PGI Energy, Inc. (PGIE)

[Warhorse]

The Wakabayashi Fund

No junior mining company can survive without touts, and ParaFin has worked with many over the years. A few months ago, Mr. Fowlds hired an outfit calling itself the Wakabayshi Fund LLC. Wakabayashi purports to have offices in Tokyo, New York, and La Jolla, Calif. Its slick but annoying website offers little real information. Some digging, though, turns up a good deal of interesting information about the "fund" and its principals.

Those principals are one Jeffery Stone and his wife Janette Diller Stone, who also calls herself "Janette Dillerstone." Mr. Stone is a former Lehman Brothers stockbroker who spent a year in federal prison in the late 1990s as a consequence of his involvement in a penny stock scam. A few years after his release from prison, he met and married Ms. Dillerstone. The pair set up a business they called the Crescent Fund, and proceeded to become involved in yet another penny scam. The SEC sued, and the Stones skipped to Tokyo to avoid paying fines and disgorgement.

For ParaFin, the couple set up an elaborate on-line report extolling the virtues of the company, and even went so far as to run ads for ParaFin stock on Craigslist, a venue not normally used to flog questionable Pink Sheet issues. Mr. Fowlds paid them 40,000,000 shares of free trading stock, which they said they intended to sell. The company has 136,281,000 shares issued. The Stones received what some might consider an unreasonably large part of it.

2010-04-27 13:23 ET - Street Wire