.
Yes complaints were filed with the SEC. The character of the RB board constantly changed. It didn't influence my sentiment towards Grifco. I knew they were just as much of a scam then as they are now.
Does all that stuff matter now? It's in the past and the questions should have been raised at that moment not 2-3 years after the fact.
Many people thought it was odd for the CEO flanked by 2 body guards not to utter a word at a shareholder's meeting where only 6 people got an invitation. The excuse back at the time was that since the company's books were being audited, the auditors ask that JD not speak at the meeting. I can tell with 100% absolute certainty that an Auditor will not & can not say such things to management. So it was another lie - surprise!!!
What allowed Jim Dial & Jarvis clan to get away with all the crap was the apologist like BBB, a.k.a. the pied piper, who continued to wave the ether at the majority on the boards. Most people were too mesmerized the poetic prose, niceness, and greed. Unintended or not BBB was the perfect unofficial PR man for JD and the clan. Skepticism and accountability....the rationale by most was that... "JD would never tell a fib because if he does...he will go to jail!!!....anyone who ask questions must be short"...
CTBG is trying to protect their interest which may not necessarily be that of the shareholder. It's up to the shareholders to hire an attorney to protect themselves.
I still have some GFCI. At this point it's worthless. It would cost more to sell the shares. I sold my CTBG shares. Ametirade adjusted my account like everyone else but it didn't destroy my account like it did some. Bulk of CTBG shares was in Merrill Lynch which I also sold. They are honoring the court order and haven't adjusted my account. They are waiting until the matter is settled.
Outstanding Shares as of 8/15/06 was 106,326,937. This was the amount Dial reported to Pinksheet.com.
http://www.pinksheets.com/pink/quote/quote.jsp?symbol=gfci#getCompanyInfo
The outstanding at 12/31/06 was around 126,000,000 shares. I would bet the current O/S is well over 200,000,000.
justrex, there was no buyout PR. It was just a shady scheme to make people like you think there was thus creating a buying frenzy.
The PR meant something entirely different than what you and most thought it meant. The key word in the PR is "offering" (ask, on a foreign exchange) which implies an exchange selling price.
I don't blame you for being confused. JD purposely wrote the PRs to be confusing.
"Grifco International, Inc. said that it has reached an agreement with Lyamec on a $2.25 proposed offering. Filings for either foreign securities registration or U.S securities registration are currently under review."
SH meeting for FTXN merger held at a Mailbox location...LOL. I guess they thought people would be impressed with the Beverly Hills zip code.
http://www.payphone-project.com/mailboxes/90211-0062.html
What I find odd is the continuous rambling and paranoia that never gets to a point.
Of course its unusual. It's a scam. They will say anything that will help prolong the manipulation. Nobody is surprised by such comment considering what Grifco is. If they could have blamed the pps free fall on 9/11 they would of.
Well you need to stop being so cryptic and just come out and say what you need to say. So far you're going around in circles not getting to the point. This isn't Jeopardy.
Justrex, why does all this matter now? IMO, investigating Grifco isn't that difficult. If SEC was investigating it shouldn't take them over a year to gather evidence. Heck, Enron investigation didn't take this long. Conclusion: there is no investigation.
I posted back in 2006 that Jim Dial & Ed Leonard's names were removed off the Officer's list relating to Global Oil Tools. The change was viewed on-line at the Louisiana Secretary of State website. Lyamec subsequently put out a PR about Grifco "relinquishing" it's interest Global to Lyamec. There were a lot of information from independent/credible sources about Grifco and it's operation but most on the boards chose to believe BBB and YesNY.
GFCI website has always been .org. This isn't even a relevant question. When JD and Evan Jarvis put up the website the elected .org since .com & .net was probably already taken.
SEC has bigger fish to fry than to throw their limited resources at a non-operating pinkie scam with no money. In fact, SEC warns investors of dealing with pink sheet companies. Asking SEC to investigate Grifco is like asking the FBI to investigate who stole a piece of gum off your desk at work.
Second, Nevada Corporate veil is hard to pierce. While they can sight the company from wrong doing, it will be difficult to go after Jim Dial. Had it been any other State, the CEO could be held accountable. This is why scam companies incorporate in Nevada. Visa versa, legitimate companies incorporate elsewhere because serious investors will not invest in a Nevada corporations due to accountability issues.
