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Pump
DUMP
SCAM
They should file to be audited ---- so we can be put out of our misery
Scam Alert Read ..
Landing Page/Hard Mailer
First, we must start with the newsletter/mailer, the circulation of which is most certainly causing at least a good portion of the buzz surrounding IFAN Financial (OTCPK:IFAN) stock. The newsletter was written by Don McShane, who has supposedly been called a "legend of Wall Street" - by whom, I am not sure. His website has the Latin phrase scimus quid non scimus, which loosely translates as "we know what we do not know." In this journey, I will do my best to live up to Don's words and make sure that you do know what you may not yet know about Don McShane and his stock picking ability as it relates to IFAN Financial.
Before I post the link to his most recent report, the report on IFAN, please allow me to quote from the report itself:
My featured "front page" stock recommendations have a perfect record of 48 winners and zero losers.
He uses this line as bait for readers who might be lulled into a state of euphoria at the prospect of having been added to the mailing list of such a prognosticator. Before you take the bait dangling before you, though, allow me feed you some information that just might suppress your appetite for risk.
While there is little concrete evidence supporting the success of Don's "front page stock recommendations," there is such evidence of his track record when it comes to his recommendations that stemmed from newsletters such as the one you might be looking at regarding an investment in IFAN.
Here are few of his greatest hits from his newsletters/mailers of the past few years:
Don McShane Letter History
The Digital Development Group Corp. (OTCPK:DIDG)??This one was for a company called Digital Development Group. The stock now trades at $0.009.
What if you were lucky enough to get this mailer for Nevada Gold (OTC:NVGC)?
That stock went from 58 cents to 1 cent.
How about this gem, USA Graphite (OTCPK:USGT), which traded as high as 95 cents per share?
How did Don do on this one? USGT now trades at $0.0035.
Still feeling like investing with Don? How about some oil and gas? Legend Oil and Gas (OTCPK:LOGL) was trading at around $2.50 per share before short-sellers exposed all kinds of problems. The company went on to "vigorously deny the allegations..." If you had purchased $10,000 worth of LOGL at $2.50 per share, your investment would today be worth a total of $8, as the stock currently trades at $0.002.
Of course, if you were to liquidate that stock, then you would be charged a commission. That is to say that if you had purchased some of these recommendations from this "legend of Wall Street," you would be left with something very close to zero.
Too bad you weren't on that list that got the "48 winners and zero losers," because this list looks like it is nothing but losers near zero.
At this point, had you invested in these garbage recommendations, you would probably want to know where you can send a complaint to. Alas, Don only lists his P.O. box in Palm Beach, Florida, as a contact (here):
The McShane Letter?P.O. Box 3244?Palm Beach, FL 33480
Lucky for you, I know this address. The bad news is that you will not find Don here. Rather, you will find another man, John Myers, who puts out a similar newsletter/mail service that covers stocks that rival the aforementioned junk. John is proud of the fact that he worked with investment publishers such as Agora in the past. But Agora is a story for another day; feel free to Google it.
Myers has pumped all kinds of penny stocks in the past, including but not limited to these greatest hits:
• Allied American Steel (OTCPK:AAST) - Now trades at $0.0041
• American Power Corp. (OTCPK:AMPW) - Now trades at $0.005
• Harmonic Energy (OTCPK:ASUV) - Now trades at $0.0172
• Centor Energy (OTCPK:CNTO) - Now trades at $0.0389
With the credibility and reliability of the information contained in Don McShane's reports shattered, we can pull back the curtain on his latest pick, IFAN Financial, and dissect it for all its misgivings.
Hard Mailer?Start by opening the page that shows Don McShane's latest mail campaign here.
Now, let me preface this story by saying that there are so many directions in which to go when researching this colossal pile of... well, humor me and try to stick with the story as I jump back and forth so as not to give away too much information in the beginning and thus ruin the tale.
Taking it from the top, I want you to focus on one of the very first lines in the report and remember his words:
For the first time ever, you can now buy products online without having to give your credit card information to anyone - thanks to IFAN Financial Inc's brand-new patented online payment technology.
Now, we could go ahead and end this whole charade by clarifying that single statement, but where is the fun in that? You deserve to get your two cents worth of entertainment from this. After a nice hype job for an opening, Don goes on to say "my featured 'front page' stock recommendations have a perfect record of 48 winners and zero losers." However, as we have seen, many of Don's picks in his newsletters go to one penny or less, which is pretty much worthless after you deduct the commission from the proceeds of the sale at such a price. Don goes on to tout IFAN's technology, while denouncing the practices of credit card providers such as Visa (NYSE:V), American Express (NYSE:AXP), and MasterCard (NYSE:MA) when he says that they "charge e-commerce businesses loan-shark-like rates to process their online transactions - as much as 5%, 8%, even 10% of every transaction."
However, anyone with half a brain knows this is not the industry norm. There are many places to research the real-world costs of merchant services. Here is one of many:
If you're looking for quick numbers, here you go: the average credit card processing cost for a retail business where cards are swiped is roughly 1.95% - 2%. The average cost for card-not-present businesses, such as online shops, is roughly 2.30% - 2.50%.
I think Don was a little confused, and the confusion will continue. He says in one of his green-highlighted bullet points that IFAN saves merchants more than 2% per transaction. Later, Don says that IFAN will only charge 2% per transaction. However, on IFAN's website it shows a cost of only 1.5%. This, of course, begs the question, "How will IFAN ever make any profit at all if it is only charging 1.5% per transaction, when the industry giants can only get the cost to roughly 2.5%? The website also says that it welcomes high-risk accounts - that sounds safe.
Since we are on the website, let's go ahead and bookmark Don's report. We will come back to it in a moment. In the meantime, let's get just a glimpse of the company that Don is touting by taking a closer look at its website.
Pretend you are a merchant who is reading Don's report, and you are interested not only in buying stock, but also in using this revolutionary "for the first time ever" technology for your small business. After all, Don states later in his newsletter that "IFAN lets anyone with a smartphone set up shop and collect payments through IFAN's debit card system." Start here, and then click on the "Learn More About IPIN Pricing and Deposits" link. As you can see, the link takes you here. You must first agree to some sort of NDA thing as an accredited investor who has made over $200,000 or more in each of the two most recent years. So much for opening the doors for anyone with a smartphone!
Photoshop?Before we go back to Don's report, notice some of the window dressing on the website here:
That machine looks snazzy! If that is something that IFAN produces and sells, then I might want in on this after all! Oh wait, look at picture 3 of the QT15 on this page here:
It looks like IFAN just cut-and-pasted this image, and then scribbled through the printing on the receipt, consequently making the product its own.
Next, scroll down and you will see the picture of people paying with their debit card.
Inspiring, but this is from Cluey, an award-winning POS system, with a built in marketing and loyalty system, for bars and restaurants, seen here:
And even at the bottom of the page, the company took that picture from the Square Register website, which you can see here:
IFIN website
Square Register
I could go on and on with the cut-and-paste pictures, but you get the idea. But I want you to focus on one more image from the corporate homepage that I think is worth a thousand words. Do you see that doodad that gets plugged into the cell phone?
Do you notice that the image is not as crisp as you might expect? This is usually caused by a generic and unsophisticated modification of an existing image. Why would IFAN need to manipulate an existing image if that picture represents anything remotely close to proprietary to the company? Perhaps the most obvious conclusion is the correct one: that the device shown on that home page is not proprietary at all. In fact, you can see some very similar objects available for bulk sale here and here:??Be sure to scroll over that device to zoom in so that you can fully appreciate the exact match of those keys on the right-hand side: Fn, X, "triangle," and OK.
Market Cap?Are you yet beginning to feel like you know what you did not know? Hang tight, this is merely the beginning! With a better understanding of what Don is touting, let's go back to his report. Don McShane goes on to give IFAN a $4.50 price target for five months, and a $19 long-term target. He then states that "the company expects that 100,000 units of its IFAN devices will be deployed by Summer 2014."
I have not seen any press releases by the company giving any projections, and I have not seen this projection in any corporate SEC filing. It is very possible that I overlooked this somewhere, but if I did not, then it begs the questions: How does Don know this unless he is in direct contact with management, which is feeding him this information? And if that is true, then is someone in management complicit in all of this? Have more than 100,000 potential merchants signed the NDA, attested to their accredited investor status, viewed the presentation, and purchased a unit? Those are questions to which I do not have the answer, although I would dare to speculate a guess. Soon enough, the company will make another SEC filing regarding its financial condition which covers those summer months.
In contrast, I do have answers that contradict Don's words that explain "why you could potentially retire on IFAN stock." You see, this statement is predicated on Don's misguided understanding of simple math, especially as it relates to finance. He is trying to entice people to buy IFAN stock based on the idea that there are:
... approximately 79 million shares out-standing. With the value of its stock selling for less than $0.50 a share, that means IFAN's total market cap stands around 40 million. If the value of its stock shot up to, say, $2.50 a share, that would still give IFAN a total market cap of only $200 million.
