SI
SI
discoversearch

 Technology Stocks | Preference Technologies


Previous 10 | Next 10 
To: afrayem onigwecher who started this subject2/1/2003 4:19:01 PM
From: StockDung
   of 460
 
IVSO: DJN: DJ IN THE MONEY: Investco CEO's Link To 'Mob On Wall Street'
(Dow Jones 05/06 13:55:47)
By Carol S. Remond
A Dow Jones Newswires ColumnNEW YORK (Dow Jones)- Joseph Lents has a problem.
U.S. securities regulators have halted trading in the shares of the latest
company he runs, a financial startup called Investco Inc. (INVSO).
That trading halt follows a report by this newswire that a key acquisition
the company says it made never happened.
But it's not the first time a company headed by Lents has caught the
attention of federal authorities. In the mid-1990s, Lents entered into a
deal with a man who was later identified as a figure in the infamous "Mob on
Wall Street" affair.
The Lents involvement in that case began in the summer of 1994 after an
aggressive short seller named Philip Gurian began putting pressure on the
shares of the company Lents ran at that time called International Standards
Group Inc.
Gurian recalls having his first talk with Lents while Gurian was vacationing
at the swanky Byblos Hotel in St. Tropez on the French Riviera.
During that telephone conversation, according to Gurian, the two agreed that
Gurian would stop short selling shares of International Standards Group. In
exchange for that promise, Lents would issue shares of International
Standards Group at a steep discount to firms in the Bahamas controlled by
Gurian and his associates under a U.S. securities provision called
Regulation S, which allows sales of unregistered stock to foreign investors.Gurian and four others were charged in 1999 in a 21-count federal indictment
including charges of mail fraud, wire fraud, securities fraud, interference
with commerce by extortion, conspiracy to commit money laundering and
witness tampering. Lents has never been charged with wrongdoing although the
stock transactions with firms controlled by Gurian and others were mentioned
in the federal indictment. Lents has not been available to answer questions.
A lawyer representing Lents has declined to comment on Lents' previous
involvement with Gurian.
Gurian pleaded guilty to one count of conspiracy to commit mail fraud, wire
fraud and securities fraud and one count of mail fraud. He is awaiting
sentencing.
According to the indictment by the U.S. District Court for the Middle
District of Florida, here's a typical way the scam worked:
Several small U.S. companies issued deeply discounted stock under Regulation
S to several mob-controlled firms in the Bahamas. These firms would turn
around and, through two Florida companies secretly controlled by Gurian -
Sovereign Equity Management Corp. and Falcon Trading Group Inc.- sell the
shares back to the U.S. public at market value, reaping a huge profit.
Published reports have indicated that Gurian controlled Sovereign Equity and
Falcon Trading on behalf of Philip Abramo, a man who federal investigators
identified as a captain in the DeCavalcante organized crime family from New
Jersey.
The 1999 indictment alleges that around November 1994, Lents filed false and
fraudulent subscription agreements for a Regulation S distribution of stock
to Caspian Consulting Ltd., one of the Bahamas corporations set up by Gurian
and others.
The indictment also states that between Jan. 1, 1995, and July 23, 1997,
Lents filed false and fraudulent Regulation S registration statements with
the Securities and Exchange Commission, selling International Standards
Group stock for 50 cents a share to Caspian Consulting, Maraval & Associates
Ltd. and Limelight Ltd., two other Bahamas corporations.
The SEC declines to comment on International Standards Group and its
issuance of Regulation S shares.
Lents later told the government that Gurian threatened his life if he told
the truth to federal agents, according to the indictment. Gurian told Dow
Jones Newswires he never threatened Lents.
SEC filings show that from September 1995 to December 1996, International
Standards Group and its successor company, Total World Telecommunications
Inc., sold $37.9 million worth of stock under Regulation S.
So much stock that by September 1996, Caspian Consulting and another
Bahamian firm called Reinerman Holdings Ltd., had become major shareholders
of International Standards Group, seemingly controlling 3% and 6% of the
company's stock, respectively.
International Standards Group's transactions with mob-controlled offshore
companies didn't stop at Regulation S stock issuance. A press release shows
that Lents' company entered into a joint venture with Maraval in September
1995 to market real estate and financial services via the Internet through
Florida Homes Info-Net, a wholly owned subsidiary of International Standards
Group.
The SEC amended Regulation S in early 1998, acknowledging in a release to
the public that it's "been used as a means of perpetrating fraudulent and
manipulative schemes, especially schemes involving the securities of thinly
capitalized or 'microcap companies'." Specifically, the SEC lengthened the
period during which offshore buyers of U.S. securities must hold shares
bought under Regulation S to one year from 40 days, making it much more
difficult to quickly profit by reselling those securities.
The 1999 Federal indictment that detailed Lents' Regulation S activity named
five defendants: Gurian, Abramo, Glen Vittor, Louis Consalvo and Barry
Gesser. Abramo and his bother-in-law Consalvo were separately indicted in
2000 in New York on charges including securities fraud and murder. Abramo
and Consalvo are trying to withdraw their Florida plea agreements.
Now, Lents is chief executive of Investco. Trading in Investco's shares has
been halted by the SEC until May 10. As reported by Dow Jones Newswires last
month, the reported acquisition of a Costa Rican insurance company by
Investco never took place, a fact the company failed to tell investors. The
company had touted the purchase in press releases as the cornerstone to its
plan to transform itself into a financial services provider.
Dow Jones Newswires also raised a number of questions about the number of
Investco shares outstanding and about Michael Zapetis, chairman of
Investco's controlling shareholder, First International Finance Corp.
Zapetis is a convicted drug smuggler who had a couple of run-ins with
Florida state banking regulators, none of which was disclosed to Investco
shareholders in any of the company's public SEC filings or press releases.
Lents has not been available for comment about Investco's activities. And
the SEC declined to comment further about the trading halt.
On Monday, the SEC halt of trading in Investco stock appears to have cost
the company its listing on the Over-The-Counter Bulletin Board. Nasdaq
delisted the company because there was no active quote for Investco shares
for four consecutive days.
By Carol S. Remond; Dow Jones Newswires; 201 938 2074;
carol.remond@dowjones.com.

