Replies to post #111301 on RCC Holdings Corp fka RCCH

[Brad S]

I've gone over the language in the SEC complaint several times on this board. Anyone with a basic understanding of Engish knows exactly what it says.

[ThSeeker]

And how do you know that?

[Brad S]

Perhaps this will make it a little clearer for you.

1. Since early 2008, defendant Gendarme Capital Corporation (“Gendarme”), through its principals Ezat Rahimi and Ian Lamphere, has engaged in an illegal stock distribution scheme. The defendants have illegally sold to the public billions of shares of stock without registering the transactions or having a valid exemption to registration, as the federal securities
laws require. Gendarme acquired the stock from small public companies at 30-50% discounts to the market price in transactions where it falsely represented to the issuers that it purchased the shares for investment purposes only (not for the purpose of resale). Typically within days or weeks of acquiring the shares, Gendarme resold most of the stock in the public markets. Gendarme profited more than $1.6 million on its unregistered and illegal public distributions.

2. Gendarme typically bought shares from companies whose stock price was quoted by Pink OTC Markets, Inc. (“Pink Sheets”), a private electronic inter-dealer quotation and trading system used in the over-the-counter market. Companies quoted on the Pink Sheets are not required to file periodic financial and disclosure statements with the Commission. Thus, when distributions are unregistered, little or no disclosure about the company may exist. In acting as a conduit to dump shares of Pink Sheets companies on the public markets, Gendarme engaged in a lucrative end-run around an important disclosure policy underlying the securities laws.