At this point, I am going to deviate from Don's report and begin to truly illuminate the atrocity that is at your doorstep.
Please excuse my recap of elementary financial mathematics for a moment:
Market capitalization = # of shares outstanding * the current market price
The problem for Don, and for anyone considering investing in IFAN based on that math, is that it does not fully account for something called fully diluted market capitalization, which is basically the same formula from above, but adjusted for the conversion of all outstanding convertible notes, preferred stock, options, warrants, etc.
Let's dive in. In the beginning...
Before IFAN Financial was IFAN Financial, it was a company called Infantly Available, Inc. - basically a shell that was formed to sell baby clothes, and it was headed up by a 21-year old woman in Canada who owned 100% of the outstanding stock. I encourage you to dig through all of the old filings, but in case you are too busy, I will provide a timeline that has been cut-and-pasted directly from 10-Q and 10-K filings in chronological order:
The number of shares outstanding of the Registrant's Common Stock as October 17, 2012 was 7,122,030 shares of common stock, $0.001 par value, issued and outstanding.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
Title of Class Name and Address of Beneficial Owner [1] Amount and Nature of Beneficial Owner Percent of Class?Common Stock Danielle Joan Borrie?100 Adriana Louise Drive?Woodbridge, Ontario?Canada , L4H 1P7 7,122,030 100.0%
The number of shares outstanding of the Registrant's Common Stock as December 20, 2012 was 7,122,030 shares of common stock, $0.001 par value, issued and outstanding.
The number of shares outstanding of the Registrant's Common Stock as April 19, 2013 was 7,217,630 shares of common stock, $0.001 par value, issued and outstanding.
The number of shares outstanding of the Registrant's Common Stock as July 12, 2013 was 7,336,030 shares of common stock, $0.001 par value, issued and outstanding.
For the three and nine month periods ending May 31, 2013, the Company has issued 118,400 and 214,000 of its common shares for $0.025 per share under the registration statement effective May 25, 2012. The Company has a total of 7,336,030 common shares issued and outstanding as of May 31, 2013.
** SIDE NOTE - Write down the fact that someone, we do not know who, received 214,000 shares for which they paid $5350.**
The number of shares outstanding of the Registrant's Common Stock as October 17, 2013 was 7,336,030 shares of common stock, $0.001 par value, issued and outstanding.
Common Stock Danielle Joan Borrie?100 Adriana Louise Drive?Woodbridge, Ontario?Canada , L4H 1P7 7,122,030 97.1%
The number of shares outstanding of the Registrant's Common Stock as of January 10, 2014 was 7,336,030 shares of common stock, $0.001 par value, issued and outstanding.
As of April 18, 2014, there were 7,336,030 shares of the registrant's $0.001 par value common stock issued and outstanding.
Okay - that chronicles the time from inception to earlier this year, and we have accounted for all of the outstanding stock. Take a breath.
On April 25, 2014, J. Christopher Mizer acquired control of 7,122,030 restricted shares of the company's issued and outstanding common stock, representing approximately 97.1% of the company's total issued and outstanding common stock, from Danielle Joan Borrie in exchange for $20,000, per the terms of a stock purchase agreement by and between Mr. Mizer and Ms. Borrie.
This is to say that J. Christopher Mizer acquired 100% of the stock owned by Ms. Borrie. Remember that there are still those 214,000 shares out there, and they belong to "Mr. X."
Mr. Mizer then does something that looks quite charitable on the surface, so remember this date: On May 8, 2014, Mizer cancels 6,764,887 of his shares, leaving him with 357,143 shares.
As of July 17, 2014, there were 571,143 (357,143 + 214,000) shares of the registrant's $0.001 par value common stock issued and outstanding.
August 5, 2014: Company executes a 140:1 forward split.?Common stock will increase from 517,143 common shares prior to the forward split to 79,960,020 common shares following the forward split.
With the execution of the forward split, Mizer's 357,143 shares will become 50,000,020 shares and "Mr. X's" 214,000 shares will become 29,960,000 free-trading shares.
On June 6, IFAN acquires MobiCash/Quidme in exchange for 43,000,000 shares. At this point, we have run out of new 10-Qs. So we plug in our own math, much as Don probably did:
• Mizer: 50,000,020
• Mr. X: 29,960,000
• Total OS: 79,960,020
Just as Don said. What did we miss? And why didn't we add in those 43,000,000 shares for the Quidme acquisition?
Go back to this 8-K filing. When Mizer cancelled those 6.7 million common shares, he didn't do that out of the goodness of his heart. According to the filing, Mr. Mizer exchanged those common shares for 600,000 shares of newly created Series A Preferred Stock for himself and 300,000 shares of this same Preferred Stock for a newly appointed board member, Steve Scholl. Remember this name.
On the same day, May 8, 2014, IFAN filed a Certificate of Amendment with the Nevada Secretary of State to increase its authorized capital to 810 million shares. Why did it need to do this, you ask? To account for the insane dilution that comes with the conversion of the Series A Preferred Stock!
On May 8, 2014, the Board of Directors, with the approval of a majority vote of its shareholders, approved the filing of a Certificate of Designation establishing the designations, preferences, limitations, and relative rights of the Company's Series A Preferred Stock (the "Designation" and the "Series A Preferred Stock"). The terms of the Certificate of Designation of the Series A Preferred Stock, which was filed with the State of Nevada on May 8, 2014, include the right to vote, in aggregate, on all shareholder matters, equal to 700 votes per share of Series A Preferred Stock, and each Series A Preferred Stock share is convertible into shares of common stock at a conversion rate of 700 shares of common stock for each one (1) share of Series A Preferred Stock.
Take a minute to appreciate this. Mizer exchanged 6.7 million shares for (600,000 * 700) 420,000,000 shares. His pal Steven Scholl has enough Series A (300,000 shares) to convert to another 210,000,000 common shares.
How about the Quidme acquisition? Check out the top of page 3 on this 8-K filing:
On October 3, 2014, we received the audited financials of Mobicash, America, Inc., and we closed the share exchange by acquiring Mobicash America, Inc. and through an amended Share Exchange Agreement (the "Amended Agreement") we issued the 61,858 shares of our Series A preferred stock to the shareholders of Mobicash America, Inc., d/b/a Quidme.
As a result of these transactions, we have 79,960,020 issued and outstanding common shares at the time of this report and 961,858 shares of Series A preferred stock issued and outstanding.
So, Don is partially correct in stating that there are approximately 79 million shares of IFAN outstanding; however, he neglects to inform his readers that there are also 961,858 issued and outstanding shares of Series A Preferred Stock that, when converted into common stock, will result in a fully diluted share count of approximately 79,960,020 + 673,300,600 = 753,260,620. Hence the need to increase the number of authorized shares to 800 million.
This means that with a current price of just over 60 cents per share, IFAN Financial has a fully diluted market capitalization of nearly half a billion dollars.
If you need to double-check that math, then look at the 8-K on page 30.
Notice the share count for Christopher Menya and Irene Kitimbo, and the corresponding footnotes:
(2) Based on 123,260,620 shares issued and outstanding.?(3) Is based up on the conversion of 45,948 shares of our Series A Preferred Stock.?(4) Is based up on the conversion of 9,278 shares of our Series A Preferred Stock.
Christopher Menya's 45,948 Series A Preferred shares will convert to 32,163,600 (45,948 * 700).
Do you feel like now you know what you did not know? Still in the dark? I have more illumination for you. Grab a drink, we could be here a while, because this is about to go from bad to worse to straight off the cliff and into penny stock oblivion! My simple math lesson turned into a few pages of aggravated assault on IFAN's share structure. Hopefully I did not lose you.
New Internet Consumer Terminal Industry?
If you are still here, then go back to Don's report on IFAN. Just past the egregious share count mistake, Don says that "the company is licensing its patented technology so it can create the new Internet Consumer Terminal (ICT) Industry." This sounds lucrative, does it not? It is going to CREATE something new? First, familiarize yourself with the licensing agreement of which Don speaks. It is located in this 8-K:
On May 15, 2014, Infantly Available, Inc., a Nevada corporation (the "Company") entered into a two (2) year License Agreement (the "License Agreement") with IPIN Debit Network, Inc., a New Brunswick, Canada corporation ("IPIN") for the former's use and distribution of IPIN's technology, systems and products in the nature of electronic payments processing and its United States Letters Patents.
Hmmmm. Don must not have known that iPIN Debit seems to have been trying to do this very thing for at least several years. Steve Scholl could have told him this if Don had only asked. After all, Steve Scholl put iPIN Debit on a start-up funding site in an attempt to raise money for the venture, which was founded in 2011. Or, Don could have looked here.
