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See from this that PwC intends to take depositions from Itronics, if they haven't already: http://investorshub.advfn.com/boards/read_msg.aspx?message_id=86467351
I've watched a few works-out by administrators in hedge fund fraud cases & they are always glacially slow. Apart from a bunch of litigation, there's a whole cumbersome proof of clams process they will need to go through at some point.
Unfortunately in this case the main action is off-shore so you don't get the same visibility you would have if it was all happening in US bankruptcy court. But some info available from their site: http://ajw-group-liquidation.com/index.html
Carnes' prelim response: http://labemp.wordpress.com/2013/12/20/al-responds-to-bcsc-allegations/
Be interesting to follow this.
Great stuff - well done!
Accountant John Kinross-Kennedy sanctioned by SEC: http://www.sec.gov/litigation/admin/2013/34-71154.pdf
Incompetent audits; no understanding of PCAOB requirements.
OTC Markets shows him as currently engaged by BLTF, XTRM, SRDP, TREP.
According to the SEC's findings, he has in the past been engaged by as many as 23 companies at any one time.
May not appear or practice before the commission for five years, after which time he may apply for reinstatement subject to a bunch of conditions. Given that he's now 85 probably safe to assume he's out of action for good :)
XTRM's auditor/accountant, John Kinross-Kennedy, sanctioned by SEC: http://www.sec.gov/litigation/admin/2013/34-71154.pdf
I don't know anything about ITRO, sorry.
In general, I think there are probably many Ribotsky deals where nothing was ever paid and not all share issuance obligations were honored. As I say, at least by the end of the scam, CR's intent IMO in many cases was just to keep the tickers trading & continue to provide market marks he could use to inflate the value of the funds and keep extracting fees from his investors.
I guess PWC may go after some of the portfolio companies to get them to pay up, but from what I've seen, most of them are worthless crud without any value to extract. Given their deposition demands in the bankruptcy action, I guess they'll also look at going after some of the companies' mgt on a personal basis, if they can find evidence of collusion etc.
nir wants to sell shares. that's where they make their money
That's where they made some of their money, but remember that the easier thing was to make money from the fund investors, via management fees: 2% of asset value plus 20% of paper profit, or whatever it was.
The fees were based on the value of the assets as calculated by Ribotsy, essentially. For that he just needed tickers, a market mark and a bunch of securities with conversion features allowing him to book a big paper gain. A note convertible at a 50% discount to the market price? Wow, there's a 100% gain, guaranteed, regardless of share price, liquidity, company viability ...
He wouldn't sue a company for non-payment - why would he? - just roll over the note.
Companies are just tickers to these kind of "investors" - for most of the portfolio he wouldn't have known or cared what the business of the company was supposed to be.
Has anyone [NIR Bagholders] actually received any money from PWC?
That'll take years, probably.
Kaiser sentenced today - $10K fine, less than the $15K plea bargain. Looks like the judge didn't think much of the case.
Kaiser's sentencing memo makes it clear that James A'Hearn was indeed the one who approached Kaiser to work for LP. Interestingly, Kaiser says that they've never met face-to-face.
Judge still hasn't made a restitution decision in the JF/JL criminal cases. Back in October he ordered the DoJ to file the internal taint investigation report on AUSA Victor Wild - the prosecutor in the O'Riordan case; initial lead on the LP/JL/JF cases; director (bizarrely) of penny-scam EVRM and/or one of its subsidiaries, alongside with LP's outside counsel who is also a Tom Murphy associate.
Text of order:
It has come to my attention that the United States Attorneys
Office has publicly announced findings and conclusions by the
United States Department of Justice Office of Professional
Responsibility that suggestions of misconduct by Assistant United
States Attorney Victor Wild related to this case “lack[] factual
support and were without merit.”
This case remains under consideration in this court in
connection with the preparation of a full written explanation
sought by the parties in connection with their noticed cross
appeals concerning the grounds for disposing of post trial
motions. The action and reasoning of the Office of Professional
Responsibility are relevant and perhaps material to the
Memorandum and Order I now have in draft.
Moreover, I have indicated that to the degree the suggestions of misconduct are directed to a sentencing proceeding in a case before Judge Wolf [ie Dan O'Riordan's case],it is my intention to forward to Judge Wolf my Memorandum and Order thereby directing his attention to the relevant filings bythe parties before me. The Office of Professional Responsibility report would be relevant and perhaps material to that referral as well.
Consequently, the government is hereby ORDERED to submit, on
or before October 28, 2013 for docketing in this case, subject to
a motion to seal if impoundment is sought, the report of the
Office of Professional Responsibility regarding Assistant United
States Attorney Wild.
The DoJ filed the report under seal.
