Cotton & Western Mining Inc. (CWRN)

[brewhof]

Wish I hadn't checked in. This is not good news.

http://www.sec.gov/litigation/litreleases/2012/lr22389.htm

According to additional complaints also filed in the Southern District of Florida, defendants Robert L. Cotton, Harold Steven Bonenberger, Matthew A. Connor, Kevin P. Brennan, Donald G. Huggins, Marc S. Page, Cotton & Western Mining, Inc., Angel Acquisition Corp. n/k/a Biogeron, Inc., and Optimized Transportation Management, Inc. engaged in schemes involving an undisclosed bribe that was to be paid to a stock broker who agreed to purchase the microcap companies' stock in the open market for his customers' discretionary accounts. In the complaint against defendants Scott A. Haire and Wound Management Technologies, Inc., the SEC alleges that the defendants engaged in schemes involving both an undisclosed kickback and bribe.

The SEC alleges that the defendants in the schemes involving undisclosed kickbacks understood they needed to disguise the kickbacks as payments to phony consulting companies, which they knew would perform no actual work. They also knew the fund manager owed a fiduciary duty to the fund. In the schemes involving the undisclosed bribes, the SEC alleges that the defendants knew their illegal activities were meant to artificially inflate the companies' stock volume and prices.