Share Recommend | Keep | Reply | Mark as Last Read


To: Edward Williamson who wrote (387)2/1/2003 4:22:39 PM
From: StockDung
   of 460
 
WELCOME web.archive.org

Share Recommend | Keep | Reply | Mark as Last Read


To: afrayem onigwecher who started this subject2/1/2003 4:29:49 PM
From: StockDung
   of 460
 
Private Investigator Uncovers The Shady World Of Stock Scams, Tips And Spams

Gambling Magazine's Private Eye has been busy over the holiday period, looking into the shady world of stock hype and, specifically, Starnet's PR companies that set out to defraud investors. They were especially keen on "heightening investor awareness," that is making investors so hyped up with Starnet's "enhanced corporate credibility" that they would believe all the phony press releases sent out by the Italian "Big Pot" from the east coast.

STARNET PR COMPANIES IN HISTORY

"At MDC, our focus is on positive, bottom-line results," said CEO Michael Calderone.

STARNET COMMUNICATIONS INTERNATIONAL INC. HIRES U.S. BASED PUBLIC RELATIONS FIRM

Wilmington, DE, February 19, 1998 - Starnet Communications International Inc. (NASD OTC-BB: SNMM) ("Starnet") is pleased to announce that it has engaged Marketing Direct Concepts, Inc. ("MDC") to assist in Starnet's investor relations.

MDC (http://www.mdcinc.com) is a corporate business development and public relations company operating from the gaming community of Las Vegas, Nevada. MDC uses a comprehensive, international approach in reaching and motivating potential investors: media relations, publication in MDC's proprietary website and print newsletters, and a database of American stockbrokers, fund managers and stock analysts.

"At MDC, our focus is on positive, bottom-line results," said CEO Michael Calderone: "heightened investor awareness, enhanced corporate credibility, increased trading activity and favorable stock valuation."

Starnet (www.starnetcommunications.com) is an interactive entertainment company that identifies and commercializes Internet technologies for established markets.

Starnet's wholly owned subsidiary World Gaming Services Inc. (www.worldgaming.net) is a full-service gaming system (casino games, sports betting, lottery ticket sales, horseracing) licensed to accept real-money wagers via the Internet. World Gaming's sister subsidiary, Softec Systems Caribbean Inc. (www.softecsystems.com), licenses turn-key, customized Internet gaming systems (similar to World Gaming) to eligible third parties in exchange for participation in those licensees' net gambling revenues.

PC Computing magazine has estimated that the Internet gaming market could reach $20 billion US in annual revenues by the turn of the century.

Starnet's relationship with Global Media (Canada) Corp. has been terminated, and it is expected that a U.S. based public relations firm may more effectively target prospective Starnet investors.

For further information, please contact Starnet Investor Relations:
Toll-Free: (888) 777-6458
Telephone: (604) 685-7619
Facsimile: (604) 684-0391
E-Mail: ir@starnetcommunications.com

The statements in this press release may contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act of 1934 and is subject to the safe harbour created by these sections. Actual results may differ materially from the company's expectations.

==================================================

Michael Calderone -- Please trust a lying spammer to give you Stock Market tips

fortunecity.com

Michael Calderone (means a "big pot" in Italian) an east coast fellow trying to make it big in Vegas (just think Elvis played by Joe Pechi) and his little buddy Rys Fairbrother first started spamming via junk email that directed people to their webpages. As we know, spammed webpages don't last too long, although his spammed Verio/Dakota.net pages were up for quite a while.

Then with their combined intellect (not saying too much here!), they decided an even better way to spam was to send out phony press-releases to PR Wire, Business Wire, and Yahoo Biz. These releases contain 100's of popular stock symbols so anyone watching for news on their favorite company would get the junk pointing them to the Stockup.com pages. Lame.

