Laidlaw Energy Group, Inc.(fka LLEG)

[rich sears]

Chad Bray, The Wall Street Journal, February 1, 2010

NEW YORK (Dow Jones)--The U.S. Securities & Exchange Commission sued a New York lawyer on Monday for allegedly writing bogus opinion letters to help stock promoters improperly procure unrestricted stock certificates in three unregistered "penny" stock offerings.

The lawsuit, filed in U.S. District Court in Manhattan on Monday, alleges that Stephen Czarnik, a partner at Cohen and Czarnik LLP, assisted three stock promoters in the abuse of a rule that allows accredited investors to acquire unrestricted shares from transfer agents in unregistered securities offerings that don't exceed $1 million.

The SEC said Czarnik continues to serve as a "one-man 'opinion-mill' for unregistered penny stock offerings." The regulator said Czarnik has authored at least 111 opinion letters for unregistered stock offerings, involving the transfer of more than 2.5 billion shares to penny stock promoters by 43 issuers.

"Czarnik served an essential role in these illegal offerings," the regulator said. "He churned out bogus opinion letters predicated on the promoters' alleged representations to him that they are buy-and-hold investors. In fact, Czarnik knew that they had no intention of holding the stock, but that they intended to nationally advertise the stock and quickly dump their shares into the public market for millions of dollars."

The alleged improper activity involved unregistered offerings for three penny stock companies between June 2007 and January 2008, in which the promoters served as intermediaries.

Czarnik didn't immediately return a phone call seeking comment Monday.

Before agreeing to issue unrestricted shares in absence of a registration, many transfer agents require a lawyer's opinion from the issuer's counsel explaining why it would be legal to do so, the SEC said.

The SEC said the promoters improperly pretended to be accredited investors intent on buying and holding stock of small companies for investment purpose, but their true goal was to take the companies public and immediately distribute stock in the public market.

"Czarnik knew or was severely reckless in not knowing that the promoters intended to distribute the stock to the public and that the transfer agent would rely on his letters and issue stock certificates without restrictive legends," the SEC said.

And a couple links to help you digest that info.

http://www.sec.gov/litigation/complaints/2010/comp21401.pdf

http://www.laidlawenergy.com/investors.html