Penny Stock Fraud

[riverbabe]

NO NO! SAY IT ISN'T SO! http://www.nytimes.com/2014/09/12/ny...&nlid=47075250

$290 Million Lost in Penny Stock Fraud, Prosecutors SayOn Thursday, eight people were indicted on charges they defrauded thousands of investors of more than $290 million from April 2009 to May 2012, using emailed newsletters to hype nearly worthless companies, The New York Times reports.

$290 Million Lost in Penny Stock Fraud, Prosecutors Say

By JAMES C. McKINLEY Jr.SEPT. 11, 2014

Investors would hear about the companies through newsletters emailed from websites that tout penny stocks, with names like PennyPic.com,OxofWallStreet.com and MonsterStox.com, their missives full of hyperbolic language and exclamation points.
What the investors did not know, prosecutors say, is that the men writing the newsletters owned stock in the companies they were promoting, and also had colluded with officials in those companies to drive up prices with misleading news releases.
When prices rose, the promoters and company officials would sell off millions of shares they controlled, leaving investors with worthless stock. It was an Internet-driven variation on the pump-and-dump stock manipulation schemes that unscrupulous stockbrokers have practiced for decades, prosecutors said.
On Thursday, eight people were indicted on charges they defrauded thousands of investors of more than $290 million from April 2009 to May 2012, using emailed newsletters to hype nearly worthless companies.
Three stock promoters — Anthony Thompson, 38, of Bethesda, Md.; Eric Van Nguyen, 30, of Quebec; and Jay Fung, 40, of Delray Beach, Fla. — were accused of conspiring with officials in control of five public companies to drive up prices of penny stocks.
Mr. Thompson and Mr. Fung were arraigned on charges of grand larceny, scheme to defraud and securities fraud in State Supreme Court in Manhattan and released on $1 million bail each; Mr. Nguyen was still at large.
“They took advantage of their position as promoters to profit for themselves on the backs of public investors,” an assistant prosecutor, Brian Kudon, said at Mr. Thompson’s arraignment.
But Mr. Thompson’s lawyer, Maranda Fritz, said that her client’s newsletter, from FreeInvestmentReport.com, was a paid advertisement for the companies he wrote about, which she said was clearly stated in its disclosures to investors.
“It’s advertising,” Ms. Fritz told Justice Roger S. Hayes. “You might as well indict ‘Mad Men,’ if they actually existed.”
Mr. Fung’s lawyer, Michael Bachner, also said his client had disclosed to readers that he had a financial interest in the companies he promoted.
Prosecutors, however, described in an 85-count indictment an intricate conspiracy to defraud investors. Mr. Kudon said the conspirators bought public shell companies and merged them with newly created private companies. Then they issued or transferred millions of free-trading shares in the shell companies to themselves, family members, friends and associates. Next, they coordinated with the three promoters to issue rosy, misleading news releases about the companies, driving up the stock prices before dumping their shares on the open market, court papers said.
The eight defendants made more than $30 million on sales of the stocks, prosecutors said. The companies involved included Smart Holdings Inc., Lyric Jeans Inc., Hydrogenetics Inc., Xynergy Holdings Inc., Blast Applications Inc., Blue Gem Enterprise Inc., Mass Hysteria Entertainment Company Inc., Recycle Tech Inc. and Sunpeaks Ventures.

[Phoenix7]

NO NO! SAY IT ISN'T SO! http://www.nytimes.com/2014/09/12/ny...&nlid=47075250

$290 Million Lost in Penny Stock Fraud, Prosecutors SayOn Thursday, eight people were indicted on charges they defrauded thousands of investors of more than $290 million from April 2009 to May 2012, using emailed newsletters to hype nearly worthless companies, The New York Times reports.