Here we have the "Big Pot" himself, at home early one morning.

Michael Calderone
Marketing Direct Concepts
9428 Saltwater Crt / Salt Water Crt
Las Vegas, NV 89117

333 N. Rancho Dr. Suite 900
Las Vegas, NV 89106

The Association for Investor Awareness (INVESTORAWARE2-DOM)
303 S. Broadway Suite B #350
Denver, CO 80223

Stockup.com, Inc - Previously known as Courtleigh Capital Inc.

Stockup.com, Inc - A Publicly Traded Company OTC-BB: PFER (Was: OTC-BB: SKUP)

Click HERE to tell them, and others, what you think of their company.

Stockup.com also made it into Financialweb's Stock Detective stock hyper list.

Stockup.com is associated with convicted murderer and stock fraud scammer Eddie Williamson -- now isn't that a surprise!

Marketing Direct Concepts, Las Vegas
Kurt Divich, 888/632-4653
They represent Stinky Stock company, Saf T Lok, Inc. Can we say sleazy boys and girls?
StockUp! Financial Web, 888/63-2GOLD

Marketing Direct Concepts, Larry Isen, 702-648-6400
PR for a suspect MLM phone scam -- publicly traded stock!

NetRep Consulting, Inc. (emarketgroup)
10117 Jacob Place #203
Las Vegas, NV 89134

702-248-2448 (Home number)
702-243-8766 702-838-0268 702-838-0268 702-221-8811 702-593-6973 702-648-8560
702-648-6400 (FAX) 702-638-9096
888-342-3800

Rys Fairbrother
5931 NE Davis St
Portland, OR 97213-3817
2266 NW Dogwood
Madras, Oregon 97741
503-231-1639 / 541 962 7771

ryton@teleport.com
rys@stockup.com
helpdesk@stockup.com
help@stockup.com
stocktalk1@hotmail.com
kerry@stockup.com
rys@icount.com
billing@mdcinc.com
webmaster@investoraware.org
cpope@stockup.com -- Clinton Pope

mdcinc.com
stockup.com

Starnet Communications stock hyping

stock-up.com
stocksandmore.com
stocksnmore.com
stocksinplay.com
stocksnplay.com
showcasedstocks.com
stockwatch98.com
trewq.com.com
tgbnhy.com
emarketgroup.com
internetcount.com
stocksnfocus.com
stocksinfocus.com
stockobservers.com
stocksurge.com
hotnewshere.com
oshmansinfo.com
diamondsanddogs.com
researchsource.net
marketwatch98.com
viewonthemarket.com
marketinfosource.com
quotestream.com
sportsstream.com
sportsstream.net
sportsstream.org
realtimetickers.com
realtimetickers.net
realtimetickers.org
broadcastquotes.net
broadcastquotes.org
realtimeticker.com
realtimeticker.net
realtimeticker.org
myprivateportal.com
myprivateportal.net
myprivateportal.org
investoraware.org
ladystream.com
liveandfast.com
liveandfast.com
myportal.org
kidsstream.com
preferencetechnologies.com
preferencetechnologies.net
4healthstream.com
4healthstream.net
entertainmentstream.com

And we leave you with a couple of investment rules from their website: #7. One should never permit speculative ventures to run into investments. #27. Few people ever make money on tips. Beware of inside information. Follow the advice and stay far away from shady stock scams! Now that you've been warned, if you want to listen to the Big Pot 'educate and entertain' you, you can listen to his past ranting at this webpage. [AUDIO MISSING: 3/99]

Feb. 9, 2000 - StockUp.com, Inc. (OTCBB: SKUP), announced today that, effective February 23, 2000, the company will change its name to Preference Technologies, Inc., which will be traded under the symbol PFER. "Preference Technologies" more accurately describes the business and operations of the company," said Michael Calderone, CEO and president of StockUp.com, Inc. "The 'StockUp.com' name does not adequately convey the broad scope of our business and philosophical model." -- Huh... we thought it should have been 'Spamming Technologies.'

============================================

Kansas Ex-Convict Charged in Web Fraud of 1,000 Investors

Washington, Nov. 9 (Bloomberg) -- An ex-convict from Wichita, Kansas, and five companies were charged by regulators with allegedly defrauding 1,000 investors out of as much as $1.3 million in unregistered securities sold mostly over the Internet.

U.S. District Judge Wesley Brown froze the assets of 53-year-old Edward B. Williamson; Fifth Avenue Communications, supposedly Williamson's public relations firm; and Net World Marketing Inc., which says it operates an Internet shopping mall and was overseen by Williamson's wife, the Securities and Exchange Commission said.

The SEC also said assets also were frozen for Andros Hotel & Casino Inc., which claims to own two tracts of undeveloped land in the Caribbean; AutoAuction.com Inc., a Web site that purported to sell cars over the Internet; and AGE Investment Co., which is located in Williamson's Wichita office and was named a "relief defendant" in the case. The judge also appointed a receiver in the matter, the SEC said.