You should know by now that I want you to zero in on certain things when researching this stuff. Write down the carefully selected wording that they chose to put into quotations, "Cash is King." We will revisit that at the end of our story. Also notice that Canadian-based iPIN Debit was applying to be listed on the London GXG Exchange and then on the Frankfurt Stock Exchange in 2012. Repeated attempts were made to locate any information regarding its listing on either exchange, but nothing meaningful turned up. If you have any information regarding its IPO on those exchanges, then please post it in reply to this article.
At the bottom of that press release, you will see that if you require further information, then you can contact a man named Jeff Atwood. Remember that name.
iPIN Debit even created multiple websites that talk about the ICT Network. Check these out here and here. It has also put out its own press releases about the ICT, as seen here. Notice that this PR, put out by the guys who licensed the technology to IFAN, states what I said earlier about transaction costs:
It will also enable the web merchant to receive a same as cash payment by debit card with PIN or to be paid by the equivalent of a credit card present payment at a rate of 1.85 as opposed to the current 2.5% to 3% standard card not present Internet charges of today.
If that is true, then Don's assertions that standard charges are north of 8% are misleading, at best. It also means that it will be virtually impossible for IFAN to save merchants "more than 2% per transaction," as Don stated.
Now, follow the link at the bottom of the PR that directs you to the company's website. Click on the "Consultants" tab. Do you see a familiar name? There is JT Atwood. But here, I would rather you focus on and remember another name, John DePuy of Oaktree Ventures, who is now the director of IFAN's Quidme acquisition.
Finally, click on the "Contact" tab. Notice that this is a nearly exact replica of the IFAN website. The only difference is that here you are given the "Canada Corporate Office" address:
96 Norwood Avenue, Suite 214?Moncton, New Brunswick E1C 6L9
Also located in this suite, at this address, is an oil and gas exploration company that is quoted on the GXG Exchange in London. Is it also odd that the Ontario Securities Commission would put out a warning about Questus Global Capital Markets that also lists that same address and suite number? I could go on and on with loose ends such as these, but there is so much to say that I should stay focused on the potential scam at hand.
The listing on international exchanges must not have gone as planned, because in 2013, iPIN Debit appeared once again on a crowdfunding website, looking for money (here).
As you can see, the company's goal was to raise $50,000. It came shy of that, raking in a whopping $85. That means that the press release it put out when trying to go public on the London equivalent of the Pink Sheets must not have materialized into anything meaningful. You can read the PR here, where it announces the alliance with the automotive arm of The Torres Group of Victoria, Minnesota.
I figured The Torres Group was a multinational conglomerate comprised of many different arms, but I figured I had better double-check. As you can see, The Torres Group is this.
Allan Torres appears to be the owner of this company. Allan Torres is another story for another day. Feeling like you not only know what you didn't know, but also you have the ability to predict what is coming next?
Start by taking a look at IFAN's corporate headquarters:
5694 Mission Center Road?San Diego, CA 92108
Here is the Street View:?
That is correct - it's a UPS Store. It seems as though these guys don't even have a real office. Who doesn't have a real office? Let's find out.
No due diligence session is complete without taking a look at the people in charge of the business. So, let's first take a look at J. Christopher Mizer. There is plenty of already published information on this guy. The highlight is that he once sat atop BMSN, another heavily promoted penny stock, which now trades at less than one cent per share.
How about Steve Scholl? Steve Scholl runs several companies, including Dr. Horsepower and Dr. Prison. Now, this whole fiasco is a completely different story for another day. It involves all kinds of non-profit organizations. If you want to get a starter course, then you can read these: drhorsepower.blogspot.com; www.drhorsepower.com; www.drprison.org.
When Steve is not managing inmates-to-be and pushing energy drinks in Mexico, you might find him in Switzerland?! Huh?
Check this. Steven Scholl of San Diego, Calif., is listed as part of a company called Pintronic International Network, previously known as GSFS Network Trust Company. What is the GSFS Network Trust Company? See for yourself here.
Notice that a man named Jeff Atwood posted this "pitch" in 2011. Remember Jeff Atwood? What is he "pitching" to people? Seems eerily similar to what IFAN intends to do. Notice point #15:
Exit Strategy: Registration of GSFS Network Trust Company AG on the Frankfurt Stock Exchange.
This pretty much means that if you invest in that, then you will hopefully have the opportunity to sell your shares to someone else via the public markets. What if this was the exit strategy for IFAN? We know of at least 29.96 million shares that could be part of such an "exit strategy," and more than 700,000,000 more to follow those.
There are, of course, a bunch of side stories to all of this, including the formation of Swiss Trust Accounts for Pintronic by these guys. Notice the testimonials given by Pintronic's Tom Hughes. Tom Hughes is also the owner of its website, as seen here. That is Tom Hughes, of 2703 San Ramon Drive in Ranchos Palos Verdes, Calif. Tom Hughes is also known as "Tom Knowledge," the man behind the non-profit organization Knowledge Preservation. Tom also uses crowdfunding to raise money for his ventures, as seen here.
As you can see, he came up only $799,890 shy of reaching his $800,000 goal. I have no idea why people do not want to donate to an organization that is going to ensure the preservation of society's knowledge in case of a cataclysmic event, such as an asteroid hitting Earth. Moving along. Did you notice that JT Atwood is on the Knowledge Preservation team? Starting to see a pattern of incest yet?
This brings us back to the beginning, when Don McShane told us that...
For the first time ever, you can now buy products online without having to give your credit card information to anyone - thanks to IFAN Financial Inc's brand-new, patented online payment technology.
I think that we have seen that the iPIN Debit, aka GSFS Network, aka Pintronic, etc. have been trying to do something at least very similar to this for several years. In addition, the industry as a whole seems to be evolving at a rapid pace, and given the state of IFAN's financial affairs (which we will address soon enough), I see no possible way that it can compete with the major players in the space. See for yourself here:
When a consumer uses their debit card at a participating merchant, PaySecure's patented, graphical PIN-pad appears at the checkout for the option of PIN entry if the debit card can be used with a PIN.
If that is not bad enough, how would you like to have a few thousand dollars in the bank and have to create a technology that would compete with Apple? Apple Pay seems to be addressing a lot of the credit/debit card security issues that Don thinks are the key to IFAN's success. You can read about Apple Pay here, and more in-depth here:
The article even talks about the future of the industry:
Future: On one hand, the future is bright. Next year, America is finally adopting a new, more secure kind of credit card, called EMV (Europay-MasterCard-Visa). It's the kind they already use in Europe, the kind with a chip, the kind that can require you to type a security code to confirm purchase, the kind that would have prevented the Target or Home Depot card thefts. To prepare for the EMV revolution, thousands of U.S. merchants are already planning to upgrade their card-reading systems - which will become Apple Pay-compatible in the process.
I highly doubt that IFAN can compete with the rapidly changing environment when it states in its very own 10-Q filed with the SEC that it had ZERO cash on May 31, 2014. Have you ever tried to grow a tech company with zero cash? It has to be a challenge.
Infantly Available, Inc.?(A Development Stage Company)?CONDENSED BALANCE SHEETS
May 31, 2014 - August 31, 2013 - Unaudited
CURRENT ASSETS
• Cash $ - $1,355
• Prepaid expense 66,620 0
• TOTAL CURRENT ASSETS 66,620 1,355
OTHER ASSETS
• Investment 164,521 0
• Intangible assets 10,000 0
• TOTAL OTHER ASSETS 174,521 0
• TOTAL ASSETS $241,141 $1,355
True, it recently acquired MobiCash America, and this, too, is another story for another day. In the meantime, the only thing of importance that I see is MobiCash's balance statement, as seen in the 8-K filing with the SEC:
MOBICASH AMERICA, INC.?BALANCE SHEET?(A Development Stage Company)
ASSETS - August 31, 2013
• Current Asset - Cash $4,691
• Equipment, net 9,524
• Total Assets $14,215
This is borderline absurd. Perhaps the most important piece to the puzzle of investing is analyzing a company's ability to grow through the use of its assets. Why did Don McShane never mention one thing about IFAN's seemingly destitute financial position? Probably because he knew that if he showed you what I just showed you, then you would use his newsletter to start a nice fire and roast some marshmallows.
Before we move into the final act of the evening, take a moment to reflect on the fully diluted market capitalization of IFAN as it approaches half a billion dollars. Let that soak in as you revisit those balance sheets, as you think about the people at the helm of this operation, and as you try to fully grasp the global attempt of these clowns to capitalize on this through crowdfunding, international stock exchanges, etc.
Final Stretch of Destruction
As we come to the end, let me once again iterate the fact that Don McShane wants you to believe that this whole charade is something new. I said in the beginning that we could end it all by challenging that one statement. Since we have had our fun, let's go ahead and drive the point home.