$290 Million Lost in Penny Stock Fraud, Prosecutors Say

By JAMES C. McKINLEY Jr.SEPT. 11, 2014

Investors would hear about the companies through newsletters emailed from websites that tout penny stocks, with names like PennyPic.com,OxofWallStreet.com and MonsterStox.com, their missives full of hyperbolic language and exclamation points.
What the investors did not know, prosecutors say, is that the men writing the newsletters owned stock in the companies they were promoting, and also had colluded with officials in those companies to drive up prices with misleading news releases.
When prices rose, the promoters and company officials would sell off millions of shares they controlled, leaving investors with worthless stock. It was an Internet-driven variation on the pump-and-dump stock manipulation schemes that unscrupulous stockbrokers have practiced for decades, prosecutors said.
On Thursday, eight people were indicted on charges they defrauded thousands of investors of more than $290 million from April 2009 to May 2012, using emailed newsletters to hype nearly worthless companies.
Three stock promoters — Anthony Thompson, 38, of Bethesda, Md.; Eric Van Nguyen, 30, of Quebec; and Jay Fung, 40, of Delray Beach, Fla. — were accused of conspiring with officials in control of five public companies to drive up prices of penny stocks.
Mr. Thompson and Mr. Fung were arraigned on charges of grand larceny, scheme to defraud and securities fraud in State Supreme Court in Manhattan and released on $1 million bail each; Mr. Nguyen was still at large.
“They took advantage of their position as promoters to profit for themselves on the backs of public investors,” an assistant prosecutor, Brian Kudon, said at Mr. Thompson’s arraignment.
But Mr. Thompson’s lawyer, Maranda Fritz, said that her client’s newsletter, from FreeInvestmentReport.com, was a paid advertisement for the companies he wrote about, which she said was clearly stated in its disclosures to investors.
“It’s advertising,” Ms. Fritz told Justice Roger S. Hayes. “You might as well indict ‘Mad Men,’ if they actually existed.”
Mr. Fung’s lawyer, Michael Bachner, also said his client had disclosed to readers that he had a financial interest in the companies he promoted.
Prosecutors, however, described in an 85-count indictment an intricate conspiracy to defraud investors. Mr. Kudon said the conspirators bought public shell companies and merged them with newly created private companies. Then they issued or transferred millions of free-trading shares in the shell companies to themselves, family members, friends and associates. Next, they coordinated with the three promoters to issue rosy, misleading news releases about the companies, driving up the stock prices before dumping their shares on the open market, court papers said.
The eight defendants made more than $30 million on sales of the stocks, prosecutors said. The companies involved included Smart Holdings Inc., Lyric Jeans Inc., Hydrogenetics Inc., Xynergy Holdings Inc., Blast Applications Inc., Blue Gem Enterprise Inc., Mass Hysteria Entertainment Company Inc., Recycle Tech Inc. and Sunpeaks Ventures.

River babe
My family and myself have always led honest lives. Trying to cheat someone always backfires. Sooner or later the cheater will suffer in the end. Too bad there are so many scoundrels out there. Listening to the show CNBC "GREED" is really an educational experience , and you can learn how many scams work,
Bernie Madoff scammed many , but in the end he is in prison, one son committed suicide, and one recently died of cancer which he claims was the result of stress brought on by his father's crimes. Stress can be linked to many illnesses. Lead an honest life, you will sleep better and also eliminate major stress which can cause illnesses.

[riverbabe]

P7, I do watch GREED. Day before I watched the fine arts TV show fraud. I occasionally watched those shows for fun. They were auctioning signed and numbered lithographs by Picasso, Chagall, and the like. Guess who was making Xerox copies of prints in art books and using their own pencils to do the signing? Or buying forgeries from suppliers and passing them off as the real thing. They are now off DirecTV, Dish, etc. and languishing in prison. There was a passing mention of the art auctions on cruise ships like Carnival. I myself have purchased some of those. Without trying to authenticate them, I'll just be happy with prettying up my walls and the cost of the auction entertainment.

[Phoenix7]

P7, I do watch GREED. Day before I watched the fine arts TV show fraud. I occasionally watched those shows for fun. They were auctioning signed and numbered lithographs by Picasso, Chagall, and the like. Guess who was making Xerox copies of prints in art books and using their own pencils to do the signing? Or buying forgeries from suppliers and passing them off as the real thing. They are now off DirecTV, Dish, etc. and languishing in prison. There was a passing mention of the art auctions on cruise ships like Carnival. I myself have purchased some of those. Without trying to authenticate them, I'll just be happy with prettying up my walls and the cost of the auction entertainment.

Yes I went on cruises ,and had seen those art auctions ,and they looked shady to me. Basically the cruise ships are out to extract every last dollar out of you. The shore trips arranged by the cruise directors were expensive, and I much preferred to go off on my own! I wonder how the more luxury cruises like the Crystal cruises treat you?