An attorney for Williamson was unavailable for comment. Williamson has a criminal record, including a 1967 murder conviction and a 1992 felony conviction for stealing money from his elderly mother, the SEC said. Williamson also was convicted of wire fraud in 1997 when he tried to bribe FBI agents posing as stock brokers, the SEC said. The National Association of Securities Dealers expelled him from the financial services industry in 1993, the SEC added.

Investors in Dark

Beginning in at least April 1997, Williamson used Fifth Avenue Communications and the other companies named in the case to fraudulently sell $1.3 million in securities to more than 1,000 investors nationwide, the SEC said.

Investors, who were kept in the dark about Williamson's role in the operations, were told that proceeds from the various offerings would be used for legitimate businesses, the SEC said. Roughly one-half of the $1.3 million raised in the Net World offering, alone, was siphoned off by Williamson and his connections, the SEC said.

After selling unregistered shares of common stock of Andros, Net World, and New Horizons, the defendants tried to manipulate the value of the securities by spreading false information over the Internet and in press releases, the SEC said.

Williamson also violated a cease-and-desist order issued by the SEC on June 13, the agency said.

The SEC urged investors, before buying any investment promoted over the Internet, to read "Cyberspace Alert," which is available on the SEC's Home Page under the Investor Assistance and Complaints link at www.sec.gov. The publication alerts investors to the telltale signs of online investment fraud, the SEC said. The SEC also urged investors to report suspicious Internet offerings via e-mail to enforcement@sec.gov.

Nov/09/2000 17:50 ET

For more stories from Bloomberg News, click here.

(C) Copyright 2000 Bloomberg L.P.

==================================

PREFERENCE TECHNOLOGIES INC filed this 10-Q on 11/20/2000

tenkwizard.com er=

On September 1, 2000 the Company secured a $150,000 loan from Jeffrey Jolcover, an employee of Preference Technologies, Inc. for working capital purposes. The Note carries no security arrangements, escrow arrangements, registration rights nor UCC agreements. The loan is due on September 11, 2000 and has an interest rate of 12% per annum, 75,000 common stock warrants, with a strike price of $1.10 and a five year expiration on the due date. Should the Note not be paid promptly, the Note holders at their option can convert the payment to shares of common stock at a conversion price of $.10 per share. The Note was extended to October 11, 2000 and is not yet paid.

Friday, March 20, 1998

Huge fraud brings plea, cooperation
An accountant involved in a wireless cable investment scam pleads guilty in Las Vegas.
By Carri Geer
Review-Journal

A certified public accountant pleaded guilty Thursday to conspiracy and money laundering charges for his role in defrauding investors nationwide of an estimated $35 million.

Federal prosecutors filed the charges against Jeffrey Jolcover under seal Thursday morning after reaching a plea agreement with him. The charges stem from the sale of interests in wireless cable ventures.

Jolcover's attorney, Joseph Cronin of Minden, briefly commented on the case after his client's court hearing.

"This has been a long process of approximately two years cooperating with the government, and we're both relieved that we've reached this stage and we're looking forward to the final resolution of this matter in June," the attorney said.

U.S. District Judge Howard McKibben is scheduled to sentence Jolcover on June 15.

Jolcover, a 43-year-old Las Vegas resident, pleaded guilty to one count of conspiracy to commit securities fraud, mail fraud and wire fraud; and one count of money laundering.

Although federal officials declined to make any formal statements regarding Jolcover's plea agreement, a source close to the case said the investigation is continuing and others may face charges.

According to Jolcover's written plea memorandum, also filed Thursday, "The defendant agrees to provide complete and truthful information and testimony concerning his knowledge of all other persons who are committing or have committed offenses against the United States, and agrees to cooperate fully with the government in the investigation and prosecution of such persons." Jolcover faces an estimated prison sentence of 57 to 71 months, according to the document. Prosecutors told McKibben they would recommend a term of five years or less if they decide Jolcover has given them "substantial assistance." The plea memorandum claims that, had the case gone to trial, prosecutors could have established that:

--Jolcover joined with a Las Vegas businessman and a Las Vegas attorney to offer investments in wireless cable ventures "in a manner calculated to deceive the investors."
--The sale of interests in those ventures raised about $35 million from investors throughout the United States.
--Between about January 1991 and mid-1995, Jolcover and others caused the creation of corporations to effectuate the sale of the investment interests, opened bank accounts to receive investor funds, and caused the creation and distribution of promotional literature "calculated to deceive investors."
--Jolcover and others, through the various corporations they controlled, caused the solicitation of investors through high-pressure telephone sales. They also conspired to misrepresent the true nature of the wireless cable investment opportunity being sold and the actual use of investor funds. "The operations of defendant Jolcover and other conspirators were centered in Las Vegas, Nevada," the plea memorandum states. "The promotional literature was printed in Las Vegas and was shipped from Las Vegas via Washington, D.C., to investors throughout the nation. A portion of the investors' funds were eventually wired to bank accounts in Las Vegas, Nevada, over which the conspirators exercised control."