Who is Tom Knowledge, aka Tom Hughes? This story is also a story in and of itself. He is tied to things like Zowie, which is a trademark registered to Pintronic. Who is this man, and why is he so important to understanding what I believe is really at the crux of this whole mess? Tom Hughes is actually Thomas Hughes - Thomas S. Hughes, to be more exact. He is the guy who signed IFAN's 8-K as the chief technology officer of iPIN Debit Network, Inc. Thomas S. Hughes is actually Thomas Stephen Hughes. You might be able to find some information on the Federal Bureau of Prisons website here. Be sure to use BOP Register Number 24508-112.
As you can see, Tom was released in May 2007. At first, you have to wonder if he gave Steve Scholl the idea for Dr. Prison, or if perhaps Steve counseled Tom. Chicken and the egg, it is irrelevant. The bigger question is why am I looking at the Federal Prisons website? Thomas Stephen Hughes was locked up in the early 2000s, after taking part in one of stock trading's most memorable pump and dump stories (and if you are going to trade penny stocks, then I highly suggest you study that complete story by Googling "ECNC Scam") involving a little company in Southern California, ironically not too far from IFAN's HQ, that specialized in ATM cards with PIN and smart cards. You can read from the ECNC filing here:
The business of eConnect is to develop and profit from the PERFECT industry. Personal Encrypted Remote Financial Electronic Card Technologies is simply the usage of hardware (terminals) from remote sites such as a home, to pay web merchants by swiped credit cards, ATM cards with PIN and smart cards.
I encourage you to read about halfway through page 5 of this filing that reads:
The concept that "cash is king" now applies for the first time to Internet commerce which until now has been limited to credit card transactions.
You should remember a very similar quotation from the aforementioned iPIN Debit press release. I bring this up because it is my belief that this is a rehashed story from the players to the verbiage and right down to the so-called technology itself.
In order to make that last statement make sense, pull up the IFAN 8-K filing that outlines the licensing agreement with iPIN Debit Network: Scroll down to Schedule A on page 10:
1. Intellectual Property
1.1?The inventions, systems, methods, apparatuses, techniques, and know-how embodied in the following pending patent applications and/or issued patents: U.S. Patents 5,336,870 and 5,809,143.
Now, pull up this 10-K filing for Eye Cash Networks (ECNC's predecessor) for the year 1999:
A few pages down, you will get to the crux of the matter:
The Registrant has contracted exclusive licenses for global usage of Patent No. 5,336,870, issued August 8, 1994, Patent No. 5,754,655, issued May 19, 1998, and Patent No. 5,809,143, issued September 15, 1998 (see Exhibit 99.1 to this Form 10-KSB). These three Patents broadly cover the implementation of what the Registrant is now calling "Bank Eyes Only" transactions.
As you can see, it appears as though Don McShane's touting of "IFAN Financial Inc.'s brand-new, patented online payment technology" is simply a rehash of a 15-year old deal, using patents that are as old as 2 decades, issued to a man who then used them to merge into a public shell (which, ironically, was called Leggoons and was formed to sell clothes, much like IFAN's shell was originally formed to sell baby clothes) that was then used to facilitate one of the most infamous pump and dumps of all time, earning the man behind it all, Thomas Hughes, a trip to Federal Prison (see here). As part of his sentencing, "The Court also prohibited Hughes from acting as an officer or director of a publicly-traded company." This most likely explains why iPIN Debit sought listing on the GXG and Frankfurt exchanges. I am guessing that things must have really derailed and these guys must really be desperate to allow Tom to have ties to a public company in the United States again.
In the end, we know that there are close to 30,000,000 shares in the hands of some unknown persons that could be dumped at any time on the market. In addition to those shares, we now know about the massive dilution that is coming down the pike. We also know that someone outside the USA paid Don McShane to tout IFAN stock to unsuspecting folk. We know that Don McShane's track record when it comes to these penny stocks is abysmal. We know that the company itself has all kinds of financial woes, and that the people running the show are not the most astute people on earth. We know that the so-called technology is decades old and was used as part of an investment scam that cost the public a gross amount and the man behind it all years in prison. We know all of this just by not believing what Don McShane told us; by simply challenging his words.
My favorite part of Don's newsletter was the part in which he quoted Forrest Gump and said that if you buy IFAN, then you "don't have to worry 'bout money no more." That is probably true, because if IFAN turns out like many of Don's other penny stock picks, then you will not have any money left about which to worry.
Let me close by agreeing with Forrest Gump that "stupid is as stupid does." No matter how smart you might think you are, you are only as smart as the things that you do. In my opinion, this makes Don and anyone else who believes in IFAN pretty stupid.
Scimus omnes - "We know all."
Disclosure: The author is short IFAN.
The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it (other than from Seeking Alpha). The author has no business relationship with any company whose stock is mentioned in this article.
Where can i Short this stock.
.Please someone tell me..
Broke open the Piggy Bank to load up at 1.94
Short sell...Please someone tell where I can short this scamming pos
PAINT ... The tape
Scam Alert Read ..
Landing Page/Hard Mailer
First, we must start with the newsletter/mailer, the circulation of which is most certainly causing at least a good portion of the buzz surrounding IFAN Financial (OTCPK:IFAN) stock. The newsletter was written by Don McShane, who has supposedly been called a "legend of Wall Street" - by whom, I am not sure. His website has the Latin phrase scimus quid non scimus, which loosely translates as "we know what we do not know." In this journey, I will do my best to live up to Don's words and make sure that you do know what you may not yet know about Don McShane and his stock picking ability as it relates to IFAN Financial.
Before I post the link to his most recent report, the report on IFAN, please allow me to quote from the report itself:
My featured "front page" stock recommendations have a perfect record of 48 winners and zero losers.
He uses this line as bait for readers who might be lulled into a state of euphoria at the prospect of having been added to the mailing list of such a prognosticator. Before you take the bait dangling before you, though, allow me feed you some information that just might suppress your appetite for risk.
While there is little concrete evidence supporting the success of Don's "front page stock recommendations," there is such evidence of his track record when it comes to his recommendations that stemmed from newsletters such as the one you might be looking at regarding an investment in IFAN.
Here are few of his greatest hits from his newsletters/mailers of the past few years:
Don McShane Letter History
The Digital Development Group Corp. (OTCPK:DIDG)??This one was for a company called Digital Development Group. The stock now trades at $0.009.
What if you were lucky enough to get this mailer for Nevada Gold (OTC:NVGC)?
That stock went from 58 cents to 1 cent.
How about this gem, USA Graphite (OTCPK:USGT), which traded as high as 95 cents per share?
How did Don do on this one? USGT now trades at $0.0035.
Still feeling like investing with Don? How about some oil and gas? Legend Oil and Gas (OTCPK:LOGL) was trading at around $2.50 per share before short-sellers exposed all kinds of problems. The company went on to "vigorously deny the allegations..." If you had purchased $10,000 worth of LOGL at $2.50 per share, your investment would today be worth a total of $8, as the stock currently trades at $0.002.
Of course, if you were to liquidate that stock, then you would be charged a commission. That is to say that if you had purchased some of these recommendations from this "legend of Wall Street," you would be left with something very close to zero.
Too bad you weren't on that list that got the "48 winners and zero losers," because this list looks like it is nothing but losers near zero.
At this point, had you invested in these garbage recommendations, you would probably want to know where you can send a complaint to. Alas, Don only lists his P.O. box in Palm Beach, Florida, as a contact (here):
The McShane Letter?P.O. Box 3244?Palm Beach, FL 33480
Lucky for you, I know this address. The bad news is that you will not find Don here. Rather, you will find another man, John Myers, who puts out a similar newsletter/mail service that covers stocks that rival the aforementioned junk. John is proud of the fact that he worked with investment publishers such as Agora in the past. But Agora is a story for another day; feel free to Google it.
Myers has pumped all kinds of penny stocks in the past, including but not limited to these greatest hits:
• Allied American Steel (OTCPK:AAST) - Now trades at $0.0041
• American Power Corp. (OTCPK:AMPW) - Now trades at $0.005
• Harmonic Energy (OTCPK:ASUV) - Now trades at $0.0172
• Centor Energy (OTCPK:CNTO) - Now trades at $0.0389
With the credibility and reliability of the information contained in Don McShane's reports shattered, we can pull back the curtain on his latest pick, IFAN Financial, and dissect it for all its misgivings.
Hard Mailer?Start by opening the page that shows Don McShane's latest mail campaign here.
Now, let me preface this story by saying that there are so many directions in which to go when researching this colossal pile of... well, humor me and try to stick with the story as I jump back and forth so as not to give away too much information in the beginning and thus ruin the tale.
Taking it from the top, I want you to focus on one of the very first lines in the report and remember his words:
For the first time ever, you can now buy products online without having to give your credit card information to anyone - thanks to IFAN Financial Inc's brand-new patented online payment technology.
