D Mecatronics Inc. (fka DMTA)

[Rev Kilgore Mullet]

Another former DMTA sleazebag attorney:


http://www.stockwatch.com/newsit/newsit_newsit.aspx?bid=Z-C:*SEC-1713088&symbol=*SEC&news_region=C

During the past decade, Colorado lawyer Diane Dalmy has helped many disreputable Vancouver stock promoters take their dubious stock deals public on the U.S. over-the-counter markets.

As business propositions, most of these deals are laughable. Some are obvious shams. In many cases, the real purpose is to create a tightly held shell company that can be easily manipulated, making it perfect for some future pump-and-dump stock scheme.

Dalmy, 55, is a graduate of the University of Denver law school. She works from her residence in Lakewood, a suburb of Denver.

The quality of Dalmy's legal work is so low that last September, the Pink Sheets -- the most laissez faire trading forum in the United States -- refused to accept any more lawyer letters or legal opinions that she prepared on behalf of issuing companies.

"In general, we expect attorneys who provide us with letters to know securities laws, do the work required, and be ethical," Pink Sheets chairman Cromwell Couslon earlier told me.

"We ban them when it becomes apparent they are stupid, lazy or dishonest."

This is truly a dubious distinction. To date, Pink Sheets has relegated 18 lawyers to its Hall of Shame.

Of these, 13 have been cited by the U.S. Securities and Exchange for securities breaches.

Among them are Vancouver lawyer John Briner, Miami Lawyer Joseph Emas, and Seattle lawyer David Otto, all of whom have been extremely active in the Vancouver marketplace.

So far, though, the SEC has not cited Dalmy for any wrongdoing. But some of her clients haven't been so fortunate.

Her most notorious clients have been companies backed by West Vancouver promoter Brent Pierce.

Pierce has a scandalous securities record. In 1993, the B.C. Securities Commission banned him for 15 years after he admitted to diverting proceeds of the initial public offering of a Vancouver Stock Exchange company.

Undeterred, he began promoting stocks that traded on the OTC Bulletin Board in the United States. Among them were Lexington Resources, Geneva Gold, Morgan Creek Energy, Uranium Energy and GeneMax.

All were ruthlessly promoted and their share prices rose and fell in stunning fashion, resulting in horrendous losses for investors who were naive enough to believe the storylines. None of this seemed to bother Dalmy, who provided crucial legal services for all of them.

Perhaps the best example is Lexington Resources. Fuelled by a massive spam and newsletter campaign, the stock swelled to $7.50, allowing Pierce and his buddies to dump millions of dollars worth of stock. The stock subsequently plunged to two cents and the company is now in bankruptcy.

In 2008, the SEC alleged that Pierce's shares had not been properly registered.

A Seattle judge subsequently found Pierce's conduct had been "egregious and recurrent" and ordered him to disgorge more than $2 million in ill-gotten gains.

In April 2009, Dalmy acted as counsel for a made-in-Vancouver shell company called Kinder Travel Inc. when it morphed into a biomedical company called Genova Biotherapeutics Inc.

Genova's share price spiked from a few cents to $1.18 in September. Then the SEC issued a temporary trading halt.

The SEC said it was concerned about the company's promotional activities and the "accuracy and adequacy" of its public disclosure. In January, the B.C. Securities Commission issued a cease-trade order which is still in effect. Meanwhile, the share price has slumped to two cents.

Among the firms that were touting Genova was a U.S. investor relations service called Windfall Communications, which has represented many scurrilous companies, including Pierce's old companies, Geneva Resources and Morgan Creek Energy.

On its website, Windfall reported that on Sept. 10 -- just before the SEC imposed its trading halt against Genova -- Dalmy had paid Windfall $6,000 "to answer incoming calls and investor inquiries" about Genova for a three-month period. Why Dalmy became involved in Genova's IR campaign is not clear.

A few months earlier, in June 2009, the SEC issued a similar trading halt against Patriot Energy Corp., a Montreal-based company that Dalmy had helped go public on the Pink Sheets.

Patriot had claimed it had received a takeover offer from a subsidiary of Turkish car parts supplier Marmara Motorlu Araclar. After Marmara denied the report, both the SEC and the BCSC halted trading. The stock is now worthless.

As noted, Dalmy has been banned from the Pink Sheets, but she is still helping companies go public on the bulletin board. In October, for example, she filed an opinion letter for Pro Nutrisource Inc., a Montreal-based company that plans to sell nutritional supplements.

This doesn't look like an earnest business endeavour. The company had no revenues and only $13,683 in the bank. In any event, the registration process seems to be stalled. We can only hope that the SEC is taking a hard, second look at it.

Posted by Tony Bisante @ 2010-04-28 18:07