According to the document, the money laundering charge stems from an October 1994 incident in which Jolcover caused $275,000 -- money illegally raised from investors -- to be deposited into a brokerage account in Reno.

"A substantial portion of these funds were then transferred to and deposited into an offshore bank account, said transaction being designed to conceal the ownership of the transferred funds," the document states.

Jolcover worked as an accountant for the state Gaming Control Board from 1977 to about 1979 and later operated his own accounting practice in Nevada. David Dantzler, an Atlanta attorney representing a court-appointed receiver involved in recovering investor funds, said he doubts any of the investors will recoup their losses.

Dantzler said the receiver, along with his attorneys and financial consultants, conducted an 18-month investigation as part of a Securities and Exchange Commission enforcement action against Jolcover and others involved in the sale and promotion of the investments.

"Within a matter of weeks, or certainly months, we concluded that these offerings were fundamentally fraudulent," he said.

Dantzler said the evidence gathered during that investigation formed the basis of the charges against Jolcover.





Back to the main page for more on Starnet's huge problems

article # starnet353


Editor: Editor@GamblingMagazine.com

Publisher: Publisher@GamblingMagazine.com
Telephone: U.S.A. (212) 208-4414


Copyright © 1999 Gambling Magazine

Share Recommend | Keep | Reply | Mark as Last Read


To: afrayem onigwecher who started this subject2/1/2003 4:35:59 PM
From: StockDung
   of 460
 
web.archive.org

Share Recommend | Keep | Reply | Mark as Last Read


To: jjs64 who wrote (418)2/1/2003 4:40:15 PM
From: StockDung
   of 460
 
web.archive.org

Share Recommend | Keep | Reply | Mark as Last Read


To: jjs64 who wrote (418)2/1/2003 5:04:53 PM
From: StockDung
   of 460
 
The Benefits of Conducting Business With Marketing Direct Concepts, Inc.

--------------------------------------------------------------------------------


As a full service promotional, marketing and financial agency, Marketing Direct Concepts (MDC) offers the young emerging growth company the optimum opportunity to achieve initial market prominence, while controlling costs and preserving vital cash flow.


Cost
MDC realizes the need for young companies to preserve vital cash flow to meet the diverse functional needs of their operations. Utilizing key up-to-date barter and trade based philosophies, all within strict SEC and FASB/IRS guidelines, MDC’s promotional and marketing programs will allow a company to communicate it’s purpose and corporate goals to millions of potential investors on a monthly basis. MDC can negotiate a stock and/or option position as compensation for it’s services, thereby drastically reducing a company’s need to rely on cash to promote themselves in a very competitive marketplace.



Experience
MDC’s Board of Experts brings together a synergistic team of individuals with varying backgrounds and international expertise. From brokers and principals of brokerage houses to investment bankers, multi media producers and trade specialists, MDC will work with emerging companies to enhance and incrementally improve their in-house promotional, marketing and financial activities.



Client Company Exposure
MDC’s carefully developed promotional program will be implemented to ensure that millions of potential investors every month will have access to a client company’s information. MDC owns and produces it’s own monthly advertising supplement that is included in all the major US based airlines’ In Flight magazines. This advertising supplement is also a part of many of the major business related national periodicals enjoyed by active investors on both a weekly and monthly basis. MDC owns and publishes the “BLECHMAN REPORT”, a national investment newsletter written by Bruce Blechman, author of the nationally acclaimed “Guerrilla Financing”. Planned for a national roll out on June 1, 1996, the “BLECHMAN REPORT” will identify, analyze and promote many of MDC’s client companies. MDC’s plan of promotion is two fold. MDC will expose their clients to key brokers, market makers and specific investors with the “BLECHMAN REPORT” and will introduce their clients to the general investing public by virtue of their monthly advertising supplements, planned radio programming and soon to be produced infomercials, in which investors will have the opportunity to visit with MDC’s client companies from the comfort of their home.



Investor/Client Follow-Up
All of MDC’s promotional programs and services are comprehensively assisted by major national 800 number services. All leads generated by the “BLECHMAN REPORT”, print ads, radio broadcasting and infomercials, will be immediately transferred from the 800 service to a licensed broker for follow-up. MDC is on the cutting edge of information technology and a network is in place to regularly transfer all investor information received as a result of the promotional programs directly to the MDC client company. MDC firmly believes in the process of networking and as a result, will be in close contact with their organization of brokers, market makers and investment bankers throughout North America.



Program Support
MDC, the “BLECHMAN REPORT” and all related programs and services will be found on the Internet, with an all inclusive Web Page. This will feature all of MDC’s offered services as well as the periodical listing of companies that have been spotlighted in the “BLECHMAN REPORT” and featured in the advertising supplements.