Now, we could go ahead and end this whole charade by clarifying that single statement, but where is the fun in that? You deserve to get your two cents worth of entertainment from this. After a nice hype job for an opening, Don goes on to say "my featured 'front page' stock recommendations have a perfect record of 48 winners and zero losers." However, as we have seen, many of Don's picks in his newsletters go to one penny or less, which is pretty much worthless after you deduct the commission from the proceeds of the sale at such a price. Don goes on to tout IFAN's technology, while denouncing the practices of credit card providers such as Visa (NYSE:V), American Express (NYSE:AXP), and MasterCard (NYSE:MA) when he says that they "charge e-commerce businesses loan-shark-like rates to process their online transactions - as much as 5%, 8%, even 10% of every transaction."
However, anyone with half a brain knows this is not the industry norm. There are many places to research the real-world costs of merchant services. Here is one of many:
If you're looking for quick numbers, here you go: the average credit card processing cost for a retail business where cards are swiped is roughly 1.95% - 2%. The average cost for card-not-present businesses, such as online shops, is roughly 2.30% - 2.50%.
I think Don was a little confused, and the confusion will continue. He says in one of his green-highlighted bullet points that IFAN saves merchants more than 2% per transaction. Later, Don says that IFAN will only charge 2% per transaction. However, on IFAN's website it shows a cost of only 1.5%. This, of course, begs the question, "How will IFAN ever make any profit at all if it is only charging 1.5% per transaction, when the industry giants can only get the cost to roughly 2.5%? The website also says that it welcomes high-risk accounts - that sounds safe.
Since we are on the website, let's go ahead and bookmark Don's report. We will come back to it in a moment. In the meantime, let's get just a glimpse of the company that Don is touting by taking a closer look at its website.
Pretend you are a merchant who is reading Don's report, and you are interested not only in buying stock, but also in using this revolutionary "for the first time ever" technology for your small business. After all, Don states later in his newsletter that "IFAN lets anyone with a smartphone set up shop and collect payments through IFAN's debit card system." Start here, and then click on the "Learn More About IPIN Pricing and Deposits" link. As you can see, the link takes you here. You must first agree to some sort of NDA thing as an accredited investor who has made over $200,000 or more in each of the two most recent years. So much for opening the doors for anyone with a smartphone!
Photoshop?Before we go back to Don's report, notice some of the window dressing on the website here:
That machine looks snazzy! If that is something that IFAN produces and sells, then I might want in on this after all! Oh wait, look at picture 3 of the QT15 on this page here:
It looks like IFAN just cut-and-pasted this image, and then scribbled through the printing on the receipt, consequently making the product its own.
Next, scroll down and you will see the picture of people paying with their debit card.
Inspiring, but this is from Cluey, an award-winning POS system, with a built in marketing and loyalty system, for bars and restaurants, seen here:
And even at the bottom of the page, the company took that picture from the Square Register website, which you can see here:
IFIN website
Square Register
I could go on and on with the cut-and-paste pictures, but you get the idea. But I want you to focus on one more image from the corporate homepage that I think is worth a thousand words. Do you see that doodad that gets plugged into the cell phone?
Do you notice that the image is not as crisp as you might expect? This is usually caused by a generic and unsophisticated modification of an existing image. Why would IFAN need to manipulate an existing image if that picture represents anything remotely close to proprietary to the company? Perhaps the most obvious conclusion is the correct one: that the device shown on that home page is not proprietary at all. In fact, you can see some very similar objects available for bulk sale here and here:??Be sure to scroll over that device to zoom in so that you can fully appreciate the exact match of those keys on the right-hand side: Fn, X, "triangle," and OK.
Market Cap?Are you yet beginning to feel like you know what you did not know? Hang tight, this is merely the beginning! With a better understanding of what Don is touting, let's go back to his report. Don McShane goes on to give IFAN a $4.50 price target for five months, and a $19 long-term target. He then states that "the company expects that 100,000 units of its IFAN devices will be deployed by Summer 2014."
I have not seen any press releases by the company giving any projections, and I have not seen this projection in any corporate SEC filing. It is very possible that I overlooked this somewhere, but if I did not, then it begs the questions: How does Don know this unless he is in direct contact with management, which is feeding him this information? And if that is true, then is someone in management complicit in all of this? Have more than 100,000 potential merchants signed the NDA, attested to their accredited investor status, viewed the presentation, and purchased a unit? Those are questions to which I do not have the answer, although I would dare to speculate a guess. Soon enough, the company will make another SEC filing regarding its financial condition which covers those summer months.
In contrast, I do have answers that contradict Don's words that explain "why you could potentially retire on IFAN stock." You see, this statement is predicated on Don's misguided understanding of simple math, especially as it relates to finance. He is trying to entice people to buy IFAN stock based on the idea that there are:
... approximately 79 million shares out-standing. With the value of its stock selling for less than $0.50 a share, that means IFAN's total market cap stands around 40 million. If the value of its stock shot up to, say, $2.50 a share, that would still give IFAN a total market cap of only $200 million.
At this point, I am going to deviate from Don's report and begin to truly illuminate the atrocity that is at your doorstep.
Please excuse my recap of elementary financial mathematics for a moment:
Market capitalization = # of shares outstanding * the current market price
The problem for Don, and for anyone considering investing in IFAN based on that math, is that it does not fully account for something called fully diluted market capitalization, which is basically the same formula from above, but adjusted for the conversion of all outstanding convertible notes, preferred stock, options, warrants, etc.
Let's dive in. In the beginning...
Before IFAN Financial was IFAN Financial, it was a company called Infantly Available, Inc. - basically a shell that was formed to sell baby clothes, and it was headed up by a 21-year old woman in Canada who owned 100% of the outstanding stock. I encourage you to dig through all of the old filings, but in case you are too busy, I will provide a timeline that has been cut-and-pasted directly from 10-Q and 10-K filings in chronological order:
The number of shares outstanding of the Registrant's Common Stock as October 17, 2012 was 7,122,030 shares of common stock, $0.001 par value, issued and outstanding.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
Title of Class Name and Address of Beneficial Owner [1] Amount and Nature of Beneficial Owner Percent of Class?Common Stock Danielle Joan Borrie?100 Adriana Louise Drive?Woodbridge, Ontario?Canada , L4H 1P7 7,122,030 100.0%
The number of shares outstanding of the Registrant's Common Stock as December 20, 2012 was 7,122,030 shares of common stock, $0.001 par value, issued and outstanding.
The number of shares outstanding of the Registrant's Common Stock as April 19, 2013 was 7,217,630 shares of common stock, $0.001 par value, issued and outstanding.
The number of shares outstanding of the Registrant's Common Stock as July 12, 2013 was 7,336,030 shares of common stock, $0.001 par value, issued and outstanding.
For the three and nine month periods ending May 31, 2013, the Company has issued 118,400 and 214,000 of its common shares for $0.025 per share under the registration statement effective May 25, 2012. The Company has a total of 7,336,030 common shares issued and outstanding as of May 31, 2013.
** SIDE NOTE - Write down the fact that someone, we do not know who, received 214,000 shares for which they paid $5350.**
The number of shares outstanding of the Registrant's Common Stock as October 17, 2013 was 7,336,030 shares of common stock, $0.001 par value, issued and outstanding.
Common Stock Danielle Joan Borrie?100 Adriana Louise Drive?Woodbridge, Ontario?Canada , L4H 1P7 7,122,030 97.1%
The number of shares outstanding of the Registrant's Common Stock as of January 10, 2014 was 7,336,030 shares of common stock, $0.001 par value, issued and outstanding.
As of April 18, 2014, there were 7,336,030 shares of the registrant's $0.001 par value common stock issued and outstanding.
Okay - that chronicles the time from inception to earlier this year, and we have accounted for all of the outstanding stock. Take a breath.
On April 25, 2014, J. Christopher Mizer acquired control of 7,122,030 restricted shares of the company's issued and outstanding common stock, representing approximately 97.1% of the company's total issued and outstanding common stock, from Danielle Joan Borrie in exchange for $20,000, per the terms of a stock purchase agreement by and between Mr. Mizer and Ms. Borrie.
This is to say that J. Christopher Mizer acquired 100% of the stock owned by Ms. Borrie. Remember that there are still those 214,000 shares out there, and they belong to "Mr. X."
Mr. Mizer then does something that looks quite charitable on the surface, so remember this date: On May 8, 2014, Mizer cancels 6,764,887 of his shares, leaving him with 357,143 shares.
As of July 17, 2014, there were 571,143 (357,143 + 214,000) shares of the registrant's $0.001 par value common stock issued and outstanding.
August 5, 2014: Company executes a 140:1 forward split.?Common stock will increase from 517,143 common shares prior to the forward split to 79,960,020 common shares following the forward split.
With the execution of the forward split, Mizer's 357,143 shares will become 50,000,020 shares and "Mr. X's" 214,000 shares will become 29,960,000 free-trading shares.
