Plastic2Oil Inc (PTOI)

[arvitar]

"Bordynuik and Baldwin are accused of not only pumping the books but of then doing a large private placement based upon those numbers. Then, once the private placement was complete, the company announced the overstatement and adjusted the assets back to the appropriate level. I don’t think this is something that can be effectively defended.

The risk here is not so much the money as Bordynuik has proven his ability to raise cash using JBI, Inc stock but rather the chance that he could be banned from acting as an officer or director for any company that basically is fully reporting. Given that Mr. Bordynuik is the driving force behind JBI, Inc, this raises considerable risk for the long term.

Looking at the growth of the company, there have been a lot of agreements announced but, in the first 9 months of the year, the company was only able to gross $221,653 through P2O while the primary revenue source Javco saw its revenues decline. At the same time, General and Administrative expenses saw close to a 50% increase to where now, JBI, Inc is losing around $1 million each month of which more than $550,000 is in cash. Given this reality, it would take the Hubble Space Telescope to see far enough into the future to locate possible profitability.

A final concern is that the company doesn’t seem to mind cheap selling its stock to raise additional capital. For example, in June 2011, the company was issuing a private placement at $.70 while the stock was trading in the mid $3's and as high as $4.15. Bottom line here is that, it’s a lot easier to raise more cash when a company doesn’t care about diluting its shareholders by selling highly discounted shares.

In the past 12 months, the company has increased the number of outstanding shares by 40% from around 50 million to over 70 million shares and the dilution continues. In light of the lackluster growth on P2O revenues and the decline of Javaco revenues, we find this trend troubling."

http://serious-speculator.com/2012/01/11/jbi-inc-stock-unusually-strong-despite-sec-action-alleging-securities-fraud/