--------------------------------------------------------------------------------
By establishing a relationship with MDC, client companies will improve many aspects of their current business operations, but most importantly, MDC will create the framework to increase the present volume at which the company’s shares are being traded and subsequent positive market activity. By utilizing stock and/or options, a company will be able to meet and exceed most of their marketing goals with little or no cash outlay. By meeting certain criteria and depending on the company’s needs, a full service trade program can be developed and implemented where stock, options, products and services can all be utilized in procuring other goods and services the company needs to remain competitive in it’s own industry.


MDC’s programs are viable and essential to your company’s future growth. Your call today will be the first step in meeting your goals for tomorrow.
| Home | The Blechman Report | E-mail |

--------------------------------------------------------------------------------

Copyright © 1996 Marketing Direct Concepts, Inc.

Share Recommend | Keep | Reply | Mark as Last Read


To: afrayem onigwecher who started this subject2/1/2003 5:10:06 PM
From: StockDung
   of 460
 
Bruce Blechman and Pre-IPO Venture Capital Fund, LLC Scottsdale resident Bruce J. Blechman and his venture capital firm, Pre-IPO Venture Capital Fund, L.L.C., agreed to comply with a Cease and Desist Order in connection with his company's solicitation of over $2.5 million in investor funds from approximately 100 investors across the United States. Blechman's company, Pre-IPO Venture Capital Fund, originally sought to raise up to $5 million from investors to use as venture capital to finance a variety of small, start-up companies. Instead, the bulk of the investment funds were expended on solicitation costs, sales commissions and other related expenses. Blechman had initially represented that no more than 10 percent of the investor funds were to be used for such expenditures. Blechman and the Pre-IPO Venture Capital Fund agreed to pay $500,000 in restitution and an administrative penalty in the amount of $25,000.


COMMISSION NEWS ARIZONA CORPORATION COMMISSION, 1200 W. WASHINGTON, PHOENIX, AZ 85007 TO: EDITORS, NEWS DIRECTORS DATE: May 28, 2002 FOR: IMMEDIATE RELEASE CONTACT: Heather Murphy (602) 542-0844 COMMISSION ORDERS OVER $1 MILLION IN PENALTIES & RESTITUTION FOR SECURITIES VIOLATIONS PHOENIX ­ The Arizona Corporation Commission has issued orders to cease and desist from actions in violation of state securities laws against 21STCentury Satellite Communication, Glenn Liberatore and Howard Baldwin; Robert Witt; Bruce J.Blechman and Pre-IPO Venture Capital Fund, LLC.; David Hitzig; and Robert L. Fanzo doing business as Intermarc Marketing and CashFlows. 21STCentury Satellite Communication, Glenn Liberatore and Howard Baldwin The Commission took action against 21stCentury Satellite Communications, Inc., a Florida based company, and two of its sales agents, Glenn Liberatore of Utah, and Howard Baldwin of Scottsdale. The Commission found that 21stCentury, with the assistance of Liberatore and Baldwin, an Arizona-licensed insurance agent, fraudulently sold $262,000 of promissory notes to 14 Arizona residents. None of the Arizona investors have received their investment back. After selling over $23,000,000 of promissory notes nationwide, 21stCentury defaulted on the notes. Liberatore and Baldwin also illegally sold viatical settlement contracts-interests in the life insurance benefits of the terminally ill or elderly. 21stCentury was ordered to repay all investors $262,000 plus a $5,000 penalty. Baldwin was ordered to pay restitution of $47,164.13 and Liberatore was ordered to pay $28,460.84. Liberatore and Baldwin were each assessed an additional $5,000 penalty. Both orders allow for the $5,000 penalty to be reduced to $2,000 if restitution is paid in full. Following the Arizona Corporation Commission's action, the United States Securities and
--------------------------------------------------------------------------------
Page 2
Exchange Commission also brought an action against 21stCentury and its officers for fraud in the sale of securities. Unregistered insurance agents selling promissory notes, viatical investments and other securities have been a concern in Arizona for several years. Such activity was recently included in a list of the "Dirty Dozen" financial scams in Arizona by the Securities Division. Robert Witt The Arizona Corporation Commission ordered Robert Witt of Apache Junction, to cease and desist from fraudulent sales of unregistered viatical settlement contracts. Witt participated in sales of viaticals to investors from 1997 until 2001, as an employee of Scottsdale-based Carrington Estate Planning Services, owned by Richard Carrington. The Commission found that Witt failed to tell investors about the risks in investing in viaticals and about the poor track record of Carrington. Witt was ordered to pay $40,000 to investors and to pay a $5,000 fine. His penalty will be reduced to $2,000 once Witt makes the full $40,000 payment. Bruce Blechman and Pre-IPO Venture Capital Fund, LLC Scottsdale resident Bruce J. Blechman and his venture capital firm, Pre-IPO Venture Capital Fund, L.L.C., agreed to comply with a Cease and Desist Order in connection with his company's solicitation of over $2.5 million in investor funds from approximately 100 investors across the United States. Blechman's company, Pre-IPO Venture Capital Fund, originally sought to raise up to $5 million from investors to use as venture capital to finance a variety of small, start-up companies. Instead, the bulk of the investment funds were expended on solicitation costs, sales commissions and other related expenses. Blechman had initially represented that no more than 10 percent of the investor funds were to be used for such expenditures. Blechman and the Pre-IPO Venture Capital Fund agreed to pay $500,000 in restitution and an administrative penalty in the amount of $25,000. David Hitzig The Commission found that David Hitzig, 60, of Mesa, defrauded two Arizona investors when he sold them unregistered securities. Hitzig was not registered as a securities salesman. Hitzig helped persuade two investors to enter into investment contracts under which Early Detection Center, Inc. was to
--------------------------------------------------------------------------------
Page 3
form a corporation to open a cancer detection center in the valley. After taking the investment money, Hitzig failed to open a clinic with either of the investors. An Early Detection Center was open in Sun City for a short period of time, but neither investor received any financial benefit from the center. Hitzig was ordered to pay restitution of $75,000 plus interest and $5,000 in administrative penalties. Ronald L. Fanzo, Intermarc Marketing and CashFlows The Commission ordered Ronald Fanzo, 50, of Scottsdale, doing business as Intermarc Marketing, to cease and desist from violating the Securities Act through operations conducted via two Internet websites. The Intermarc website offered to investors high-risk computer "turnkey" systems purportedly designed to set up e-commerce businesses upon purchase. The other site, called CashFlows, offered investments secured by promissory notes signed by the computer system buyers. Fanzo promised a 30 percent rate of return on the investment over a six-month period. He told investors their money would be used to purchase the computer systems offered by Intermarc. He also falsely represented he had more than $179,000 in accounts receivable and claimed that no purchaser had ever defaulted on a system. In fact, Fanzo had not sold any computer systems and had no promissory notes to secure the investments. Fanzo used the investment capital largely for his own living expenses.The Corporation Commission ordered Fanzo to pay $12,750 in restitution and $15,000 in penalties. To check the registration of a securities offering or the disciplinary history of your financial professional, contact the Arizona Securities Division at 602-542-4242, toll free at 1-877-811-3878. The Arizona Corporation Commission's Securities Division website (www.ccsd.cc.state.az.us) also offers helpful information for investors. ###