On June 6, IFAN acquires MobiCash/Quidme in exchange for 43,000,000 shares. At this point, we have run out of new 10-Qs. So we plug in our own math, much as Don probably did:
• Mizer: 50,000,020
• Mr. X: 29,960,000
• Total OS: 79,960,020
Just as Don said. What did we miss? And why didn't we add in those 43,000,000 shares for the Quidme acquisition?
Go back to this 8-K filing. When Mizer cancelled those 6.7 million common shares, he didn't do that out of the goodness of his heart. According to the filing, Mr. Mizer exchanged those common shares for 600,000 shares of newly created Series A Preferred Stock for himself and 300,000 shares of this same Preferred Stock for a newly appointed board member, Steve Scholl. Remember this name.
On the same day, May 8, 2014, IFAN filed a Certificate of Amendment with the Nevada Secretary of State to increase its authorized capital to 810 million shares. Why did it need to do this, you ask? To account for the insane dilution that comes with the conversion of the Series A Preferred Stock!
On May 8, 2014, the Board of Directors, with the approval of a majority vote of its shareholders, approved the filing of a Certificate of Designation establishing the designations, preferences, limitations, and relative rights of the Company's Series A Preferred Stock (the "Designation" and the "Series A Preferred Stock"). The terms of the Certificate of Designation of the Series A Preferred Stock, which was filed with the State of Nevada on May 8, 2014, include the right to vote, in aggregate, on all shareholder matters, equal to 700 votes per share of Series A Preferred Stock, and each Series A Preferred Stock share is convertible into shares of common stock at a conversion rate of 700 shares of common stock for each one (1) share of Series A Preferred Stock.
Take a minute to appreciate this. Mizer exchanged 6.7 million shares for (600,000 * 700) 420,000,000 shares. His pal Steven Scholl has enough Series A (300,000 shares) to convert to another 210,000,000 common shares.
How about the Quidme acquisition? Check out the top of page 3 on this 8-K filing:
On October 3, 2014, we received the audited financials of Mobicash, America, Inc., and we closed the share exchange by acquiring Mobicash America, Inc. and through an amended Share Exchange Agreement (the "Amended Agreement") we issued the 61,858 shares of our Series A preferred stock to the shareholders of Mobicash America, Inc., d/b/a Quidme.
As a result of these transactions, we have 79,960,020 issued and outstanding common shares at the time of this report and 961,858 shares of Series A preferred stock issued and outstanding.
So, Don is partially correct in stating that there are approximately 79 million shares of IFAN outstanding; however, he neglects to inform his readers that there are also 961,858 issued and outstanding shares of Series A Preferred Stock that, when converted into common stock, will result in a fully diluted share count of approximately 79,960,020 + 673,300,600 = 753,260,620. Hence the need to increase the number of authorized shares to 800 million.
This means that with a current price of just over 60 cents per share, IFAN Financial has a fully diluted market capitalization of nearly half a billion dollars.
If you need to double-check that math, then look at the 8-K on page 30.
Notice the share count for Christopher Menya and Irene Kitimbo, and the corresponding footnotes:
(2) Based on 123,260,620 shares issued and outstanding.?(3) Is based up on the conversion of 45,948 shares of our Series A Preferred Stock.?(4) Is based up on the conversion of 9,278 shares of our Series A Preferred Stock.
Christopher Menya's 45,948 Series A Preferred shares will convert to 32,163,600 (45,948 * 700).
Do you feel like now you know what you did not know? Still in the dark? I have more illumination for you. Grab a drink, we could be here a while, because this is about to go from bad to worse to straight off the cliff and into penny stock oblivion! My simple math lesson turned into a few pages of aggravated assault on IFAN's share structure. Hopefully I did not lose you.
New Internet Consumer Terminal Industry?
If you are still here, then go back to Don's report on IFAN. Just past the egregious share count mistake, Don says that "the company is licensing its patented technology so it can create the new Internet Consumer Terminal (ICT) Industry." This sounds lucrative, does it not? It is going to CREATE something new? First, familiarize yourself with the licensing agreement of which Don speaks. It is located in this 8-K:
On May 15, 2014, Infantly Available, Inc., a Nevada corporation (the "Company") entered into a two (2) year License Agreement (the "License Agreement") with IPIN Debit Network, Inc., a New Brunswick, Canada corporation ("IPIN") for the former's use and distribution of IPIN's technology, systems and products in the nature of electronic payments processing and its United States Letters Patents.
Hmmmm. Don must not have known that iPIN Debit seems to have been trying to do this very thing for at least several years. Steve Scholl could have told him this if Don had only asked. After all, Steve Scholl put iPIN Debit on a start-up funding site in an attempt to raise money for the venture, which was founded in 2011. Or, Don could have looked here.
You should know by now that I want you to zero in on certain things when researching this stuff. Write down the carefully selected wording that they chose to put into quotations, "Cash is King." We will revisit that at the end of our story. Also notice that Canadian-based iPIN Debit was applying to be listed on the London GXG Exchange and then on the Frankfurt Stock Exchange in 2012. Repeated attempts were made to locate any information regarding its listing on either exchange, but nothing meaningful turned up. If you have any information regarding its IPO on those exchanges, then please post it in reply to this article.
At the bottom of that press release, you will see that if you require further information, then you can contact a man named Jeff Atwood. Remember that name.
iPIN Debit even created multiple websites that talk about the ICT Network. Check these out here and here. It has also put out its own press releases about the ICT, as seen here. Notice that this PR, put out by the guys who licensed the technology to IFAN, states what I said earlier about transaction costs:
It will also enable the web merchant to receive a same as cash payment by debit card with PIN or to be paid by the equivalent of a credit card present payment at a rate of 1.85 as opposed to the current 2.5% to 3% standard card not present Internet charges of today.
If that is true, then Don's assertions that standard charges are north of 8% are misleading, at best. It also means that it will be virtually impossible for IFAN to save merchants "more than 2% per transaction," as Don stated.
Now, follow the link at the bottom of the PR that directs you to the company's website. Click on the "Consultants" tab. Do you see a familiar name? There is JT Atwood. But here, I would rather you focus on and remember another name, John DePuy of Oaktree Ventures, who is now the director of IFAN's Quidme acquisition.
Finally, click on the "Contact" tab. Notice that this is a nearly exact replica of the IFAN website. The only difference is that here you are given the "Canada Corporate Office" address:
96 Norwood Avenue, Suite 214?Moncton, New Brunswick E1C 6L9
Also located in this suite, at this address, is an oil and gas exploration company that is quoted on the GXG Exchange in London. Is it also odd that the Ontario Securities Commission would put out a warning about Questus Global Capital Markets that also lists that same address and suite number? I could go on and on with loose ends such as these, but there is so much to say that I should stay focused on the potential scam at hand.
The listing on international exchanges must not have gone as planned, because in 2013, iPIN Debit appeared once again on a crowdfunding website, looking for money (here).
As you can see, the company's goal was to raise $50,000. It came shy of that, raking in a whopping $85. That means that the press release it put out when trying to go public on the London equivalent of the Pink Sheets must not have materialized into anything meaningful. You can read the PR here, where it announces the alliance with the automotive arm of The Torres Group of Victoria, Minnesota.
I figured The Torres Group was a multinational conglomerate comprised of many different arms, but I figured I had better double-check. As you can see, The Torres Group is this.
Allan Torres appears to be the owner of this company. Allan Torres is another story for another day. Feeling like you not only know what you didn't know, but also you have the ability to predict what is coming next?
Start by taking a look at IFAN's corporate headquarters:
5694 Mission Center Road?San Diego, CA 92108
Here is the Street View:?
That is correct - it's a UPS Store. It seems as though these guys don't even have a real office. Who doesn't have a real office? Let's find out.
No due diligence session is complete without taking a look at the people in charge of the business. So, let's first take a look at J. Christopher Mizer. There is plenty of already published information on this guy. The highlight is that he once sat atop BMSN, another heavily promoted penny stock, which now trades at less than one cent per share.
How about Steve Scholl? Steve Scholl runs several companies, including Dr. Horsepower and Dr. Prison. Now, this whole fiasco is a completely different story for another day. It involves all kinds of non-profit organizations. If you want to get a starter course, then you can read these: drhorsepower.blogspot.com; www.drhorsepower.com; www.drprison.org.
When Steve is not managing inmates-to-be and pushing energy drinks in Mexico, you might find him in Switzerland?! Huh?
Check this. Steven Scholl of San Diego, Calif., is listed as part of a company called Pintronic International Network, previously known as GSFS Network Trust Company. What is the GSFS Network Trust Company? See for yourself here.
Notice that a man named Jeff Atwood posted this "pitch" in 2011. Remember Jeff Atwood? What is he "pitching" to people? Seems eerily similar to what IFAN intends to do. Notice point #15:
Exit Strategy: Registration of GSFS Network Trust Company AG on the Frankfurt Stock Exchange.
