Replies to post #2113 on NMC Inc. (fka NMCX)

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And a 2003 article, after the delisting, by Brent Mudry of Canada Stockwatch:
Msg. 38135 of 39047
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by Brent Mudry

The United States Securities and Exchange Commission has broadened its prosecution of Hexagon Consolidated Companies of America Inc., a penny stock promotion featuring Maurice Furlong, a Reno promoter with a 27-year regulatory history, Michael Pietrzak, a Chicago lawyer with a criminal conviction, and Donald E. Jordan, a 79-year-old registered assayer who posted bogus values of $2-billion to $4-billion on the company's mineral properties. The SEC, Canada and the U.S.'s best known regulator, announced Tuesday that it has banned two accountants who helped cook the books of the tiny company.

In consent settlements, certified public accountants Barbara L. Berry, 42, of Scottsdale, Ariz., who served as Hexagon's chief financial officer, treasurer and a director in 1997, and W. Dale McGhie, 64, of Reno, who served as Hexagon's auditor from 1996 to late 2001, have been stripped of their privileges of appearing or practising before the commission as accountants. Both have also been ordered to do their best to refrain from future securities violations.

The SEC's actions against the Hexagon accountants come after the regulator filed a broad civil complaint targeting Mr. Furlong, Mr. Pietrzak and Mr. Jordan. The SEC claims Mr. Furlong dumped more than 79.7 million shares of Hexagon, fraudulently receiving at least $4.2-million in proceeds, amid a lengthy span of bogus filings from 1996 through 2001.

Although not noted in the SEC complaint, Mr. Furlong used an account at Vancouver brokerage Pacific International Securities. The controversial Howe Street brokerage notes that Mr. Furlong, whose regulatory record dates back to 1977, voluntarily closed his accounts in late 1999 after selling a modest number of Hexagon shares.

In the latest actions, the SEC claims Ms. Berry engaged in dubious accounting, posting a $69.37-million value on California mining claims vended in to Hexagon in early 1997, with no reasonable evidence any economically recoverable reserves existed, a $50-million value on dubious television advertising credits vended in to Hexagon in mid-1996, a $200-million value on a dubious ore inventory acquired in 1995, and a $49-million value on real estate purportedly acquired between 1997 and late 1999, which never materialized.

The regulator made similar book-cooking allegations against Mr. McGhie, Hexagon's auditor from 1996 to late 2001. Mr. McGhie apparently jumped the gun before his SEC ban became official last Friday. Another penny stock client, Intermountain Resources Inc., disclosed in early December that Mr. McGhie informed the company on Nov. 26 that he has ceased doing any SEC work.

Among Mr. McGhie's other recent clients is SulphCo Inc., a Reno-based company under investigation by the SEC. Sulphco notes it received a "Wells" warning letter on March 4, 2002, from the Salt Lake City office of the SEC, advising that civil charges were anticipated against the company and its president Rudolph Gunnerman. (No such action has yet been filed.)

Sulphco had the misfortune of being targeted in a detailed and unflattering June 26, 2001, sell report by influential and controversial California shortseller Amr Ibrahim (Anthony) Elgindy, who is currently fighting criminal allegations he received confidential dirt files from corrupt FBI agents.

Besides Sulphco, Mr. McGhie served as the independent accountant for several other penny stock promotions which featured as a director Alexander H. Walker, 76, whose background includes serving as attorney in charge of the SEC's Salt Lake City branch from 1955 to 1956.

Meanwhile, Mr. Jordan, Hexagon's 79-year-old registered assayer, has made a name for himself with mining industry authorities, including the Bureau of Land Management, an agency of the U.S. Department of the Interior.

On Jan. 22, the BLM released a 2002 survey of selected assay laboratories in North America. Labs were given various blank samples, with negligible values of gold and other precious metals, and conducted assay tests.

Mr. Jordan's Metallurgical Research and Assay Laboratory, in Phoenix, Ariz., stood out with distinction. On the first sample, which had a standard reference value of 0.228 ounce of gold per ton, Mr. Jordan's lab assayed more than two ounces. On the second sample, with a standard reference value of 0.012 ounce, his lab posted 0.68 ounce. On the third sample, with a standard reference value of 0.023 ounce, Mr. Jordan's lab posted a remarkable 1.56 ounces.

(Readers wishing further details of the SEC's Hexagon prosecution may refer to two Street Wires dated March 10, under the U.S. symbol *SEC or the Canadian symbol *BCSC.)

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