Share Recommend | Keep | Reply | Mark as Last Read


To: afrayem onigwecher who started this subject2/1/2003 5:22:25 PM
From: StockDung
   of 460
 
Guerrilla Financing Pro Shares His Tactics By: Bruce J. Blechman


fprc.com.
CREATIVE FINANCING

Guerrilla Financing Pro Shares His Tactics

By: Bruce J. Blechman

ROYAL TREATMENT

How would you like to get money for your business without having a legal obligation to pay it back or give up any equity in your company? How would you like to add this money to your company's balance sheet as a direct increase in your net worth without increasing your liabilities? Even better, how would you like the people who gave you the money to wait around until you can afford to pay them back? Sound too good to be true? Well, it is true - it's called "royalty financing."

Most people are aware of the traditional types of financing-debt (loans) and equity (investments). If you borrow the money in the form of a loan, you are legally obligated to pay it back. You must make monthly payments of the principal and interest regardless of your business' situation. In other words, whether' business is good or bad you still must comply with the obligations of your loan. When you get the loan, the cash is added to the asset side of your balance and the loan becomes an increase in your liabilities. On the other hand, if you receive an investment, it means you have given up a percentage of your company for money. Selling a piece of your business wouldn't be so bad if you could get a proper evaluation of your company. But when it comes to smaller, privately held companies, the valuation given by investors is often low. Therefore, when a small business uses equity financing, it ends up giving away a large percentage of the ownership.

Royalty financing is completely different. It is off-balance-sheet financing because it appears on your financial statements only as a footnote -showing a contingent liability (a liability that may or may not happen). In this case, contingent upon the company making money. It's perfectly tailored to the needs of a young business and is an excellent way for entrepreneurial companies to attract investors.



HOW IT WORKS

Royalty financing involves giving an investor a percentage of sales or gross profits instead of monthly debt payments or equity ownership in the business. Here's how it works. Let's say you want to introduce a new product line, but lack the capital necessary for production and marketing. Instead of offering to pay back a loan to your investors or giving away a percentage of your business in return for capital, you offer your investors a percentage of the gross profits, or a royalty, from this new product line. The investors are not investing in your whole company, or even in your old product line, making it ideal for the introduction of the new line. The royalty income the investors receive is tied directly to the success of this product, and they will expect to get all their money back, plus a good return, from the sales of the new line.