This pretty much means that if you invest in that, then you will hopefully have the opportunity to sell your shares to someone else via the public markets. What if this was the exit strategy for IFAN? We know of at least 29.96 million shares that could be part of such an "exit strategy," and more than 700,000,000 more to follow those.
There are, of course, a bunch of side stories to all of this, including the formation of Swiss Trust Accounts for Pintronic by these guys. Notice the testimonials given by Pintronic's Tom Hughes. Tom Hughes is also the owner of its website, as seen here. That is Tom Hughes, of 2703 San Ramon Drive in Ranchos Palos Verdes, Calif. Tom Hughes is also known as "Tom Knowledge," the man behind the non-profit organization Knowledge Preservation. Tom also uses crowdfunding to raise money for his ventures, as seen here.
As you can see, he came up only $799,890 shy of reaching his $800,000 goal. I have no idea why people do not want to donate to an organization that is going to ensure the preservation of society's knowledge in case of a cataclysmic event, such as an asteroid hitting Earth. Moving along. Did you notice that JT Atwood is on the Knowledge Preservation team? Starting to see a pattern of incest yet?
This brings us back to the beginning, when Don McShane told us that...
For the first time ever, you can now buy products online without having to give your credit card information to anyone - thanks to IFAN Financial Inc's brand-new, patented online payment technology.
I think that we have seen that the iPIN Debit, aka GSFS Network, aka Pintronic, etc. have been trying to do something at least very similar to this for several years. In addition, the industry as a whole seems to be evolving at a rapid pace, and given the state of IFAN's financial affairs (which we will address soon enough), I see no possible way that it can compete with the major players in the space. See for yourself here:
When a consumer uses their debit card at a participating merchant, PaySecure's patented, graphical PIN-pad appears at the checkout for the option of PIN entry if the debit card can be used with a PIN.
If that is not bad enough, how would you like to have a few thousand dollars in the bank and have to create a technology that would compete with Apple? Apple Pay seems to be addressing a lot of the credit/debit card security issues that Don thinks are the key to IFAN's success. You can read about Apple Pay here, and more in-depth here:
The article even talks about the future of the industry:
Future: On one hand, the future is bright. Next year, America is finally adopting a new, more secure kind of credit card, called EMV (Europay-MasterCard-Visa). It's the kind they already use in Europe, the kind with a chip, the kind that can require you to type a security code to confirm purchase, the kind that would have prevented the Target or Home Depot card thefts. To prepare for the EMV revolution, thousands of U.S. merchants are already planning to upgrade their card-reading systems - which will become Apple Pay-compatible in the process.
I highly doubt that IFAN can compete with the rapidly changing environment when it states in its very own 10-Q filed with the SEC that it had ZERO cash on May 31, 2014. Have you ever tried to grow a tech company with zero cash? It has to be a challenge.
Infantly Available, Inc.?(A Development Stage Company)?CONDENSED BALANCE SHEETS
May 31, 2014 - August 31, 2013 - Unaudited
CURRENT ASSETS
• Cash $ - $1,355
• Prepaid expense 66,620 0
• TOTAL CURRENT ASSETS 66,620 1,355
OTHER ASSETS
• Investment 164,521 0
• Intangible assets 10,000 0
• TOTAL OTHER ASSETS 174,521 0
• TOTAL ASSETS $241,141 $1,355
True, it recently acquired MobiCash America, and this, too, is another story for another day. In the meantime, the only thing of importance that I see is MobiCash's balance statement, as seen in the 8-K filing with the SEC:
MOBICASH AMERICA, INC.?BALANCE SHEET?(A Development Stage Company)
ASSETS - August 31, 2013
• Current Asset - Cash $4,691
• Equipment, net 9,524
• Total Assets $14,215
This is borderline absurd. Perhaps the most important piece to the puzzle of investing is analyzing a company's ability to grow through the use of its assets. Why did Don McShane never mention one thing about IFAN's seemingly destitute financial position? Probably because he knew that if he showed you what I just showed you, then you would use his newsletter to start a nice fire and roast some marshmallows.
Before we move into the final act of the evening, take a moment to reflect on the fully diluted market capitalization of IFAN as it approaches half a billion dollars. Let that soak in as you revisit those balance sheets, as you think about the people at the helm of this operation, and as you try to fully grasp the global attempt of these clowns to capitalize on this through crowdfunding, international stock exchanges, etc.
Final Stretch of Destruction
As we come to the end, let me once again iterate the fact that Don McShane wants you to believe that this whole charade is something new. I said in the beginning that we could end it all by challenging that one statement. Since we have had our fun, let's go ahead and drive the point home.
Who is Tom Knowledge, aka Tom Hughes? This story is also a story in and of itself. He is tied to things like Zowie, which is a trademark registered to Pintronic. Who is this man, and why is he so important to understanding what I believe is really at the crux of this whole mess? Tom Hughes is actually Thomas Hughes - Thomas S. Hughes, to be more exact. He is the guy who signed IFAN's 8-K as the chief technology officer of iPIN Debit Network, Inc. Thomas S. Hughes is actually Thomas Stephen Hughes. You might be able to find some information on the Federal Bureau of Prisons website here. Be sure to use BOP Register Number 24508-112.
As you can see, Tom was released in May 2007. At first, you have to wonder if he gave Steve Scholl the idea for Dr. Prison, or if perhaps Steve counseled Tom. Chicken and the egg, it is irrelevant. The bigger question is why am I looking at the Federal Prisons website? Thomas Stephen Hughes was locked up in the early 2000s, after taking part in one of stock trading's most memorable pump and dump stories (and if you are going to trade penny stocks, then I highly suggest you study that complete story by Googling "ECNC Scam") involving a little company in Southern California, ironically not too far from IFAN's HQ, that specialized in ATM cards with PIN and smart cards. You can read from the ECNC filing here:
The business of eConnect is to develop and profit from the PERFECT industry. Personal Encrypted Remote Financial Electronic Card Technologies is simply the usage of hardware (terminals) from remote sites such as a home, to pay web merchants by swiped credit cards, ATM cards with PIN and smart cards.
I encourage you to read about halfway through page 5 of this filing that reads:
The concept that "cash is king" now applies for the first time to Internet commerce which until now has been limited to credit card transactions.
You should remember a very similar quotation from the aforementioned iPIN Debit press release. I bring this up because it is my belief that this is a rehashed story from the players to the verbiage and right down to the so-called technology itself.
In order to make that last statement make sense, pull up the IFAN 8-K filing that outlines the licensing agreement with iPIN Debit Network: Scroll down to Schedule A on page 10:
1. Intellectual Property
1.1?The inventions, systems, methods, apparatuses, techniques, and know-how embodied in the following pending patent applications and/or issued patents: U.S. Patents 5,336,870 and 5,809,143.
Now, pull up this 10-K filing for Eye Cash Networks (ECNC's predecessor) for the year 1999:
A few pages down, you will get to the crux of the matter:
The Registrant has contracted exclusive licenses for global usage of Patent No. 5,336,870, issued August 8, 1994, Patent No. 5,754,655, issued May 19, 1998, and Patent No. 5,809,143, issued September 15, 1998 (see Exhibit 99.1 to this Form 10-KSB). These three Patents broadly cover the implementation of what the Registrant is now calling "Bank Eyes Only" transactions.
As you can see, it appears as though Don McShane's touting of "IFAN Financial Inc.'s brand-new, patented online payment technology" is simply a rehash of a 15-year old deal, using patents that are as old as 2 decades, issued to a man who then used them to merge into a public shell (which, ironically, was called Leggoons and was formed to sell clothes, much like IFAN's shell was originally formed to sell baby clothes) that was then used to facilitate one of the most infamous pump and dumps of all time, earning the man behind it all, Thomas Hughes, a trip to Federal Prison (see here). As part of his sentencing, "The Court also prohibited Hughes from acting as an officer or director of a publicly-traded company." This most likely explains why iPIN Debit sought listing on the GXG and Frankfurt exchanges. I am guessing that things must have really derailed and these guys must really be desperate to allow Tom to have ties to a public company in the United States again.
In the end, we know that there are close to 30,000,000 shares in the hands of some unknown persons that could be dumped at any time on the market. In addition to those shares, we now know about the massive dilution that is coming down the pike. We also know that someone outside the USA paid Don McShane to tout IFAN stock to unsuspecting folk. We know that Don McShane's track record when it comes to these penny stocks is abysmal. We know that the company itself has all kinds of financial woes, and that the people running the show are not the most astute people on earth. We know that the so-called technology is decades old and was used as part of an investment scam that cost the public a gross amount and the man behind it all years in prison. We know all of this just by not believing what Don McShane told us; by simply challenging his words.
My favorite part of Don's newsletter was the part in which he quoted Forrest Gump and said that if you buy IFAN, then you "don't have to worry 'bout money no more." That is probably true, because if IFAN turns out like many of Don's other penny stock picks, then you will not have any money left about which to worry.