Further on dilution: See that they issued 2M common and warrants for another 2M common to MedBridge at end Oct. This is pursuant to the agt between VG and MB under which MB provides "services" valued at a minimum of $20K per month plus $12.5K cash per month under a Line of Credit (LC).
Any amounts advanced .. pursuant to the LC will be convertible at the 20 day average of the Company’s stock price prior to the execution date, and the monthly cost for Services shall be paid in common shares of the Company valued at the average stock price per quarter, discounted by 10%, such share payments to be made on a quarterly basis.
So there's a running overhang of at least $32.5K worth of common share issuance per month.
I think these shares are supposed to be locked up for 2 years. But note that this is all related-party, insider stuff: outside shareholders have effectively no representation on the board (if one discounts, as one should discount IMO, the presence of Haig and his brother).
No guarantee that the terms won't get changed if MB wants them to change (recalling all of the resets to DMBM's conversion price etc in the past); and given VG's bad reporting record, no comfort that outside shareholders will find out about any changes in a timely fashion.
Nothing in this report about how the $862.5K debt to T&T, now overdue, will be paid. Given that the company has gotten ~$1.3M in cash from MBV, why wouldn't T&T demand payment in cash? I guess something less drastic for VG than that will be negotiated, but I imagine things might get pretty dilutive. Eg: even at 20c per share, that debt represents ~4.3M common ...
Thanks; nice clear overview.
That link not working - this instead? http://www.securitieslawyer101.com/sec3a10/
I saw "Blue Jasmine" the other day. Cate Blanchett's character is a brilliant portrayal, brilliantly acted, of this kind of person.
Stabilization for *two* patients? (Out of how many?) WTF are they reporting that for? What could it possibly be supposed to mean? I picture Curiel cringing in embarrassment.
Anyway, the Q3 financials a few days ago - at least they give good detail on the licensing arrangement with S&W for some additional Newell-related IP. No idea whether there is any commercial value to this IP but the licensing terms I think are pretty standard.
Also, they issued "only" 500K new common in the early August - end September period.
Stabilization for *two* patients? (Out of how many?) WTF are they reporting that for? What could it possibly be supposed to mean? I picture Curiel cringing in embarrassment.
Anyway, the Q3 financials a few days ago - at least they give good detail on the licensing arrangement with S&W for some additional Newell-related IP. No idea whether there is any commercial value to this IP but the licensing terms I think are pretty standard.
Also, they issued "only" 500K new common in the early August - end September period.
Injunctions, bars & fines for Shannon and Parish from the Magnetar fiasco. NIR Capital to be dissolved. http://www.sec.gov/litigation/admin/2013/ia-3735.pdf
Banks hiring Chinese princelings is news? Geeze ...
Anyway, an interesting question is how often the banks in question do well out of it, versus how often the princelings make a picnic out of them.
Yep - unless the "sophisticated" scam-bait happens to be managing pension money ...
Sad, the OTCM is facilitating fraud, aiding and abetting.
"Aiding and abetting" might be a bit strong, but I mainly agree. Not dissimilar to IHUB, really. The only saving graces in both cases are (i) entertainment value (ii) by gathering together a lot of the crap into one place, at least there's a bit more visibility on it.
Anybody who stupidly believed in Riad can perhaps console themselves with this story of a "top German businesswoman" who stupidly believed in one of Riad's soul-brothers:
http://www.telegraph.co.uk/news/uknews/law-and-order/10493646/Chief-executive-handed-over-600k-after-being-duped-by-lover-court-hears.html
I'm getting a pretty good sense of what fuels Mr Riad's little ambition-engine ...
That put down is very Arab.
Maybe, but I'm not an Arab and I remember telling somebody that his mother must have had an affair with Mr Ed.
I was 11 years old and not at that time a multi-billionaire or the largest deposit customer of Wells Fargo, however.
Epicene uncreditworthy ocelot?
That's as far as I can take it.
Surely what we really want is for Gary to bring his side of the story public as well, and for them to start slapping at each other like homeless drunks in an alleyway.
I'd like to see what Gary comes up with to top "6 month old mule in a diaper".
Maybe for his subscription to the dating site too?
Their disclaimer shows them taking stock in some cases.
Eg:
•CSRH: QS, an affiliate of DreamTeamGroup, will receive $15,000 per quarter per quarter and 5,000,000 Restricted 144 Shares of Common Stock of CSRH from CSRH for 180 days of advertising, branding, marketing, investor relations and social media services provided by QS. QS will also receive an additional $27,500 for advertising, branding, marketing, investor relations and social media services. QS also previously received 4,500,000 Restricted 144 Shares of Common Stock of CSRH from CSRH for 180 days of advertising, branding, marketing, investor relations and social media services provided by QS. QS intends to sell all of the shares of CSRH Common Stock upon the expiration of the applicable Rule 144 holding period, notwithstanding the fact that QS may be advertising and/or distributing materials on CSRH and its securities at the time of such sale.
