Replies to post #2881 on China Dongsheng International Inc (CDSG)

[Mr. Zen]

The key issue with these guys is they do not follow the rules and young public companies are vulnerable because they need money to survive until they bring in an income. I believe the rule is they can sell no more than 2% of the monthly float into the market, that keeps the share price from tanking and protects shareholders..
The other side of that is the sales pitch they use on companies to buy these shares, it leaves the company vulnerable because they need the money and do not have the resources to investigate the source. Until the SEC changes it's regulations and allows ordinary investors to partake in the 144 market it will remain the same.... big boys get control to screw the average investors

the Defendants avoided certain regulatory obligations for dealers that govern their conduct in the marketplace, including regulatory oversight, financial reporting requirements, and maintaining required books and records.

uneducated investors in penny stocks always blame the company because the do not understand the dynamics of the professional investment market.

[i_like_bb_stock]

Yep

[DreamGreen]

If CDSG wants to go after the toxic noteholders this is the firm to contact. They were the ones that won against Adar Bay. Link to their blog about toxic lender litigation

https://www.thebasilelawfirm.com/post/toxic-debt-stock-repayments-to-lenders-may-be-the-next-time-bomb-under-bankruptcy-avoidance-laws

[i_like_bb_stock]

$CDSG EROP / Mannion / Mager noteholders on filings should beware here given the discussion of penalized unregistered note holders.

Adam R. Long; L2 Capital, LLC; Oasis Capital LLC
U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 25872 / September 28, 2023
Securities and Exchange Commission v. Adam R. Long, L2 Capital, LLC, and Oasis Capital, LLC, No. 1:23-cv-14260 (N.D. Ill. September 28, 2023)
SEC Charges Three Unregistered Dealers with Registration Violations
The Securities and Exchange Commission today filed charges against Adam R. Long of Dorado, Puerto Rico, and two companies Long owns and controls for acquiring and selling nearly 6 billion shares of microcap stock without registering as a securities dealer with the SEC.

The SEC’s complaint alleges that from at least November 2018 to August 2021, Long and his companies, L2 Capital LLC, and Oasis Capital LLC, regularly engaged in the business of purchasing convertible notes from microcap issuers, converting those notes into shares of stock at a large discount from the market price, and selling the newly issued shares into the market at a significant profit. The SEC alleges that Long and his companies obtained at least $20 million in profits after they sold nearly six billion newly-issued microcap stock shares into the market. The complaint also alleges that at the time of the conduct the Defendants were not registered with the SEC as dealers, in violation of the mandatory registration provisions of the federal securities laws. The SEC further alleges that by failing to register, the Defendants avoided certain regulatory obligations for dealers that govern their conduct in the marketplace, including regulatory oversight, financial reporting requirements, and maintaining required books and records.

The SEC’s complaint, filed in federal court in the U.S. District Court for the Northern District of Illinois, charges the defendants with violating the dealer registration provisions of Section 15(a)(1) of the Securities Exchange Act of 1934. The complaint alternatively charges Long with control person liability under Section 20(a) of the Exchange Act for L2 Capital’s and Oasis Capital’s violations. The SEC seeks permanent injunctions, disgorgement including prejudgment interest on a joint and several basis, civil penalties, and penny stock bars.

The SEC’s investigation was conducted by Jaclyn Janssen and Scott Hlavacek, and supervised by Amy S. Cotter in the Chicago Regional Office. Robert Moye and Gina LaMonica will handle the litigation.

SEC Complaint
https://www.sec.gov/litigation/litreleases/lr-25872