Compare this with the standard method of obtaining a bank loan for a new product line. Assume that, as in all new product introductions, sales will go up and down before straightening out to a growth curve. If you take out a bank loan, monthly payments of principal and interest must be paid no matter what happens to the economy, your industry, your company, or sales of your new product line. If sales start dropping for any reason, the bank might decide to put you out of business if the loan is not paid on time.

Under royalty financing, however, your payments are directly related to what happens to the economy, your industry, your company, and, of course, the sales of your new product line. Because the royalty is usually a fixed percentage of sales, the royalty payments decrease - if sales decrease. If sales go up, royalty payments increase. In other words, royalty financing gives you much more flexibility than a typical bank loan. Also, with royalty financing, payments usually don't start until sales of the new product line are made. So, if you are delayed in introducing your new line you still have enough capital to get you through the tough times. What's more, under a royalty financing agreement, the revenue percentage, the term, and the exit clause are all negotiable. Try negotiating those terms with a bank!

Royalty financing is a win-win deal, offering just as many benefits to the financing source or investor as to the entrepreneur seeking capital. Here are the main advantages:

No specific payment schedule to meet every month, as with a loan.
Does not show up as debt on your balance sheet.
Does not dilute company ownership.
The investment goes directly into increasing the net worth of the company.
All payments to investors are tax-deductible.
Payments are not fixed, but tied to the revenue stream of the investment.
Investments can be tied directly to particular situations such as new product line introductions or other types of business expansion.
Does not require collateral or liens on any assets.
Improves your company's credit. Since the financing is off the balance sheet, you can borrow more money from conventional lenders.


Here are some advantages royalty financing offers the investor:



Investors get their money directly from the revenue stream before any other creditors are paid, and even before the company's owners are paid.
Investors do not have to pay double taxation on getting their money back in the form of dividends.
The return on investment can be far greater than a normal stock purchase in the same company.
Investors do not have to wait for the company to issue dividends, go public, sell out to another company, or experience tremendous sales growth before they get a return on their investment.
Royalty financing eliminates the problem of minority stockholders being dependent on the mere whim of the majority stockholders to get a return on their investment.
The investments is fixed to a percentage of sales and cannot be changed without mutual consent.




WHAT YOU SHOULD KNOW

Royalty financing's only major disadvantage is its cost. Investors usually want a higher return than you would pay a bank. That means royalty financing is not for every company. A well-established company in mature industry would probably do better with a bank loan. Rut, in today's economy, how many companies qualify as being well-established and mature?

If you think royalty financing is for you, here are some points to consider when setting up such a program. First, think through all aspects of the royalty program before you -sign on the dotted line. Make sure you can stop or reduce the payments once the investors have received an excellent return. Although royalty payments could theoretically go on forever, you should set an agreed-upon cap or point of diminishing return. - Insist on an exit clause that allows your company to extricate itself from paying royalties at some point. If your product line turns out to be a best-seller, you don't want the investors to take all the profits-merely a healthy return on their investment.

One way to do this is to arrange to buy out the investors' royalty payments at a predetermined price. Some companies even offer equity instead of cash to buy out royalty investors. For example, instead of paying the investors cash, you might affect your profitability. You don't want to be tied to a royalty financing deal that forces you to make payments based on outdated cost figures.

Third, don't attempt royalty financing unless you can raise your prices enough to give you some profit after the royalties are paid. - You don't want the royalty payments to eat up all your profits. As a rule of thumb, you should be able to raise the prices you charge for your products or services by at least as much as the royalty fee.

Royalty financing is just one technique in any aggressive investment banker's bag of tricks. If you are looking for a small amount of money-typically less than $100,00 you can probably negotiate a royalty financing arrangement with an investor on your own. However, if you go this route, have an attorney go over the agreement before you sign on the dotted line. If you are looking for more than $100,000 you should look for an investor through your investment banker, financing consultant or securities lawyer, or write to me in care of Entrepreneur for the names of firms that specialize in royalty financing.

Back to Articles

Share Recommend | Keep | Reply | Mark as Last Read | Read Replies (1)


To: afrayem onigwecher who started this subject2/1/2003 11:31:06 PM
From: rrufff
   of 460
 
edit wrong post - sorry tough to keep up with moronic posts by Un Truthseeker

Share Recommend | Keep | Reply | Mark as Last Read


To: StockDung who wrote (442)2/1/2003 11:33:12 PM
From: rrufff
   of 460
 
What is it with you? You have nothing better to do but to post over and over dated stuff that nobody reads? Are you that forked up to think that posting old stuff over and over again enhances your reputation?

It really is a shame. You've could do some good stuff and really go after some crooks. Instead you let your ego get in the way.

Result - when you are wrong, you will waste bandwidth posting over and over. You hope that, like a broken clock, you may eventually be right.

Un Truthseeker - doing the SooLoo dance

Share Recommend | Keep | Reply | Mark as Last Read
Previous 10 | Next 10 

Copyright © 1995-2014 Knight Sac Media. All rights reserved.Stock quotes are delayed at least 15 minutes - See Terms of Use.