CMKM Diamonds Inc. (fka CMKX)

[dia duit]

This is fantastic! Wilcox getting busted for penny stock kickback schemes is getting a lot of media attention. Hopefully there could be a wave of journalist writing about penny stocks scams while the story is hot.

pantherj, here's a story that you will appreciate. Because of your comments yesterday it made the story twice as funny to read!

Courtesy of http://investorshub.advfn.com/boards/read_msg.aspx?message_id=55343610

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=55331460
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=55336086

CHiPs Actor Suddenly Famous Again.

Friday, October 8, 2010

Here in the SD FL we've had our fair share of celebrity lawsuits -- Paris Hilton, Kanye -- but local SEC chief Eric Bustillo has set his sights on the white whale himself, former CHiPs star Larry Wilcox:
An actor who starred as a cop in the hit 1970's television show, "CHiPs" is one of several penny stock promoters the Securities and Exchange Commission has charged with securities fraud.

In complaints made public on Thursday, the SEC alleges that the actor, Larry Wilcox, and more than a dozen other penny stock promoters engaged in a series of kickback schemes to manipulate the volume and price of microcap stocks and illegally generate stock sales.

Wilcox, who starred as Officer Jon Baker on the long-running television show "CHiPs", lives in West Hills, Calif., and is president and chief executive of The UC Hub Group, according to an SEC complaint filed in U.S. District Court for the Southern District of Florida.

The SEC alleges that Wilcox perpetrated kickback schemes with two other penny stock company executives--Anthony Mellone, who was the chief executive of Tri-Star Holdings Inc and Alex Parsinia of Zcom Networks Inc.

According to the SEC's complaints, the series of schemes generally involved penny stock promoters paying kickbacks to pension fund managers or stockbrokers who would use their clients' accounts to purchase the publicly traded stock of microcap issuers promoted by the defendants. Microcap companies typically have limited assets and its stocks tend to be low priced and trade in low volumes.

The SEC also alleges that some promoters aimed to disguise the kickbacks as payments to phony consulting companies.

The alleged schemes were uncovered, however, when the penny stock promoters unknowingly arranged illegal transactions with Federal Bureau of Investigation agents or sources participating in undercover operations, according to an SEC complaint.

Of those charged, 10 of the individuals, including Wilcox, face separate criminal charges, which were filed by the U.S. Attorney for the Southern District of Florida. Those charges include conspiracy, securities fraud, mail fraud and wire fraud. Wilcox, 63 years old, is among those facing criminal charges.

"These penny stock promoters paid illicit kickbacks to people who they thought would help them profit at the expense of unsuspecting investors by manipulating the price of their stock or fraudulently selling their shares," said Eric I. Bustillo, director of the SEC's Miami office.
First of all, it's nice to see Larry gainfully employed.

No word on when Eric will bust Erik "Ponch" Estrada for that stupid land deal in Arkansas he is always promoting on late-night TV.

Either that or for always wearing a ridiculously tight uniform and feathered hair back in the 70s (we'd all be in jail if that were a crime!).

Wilcox is represented by William Richey and has apparently already entered a plea.
http://assets.bizjournals.com/cms_media/southflorida/pdf/Wilcox%20plea.pdf

Posted by South Florida Lawyers at 5:54 AM

http://southfloridalawyers.blogspot.com/2010/10/chips-actor-suddenly-famous-again.html



CHiPs' star busted for alleged penny stock scheme

By Darla Mercado
October 8, 2010


The Securities and Exchange Commission has slapped former “CHiPs” star Larry Wilcox with fraud charges for his role in an alleged penny stock kickback scheme.

In a sting operation that reads like something from of a '70s cop show, the Federal Bureau of Investigation snared a dozen potential lawbreakers involved in alleged schemes to boost the share prices of penny stock companies.

The SEC claims the former television star participated in interrelated kickback schemes with two other penny stock company executives: Alex Parsinia, CEO of Zcom Networks Inc., and Anthony Mellone, former CEO of Tri-Star Holdings Inc., a gold mining company. Mr. Wilcox is president and chief executive of UC Hub Group Inc., a mining and precious metals specialist founded in 1999.

Authorities claim the trio conspired to pay kickbacks to a pension fund fiduciary, encouraging it to misappropriate pension fund money to buy stock at inflated prices. (View a copy of the charges against Mr. Wilcox.) http://www.investmentnews.com/article/20101008/CHART/101009873

Specifically, the commission claims that, in May 2008, Mr. Mellone, then CEO of Tri-Star, searched for partners to help him inflate his company's stock price, which was trading at less than one cent per share. After his role was revealed by a cooperating witness, an FBI undercover agent acted as the point-person for a corrupt trustee of a fake pension fund called Benefits and Pension Group, according to the SEC's complaint.

Mr. Mellone allegedly paid $16,000 in kickbacks to the fund's trustee in return for its purchase of 90 million restricted shares of Tri-Star. To hide the illicit payment, he covered up the transaction as a payment to a phony consulting company, Great Lakes Advisors LLC, the SEC alleged.

The complaint claims that Mr. Mellone was “thrilled” that the deal had worked. He then reached out to Mr. Wilcox and Mr. Parsinia, the SEC claims, because he thought they “might be interested” in participating in the scheme.

Mr. Wilcox paid $16,000 to Great Lakes after the fake pension fund bought up 1.6 million shares of UC Hub's stock, the complaint states.

Mr. Parsinia paid $16,000 in kickbacks in exchange for the phony pension fund's purchase of 3.32 million shares of Zcom's stock, which traded below 18 cents a share, according to the SEC. Mr. Mellone allegedly pocketed a total of $4,000 for setting up these deals.

Besides the civil charges, the three men are also facing criminal charges filed by the U.S. Attorney's Office for the Southern District of Florida.

As of press time, InvestmentNews had not been able to find contact information for Mr. Mellone or his attorney. But Jerry Kaplan, Mr. Parsinia's attorney, said: “My client denies participating in any illegal kickback scheme.” He added that he hadn't seen the SEC's complaint until this morning.

The government sting covered several states and involved at least six separate alleged scams. The SEC stated that, in some instances, the promoters of the schemes “knew that the purported corrupt fund managers and brokers would be violating their fiduciary duties to their clients by taking part in the kickback schemes.”

A review of UC Hub's most recent financial statement reveals a company that appears to be sagging under the weight of its liabilities and losses.

For the first three months of 2010, UC Hub had no revenue. The precious metals specialist also had no sales in the same period the previous year.

Meanwhile, net losses have been mounting. UC HUB had some $152,677 in losses during the first quarter of 2010, nearly double the company's losses during the first three months of 2009. Liabilities far outweighed assets: Total assets were $229,166 for the first quarter, but total liabilities amounted to more than $4.5 million.

Calls to Mr. Wilcox and his attorney, William Richey, were not immediately returned.

The former television star is best known for his role as Officer Jonathan “Jon” Baker on the hit police show “CHiPs,” which ran from 1977 to 1982. Mr. Wilcox also appeared in guest roles in dozens of television shows up through the early '90s, including “Fantasy Island,” “The Love Boat,” and “MacGyver,” as well as a “CHiPs” reunion show in 1998. According to IMDB.com, Mr. Wilcox's last credited acting appearance was in the movie “The Thundering 8th,” which was released in 2000.

As of 3:00, UC Hub's share price had lost 61% of its value for the day, dropping to $0.0027.

http://www.investmentnews.com/article/20101008/FREE/101009875/-1/INDaily01