Justerx you should have been asking these questions 2-3 years ago. None of these questions matter now because the company is dead. Jim Dial moved on to other scams. This was a scam plain and simple. Therefore, there are a lot of inaccuracies, misinformation, distortions and unanswered questions. Your just beating a dead horse.
Preferred shares aren't common shares. There is no reason for them to that. Particularly since it was all held by JD.
That's pretty much what it turned out to be right. Do I really have to be present to prove that it was all a scam? The merger with TTII was getting many bag holders excited (one last push to raise the pps). The organizer's blamed message board and naked shorting for the reason of the significant pps drop (in truth is was the massive P & D). The material facts were never disclosed such as GFCI no longer had control of GOTL or there many more shares outstanding. No direct questions were answered by the group. Individual principals gave conflicting accounts in small group meetings.
Ah, good ol Stephan129 a.k.a YesNY11. I'm pretty sure he was part of the scam. Here is the post you're referencing (I have no clue what he's talking about. He often accused posters who questioned JD of shorting GFCI).
Posted by: stephan129 Date: Saturday, February 24, 2007 8:45:52 AM
In reply to: cyofish who wrote msg# 9029 Post # of 11170 [Send a link via email]
Cyo, even if your were right, which you are not, the stockholders of gfci,will get shares in universal, that trade, so they also would be protected from any lawsuit. I must tell you that your group, including your leader olivewizard, are cowards who ran away from a face to face meeting with TRINTY. You and your group had your chance to meet Trinty for which you asked him to join a law suit, to protect the shorts. you and your group have lost all cred on any boards, cowards can bot be believed. Furthermore did you ever notice that you are all short on this board, you just talk to each other like a revival meeting, this board is a JOKE, where are the longs, only sad coward shorts who will not meet with TRINTY
"Good. Then the shareholder meeting in OCT 06 was for what?"
It was a pep rally by the scamsters to get the naive investors renewed reason to hold on, prop up the price, so the scammers could dump a few more million shares to line their pockets. Blowing hot air to the sail so to speak.
According to Dun and Bradstreet GFCI had 3 to 5 employees and Louis Newman (John Jarvis' mother in law) was the President.
I don't know what Blomberg was reporting. Back when they reported GFCI with 22 million Jim Dial claimed 40 million plus. Truth was it was significantly more than that. My original point was GFCI only represented a fraction of 1% to Tobias. They had many other eggs in their basked. In fact GFCI wasn't even an egg...more like a crumb in the Tobias holding basket. So to even imply that GFCI might have been a legit play because Tobias bought it is asinine. If Tobias bought a lottery ticket does that suddenly make playing the lottery a legit investment?
Hard to believe but they did. Tobias had hundreds of millions invested and Grifco only represented $0.001% of their holdings. They had 100s of holdings were legit stocks trading on higher/regulated exchanges with substantial and verifiable assets. They risk/reward was well balanced evident by their rate of return. I'm sure in their risk/reward model they make highly speculative purchases from time to time. Buying Grifco to them was like buying a $1 lottery ticket. I suppose the potential TTII.ob merger had something to do with it. After they seen what it was they sold the following quarter at a big loss.
I'm sure you know who Warren Buffet is. If you see him purchase a lottery ticket in a convenience store, would you spend your entire savings on lottery tickets since Warren bought one?
Nothing was done with Ameritrade. It's expensive and time consuming to pursue the matter. Nobody is willing to put in the time and resources it takes. Grifco is worthless. Transfer Online is probably operating out of someones bedroom. Only thing you'll get out of any effort is the satisfaction that you were right.
Uh...are you pumping another ".pk"? That's like trying sell garlic at a vampire convention.
That was one of the posters grand scheme to "trap the shorts", which wasn't the issue. Distraction was just an unintended consequence. I remember JD even picked up on it and encouraged it so more. Naked short crapola encouraged more buying because the perception was that these naked shorts will be forced to cover and the price would sky rocket..LOL. Some bagholders even set automatic sell order at $3-$4. There were no real precedent in penny stock land of this ever happening but for some reason many of the bag holders thought it was a real possibility with Grifco.
JD played the naked short theorists like a fiddle.