Let me close by agreeing with Forrest Gump that "stupid is as stupid does." No matter how smart you might think you are, you are only as smart as the things that you do. In my opinion, this makes Don and anyone else who believes in IFAN pretty stupid.
Scimus omnes - "We know all."
Disclosure: The author is short IFAN.
The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it (other than from Seeking Alpha). The author has no business relationship with any company whose stock is mentioned in this article.
Background
IFAN Financial, Inc. (IFAND) (OTCPK:IFAN) was recently featured in the penny-stock newsletter, "The McShane Letter," which touts IFAND's "brand-new technology that lets customers use debit cards online without giving their credit card info…" and that it is likely to be purchased by Apple, Amazon, or Google.
Advertising campaign
IFAN Financial's stock has been featured in the McShane letter, which makes many outrageous claims (with silly graphs and diagrams to boot) and tries to piggyback off of the publicity surrounding security breaches from companies such as Target. However, beyond the ridiculous claims, there is some critical information in the fine print on the last page which reads,
"Mintefor Investments LTD paid three million and five hundred thousand dollars to marketing vendors to pay for all the costs of creating and distributing this Advertisement, including printing and postage, in an effort to build investor and market awareness. Don McShane received twelve thousand dollars for this advertising campaign and expects to receive an unknown amount in subscription revenue. Viewers of this advertisement should understand that trading activity and stock prices in many if not all cases tend to increase during the advertisement campaigns of the profiled company and in many if not all cases tend to decrease thereafter."
So over $3.5 million has been budgeted to market a company which listed $4,586 in current assets and ($558,714) in cash flow from operations in its most recent filings. Frankly, that doesn't make a whole lot of sense.
What is even more puzzling is that Mintefor Investments, LTD is not mentioned anywhere in any of the company's filings - a Google search for the entity simply directs one to the online version of the IFAND mailer, so it appears that it is being independently marketed, or if there is a link between IFAND and Mintefor, it is not made clear to the public.
Business
The problem is, there is not much in the way of a business here, and the claims made in the newsletter are all completely baseless and undocumented. The company's most recent 10-Q, which was filed on July 27, 2014, names the company as "Infantly Available, Inc." and states that it "intends to develop and distribute an organic clothing line designed for children." Of particular interest is that the company's balance sheet lists that the company has no cash.
Another curious note in the company's 10-Q is below,
"On June 6, 2014, the company signed the share exchange agreement with MobiCash America, Inc. D/B/A Quidme. The company will acquire 100% of the issued and outstanding securities of QUIDME in exchange for the issuance of 43,000,000 shares of IFAND common stock, par value $.001 per share. The agreement is conditional upon QUIDME completing its audit. The company will fund $500,000 to support the continued development and commercialization of QUIDME's technology. The final closing of the agreement is contingent on the completion of the financial audit of MobiCash America, Inc."
So the company acquired QUIDME, which it claims will fund $500,000 in order to support the development of its technology, and is now engaged in the business of mobile payment technology. What happened to the baby clothes?
With respect to the company's workforce, in its most recent 8-k filing, the company states, "Other than the foregoing named officers and directors, we have no full-time employees whose services are materially significant to our business and operations who are employed at will by Mobicash America, Inc."
Financials
As of May 31, 2014, Mobicash America, Inc., the company's wholly-owned subsidiary, has cash of $4,586 and total assets of $10,547. It lists $233,704 in liabilities and (228,157) in stockholders' equity. Additionally, it generated a net loss of $307,716 in its most recent quarter. That's not enough cash to pay the rent for a month in a facility, let alone hire a workforce. Hardly the assets required to generate the technology to solve the problem of online credit card fraud.
Bull Case
From a fundamental analysis of IFAND, there doesn't seem to be much there -the balance sheet and financials are weak, and the business plan is not very convincing. Furthermore, the company's stated plan to finance the business through the sale of equity will dilute shareholders. However, poor financials and a less-than-ideal plan does not prevent external investment in the company, and if an adventurous firm or individual were to provide a substantial influx of cash into the business, it would imply some upside to the company's equity value.
Executive holdings
When one gets a look at the executives' holdings listed on page 30 of the company's most recent Form 8-K, things become even more interesting. The top three executives (who are also the only three employees in the company) hold 89.1 million, or 65.8% of the outstanding shares. For every penny that the stock goes up, the top executive earns $350,000. Over the past week, the stock has moved from $0.10 on October 3, 2014 to close at $0.52 on October 27, which would result in a gain of about $35 million in the value of the executives shares. Of course, there's no way that it can all be sold at that value, but it's still impressive compensation considering that management does not receive a salary for running the company. The table below details the executives' holdings.
Conclusion
Given management's substantial holdings, the bombastic and expensive marketing campaign, and any tangible evidence of a sound business, IFAND looks eerily similar to many pump and dump stocks. Anyone considering investing in IFAND should make sure to read the filings very carefully and make themselves aware of the risks associated with investing in penny stocks before committing funds.
Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it (other than from Seeking Alpha). The author has no business relationship with any company whose stock is mentioned in this article.
IFAN Financial: Is Heading To $0
Summary
There is a McShane Letter promotional hard mailer being sent to people's homes.
$3,000,000 stock promotion budget.
29,600,000 free trading shares that could be dumped into the stock promotion.
IFAN Financial (OTCPK:IFAN) (IFAND) is a name that I believe is currently the target of a penny stock promotion scheme. It is my view that the stock's intrinsic value is somewhere near $0, and it is with conviction that I recommend that any investors currently in the name sell the entirety of their stakes immediately. I also believe that IFAN Financial is a stock definitely worth shorting. My track record of identifying and publicly exposing such highly overvalued equities is excellent:
Little Revenue. Debts. No Business. Bright Future?
As is usually the case with these types of hyped-up scams, it takes only one quick glance at the balance sheet to realize that the $46M market capitalization that this equity commands is beyond ludicrous. With $0 cash on hand and $102,948 in total liabilities. It's my suspicion that the purpose of this company is not to succeed, but to sell stock. The recent volume is due to overly bullish promotional mailers. This has a very high risk of an SEC suspension.
Picture of $IFAN Chart
You can see that trading in IFAN Financial started seeing really increased volume on October 10, 2014. You can see it was around this time the landing page went up. Coincidence with the time of the hard mailer and increased volume in IFAN Financial? Absolutely not.
(GBHD) Presented With Tender Take Over Bids..80 cents
Let's make that phone call read the (link) story .. Im a share holder and I was never presented with this offer...
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PR was 11/6/13 share price was .36 and it went up to .40 then retreated back to the .20's
What a Fing Scam ,,
any real offer would of been taken or any real company would of popped and kept it's value ..
Looks like we are at the company's real value now..
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http://www.marketwired.com/press-release/global-holdings-inc-gbhd-presented-with-tender-take-over-bids-pinksheets-gbhd-1849068.htm
Yes... but Short it .. It's all smoke and mirrors
Ouch bid dropped and people fighting to be lowest ask... Trying To get out..
Guess the financials that are due and coming are not only fake but bad also
Wish I had a company that would let me Short this POS scam company
Yea No that's not it .. 3 employee's and they are the 3 Owners ... Who own like 70% of the shares
Don't get who is selling ... Everyone selling at these prices are taking a Lose....
Guess they want the write off
Great Entry price !!!
Buy Buy Buy !!!!
Time to double up
Ouch wtf
WTF !!! Head Fake didn't work ... Let's hope for a stuff arm and we go Beast Mode
Who is Selling and Y ??
Look at the chart... anyone that is selling is taking a Lose
Unless they bought in 10/14 ...
Down goes Fraiser !!!!
Maybe another Mcshane Bogus Mailer could help
Looks like the shine came off the Terd
Great news MulitiNational company is gonna buy us out or merge with us and the Bid Drops to .052
Who is the company Papa ...
If it was anything solid the company's name would of been mentioned
Scam Alert !!! Run to the Hills
Stay Away !!!!
Where can I Buy an ipin ?
Why is there never a name ???
Where can we find this document ??
It's all BS !!!!
Give out names and numbers then u might be taken serous
Till then it's just another Pyramid SCAM
They get Bought Out !!! Or taken over Is what happens when the pile is gone..
Buy Buy Buy !!!! Look at charts .. I have been loading up .45 and under ..
A lot of growth still to happen
Ha Ha I get it Post office .. FBI most wanted photo's ...
I like it !!!
Do u believe it ??
I was able to sell some shares at the Bid !!!
Wow, is there a Heartbeat here ??
Did someone find some new suckers
Any Support level here ? .40 .35 .30
It's hard when 3 people own 70% of the stock
Are the Fins Audited ??
Anyone know ??
Down 22% Y ? Great news today
Classic PUMP & Dump !!!!
Positive News ..Forward looking Statement ..
But Down 22% WOW