I think the SEC has been more effective than the PCAOB at going after dodgy auditors, up until now - more SEC actions than PCAOB sanctions (though I haven't done a count & might be mistaken). If that's correct, hopefully it's changing
I've seen them do the friendly warning thing in cases involving small-time grifters. From their point of view, I can see how launching full-scale actions against people like that might not be a very attractive proposition: lots of chaos to deal with, not a huge public benefit, material opportunity cost in terms of the resources required ...
But who knows?
My guess: A pretty clear indication from the SEC that if he filed a 10-K showing the fake bonds having any value, a formal investigation would be a strong possibility.
As always, I'm more interested in whether something will happen to the valuation experts - care more about the gatekeepers than the grifters ....
Nice to see a bunch of PCAOB actions ...
Hood & Associates, and audit partner Rick Freeman zapped by the PCAOB for bogus audits on FULO, RMCP, NGHT: http://pcaobus.org/Enforcement/Decisions/Documents/11212013_Hood.pdf
Harris F Rattray CPA, PL and Rattray himself zapped for bogus audits on PPRG, SPLI, AQUM: http://pcaobus.org/Enforcement/Decisions/Documents/11212013_Rattray.pdf
Acquavella, Chiarelli, Shuster, Berkower & Co., LLP and former partner David T. Svoboda zapped for UTVL, HSYT, Sinocom Pharma: http://pcaobus.org/Enforcement/Decisions/Documents/11212013_Acquavella.pdf
NGHT's former accountants, Hood & Associates, and audit partner Rick Freeman zapped by the PCAOB: http://pcaobus.org/Enforcement/Decisions/Documents/11212013_Hood.pdf
RMCP's former accountants, Hood & Associates, and audit partner Rick Freeman zapped by the PCAOB: http://pcaobus.org/Enforcement/Decisions/Documents/11212013_Hood.pdf
FULO's former accountants, Hood & Associates, and audit partner Rick Freeman zapped by the PCAOB: http://pcaobus.org/Enforcement/Decisions/Documents/11212013_Hood.pdf
Drinks Americas (DKAM) Pours Into Chicagoland with 125-year old Distributor
I think it's great to see older folk still active in the workforce but I do hope they've given that poor old distributor a new walking frame and a nice string bag to hold all of the DKAM stuff, whatever it is.
An ad banner at IHUB for some pennyscam company:
XXX Pours Into Chicagoland with 125-year old Distributor
I hope they've given that poor old distributor a walking frame & a nice string bag to carry all the XXXX product.
Maybe there's a non-reliance 8-K for previous years to come?
They need to file an 8-K for *something* soon, otherwise I'll get bored. And that would be terrible.
“Valuations for many of these companies seem just as stretch as Internet stocks were back then ...”
It still makes me chuckle remembering meeting with the AsiaPac tech team for one of the big IB's back in 1999: they were amazed at their own creativity in coming up with valuation metrics for dot-com's based on DCF *multiples* (using a sub-10% discount rates, looking out 20 years...).
No amazement if people are doing the same kind of thing again.
Yes, except that he gets to avoid admitting guilt. I assume that getting a settlement with the SEC without a guilty finding was a major thing for him. Eg: his position looks grim enough in the AJW etc etc bankruptcy action & would probably have been disastrous if he'd been found guilty.
Corey Ribotsky, a prime beneficiary of VG's 2009-vintage pump & dump, consents to $14.5M judgement in his SEC case:
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=94123234
It's filed in the SEC case. Judgement is only for CR personally, not for the funds etc.
U.S. District Court
Eastern District of New York (Central Islip)
CIVIL DOCKET FOR CASE #: 2:11-cv-04723-JFB-GRB
Securities and Exchange Commission v. The NIR Group, LLC et al
Assigned to: Judge Joseph F. Bianco
Referred to: Magistrate Judge Gary R. Brown
Cause: 15:77 Securities Fraud
Date Filed: 09/28/2011
Jury Demand: Plaintiff
Nature of Suit: 850 Securities/Commodities
Jurisdiction: U.S. Government Plaintiff
Date Filed
#
Docket Text
11/13/2013 89 Letter dtd. 11/8/13 from Kenneth Byrne to Judge Bianco RE: proposed final judgment attached. (Attachments: # 1 proposed final judgment) (Bollbach, Jean) (Entered: 11/14/2013)
11/13/2013 90 JUDGMENT : See order for full details. (Bollbach, Jean) (Entered: 11/14/2013)
11/14/2013 ELECTRONIC PRETRIAL ORDER re 88 . The deadline to file the joint status report is ADJOURNED until December 16, 2013. Ordered by Magistrate Judge Gary R. Brown on 11/14/2013. (Lam, Joseph) (Entered: 11/14/2013)