DNA Brands Inc (DNAX)

[Ed the Trader]

"Provide the evidence please to support such a claim that RedChip was hired to sell stock. The idea of this even on the face of it is complete nonsense."

People are probably suggesting that DNA hired RedChip to sell stock (by promoting DNAX and bringing additional investors to look at DNAX) because stock promoting is what RedChip does.

I've got more than three years of RedChip's promotional e-mail messages in my inbox. They pimp stocks and they obviously get paid for their efforts.

Considering that DNA is short on cash, it makes perfect sense that RedChip might be paid with stock. I am not saying that is how they were paid. However, it really doesn't matter. Either RedChip accepted shares of DNAX as payment OR DNA got cash to pay RedChip from selling shares of DNAX to someone else.

The end result is the same: dilution.

RedChip is a stock promoter, not a true investor relations company as Adrian has presented them.

True investor relations firms... like the kind that large, profitable corporations use... do not actively try to attract investors. The company's performance attracts investors. Instead, the purpose of true investor relations firms is to create a firewall between corporate insiders and investors.

Investor relations firms of provide investors with information that has already been publicly released. Because investors talk to these third party companies, instead of corporate insiders, no one can suggest there is any improper insider trading activity occurring.

People on iHub who trade OTC Pinks think it is normal to call a CEO to attempt to get the CEO to answer their questions.

What they do not realize is that not only is it NOT normal, if someone simply asks a corporate insider for any information not already released publicly, they are asking that corporate insider to commit a felony by engaging in insider trading. Further, simply asking someone else to engage in insider trading is ALSO a felony!

That is why if you managed to call a corporate insider at a publicly traded business that was a legitimate and successful business, they would not answer any questions but would simply give you the phone number for their investor relations firm.

Anyway... RedChip gets hired by businesses to attract additional investors to the business. I have roughly 3 years of their e-mail which promotes a variety of businesses by getting the word to everyone on their mailing list. The e-mail messages tell the people on the mailing list how wonderful the promoted company is.

I do not know if this fits for RedChip, but most stock promoters also pump the stock after the promoter has purchased a pile of the company's stock so they can also take advantage of their own promotion.

There is nothing wrong with that. It is usually completely legal.