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Biotech / Medical : GMXX - GENEMAX CORP
ISON 0.00May 25 4:00 PM EDT

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From: StockDung6/25/2010 11:13:41 AM
   of 978
West Vancouver stock promoter works quietly, profitably and behind the scenes

By David Baines, Vancouver Sun June 25, 2010

First in a series

In the spring of 2006, a cabal of Vancouver promoters who are closely associated with notorious West Vancouver promoter Brent Pierce took over a shell company called Revelstoke Industries Inc.

Revelstoke was based in Vancouver, but it had registered its shares in the United States as a prelude to going public on the OTC Bulletin Board. Its purported business was construction site reclamation and preparation, but this was clearly a ruse. Its real utility was as a tightly held, publicly traded shell that could be used for some future promotion.

In April 2006, Marcus Johnson joined as president and CEO. He is an architect who lives and works in Bellingham, Wash., a popular bedroom community for the Howe Street pump-and-dump crowd.

Johnson is a longtime associate of Pierce, who ran into trouble with local securities regulators in 1993 and was banned from the B.C. market for 15 years. To circumvent his ban, Pierce works behind the scenes or out of the jurisdiction, often through his investor relations firm, International Market Trend AG, which is registered in Zurich but operates out of Blaine, Wash., another popular satellite office for Howe Street penny stock pushers.

In May 2006, Johnson was joined by three of Pierce's other cronies:

- Stephen Jewett, who became a director and head of the company's audit committee. He works as a chartered accountant on West Broadway, although he is somewhat restricted in his practice. In 1993, after he audited statements for a junior public company that turned out to be false, his professional association barred him from auditing the books of any public company. He became a director and -- ironically, considering his professional troubles -- head of the company's audit committee.

- D. Bruce Horton, who became a director and chief financial officer. He is a former certified general accountant and a co-founder of Clearly Canadian Beverage Corp. He and another longtime Vancouver promoter, Bryan Dear, run a private company on Alder Street, just a few blocks from Jewett's office, called Calneva Financial Group Ltd., which specializes in taking Chinese companies public on the bulletin board.

- Vaughn Barbon, who joined as controller. Although Barbon was a former bank administration manager, his hiring wouldn't necessarily instil confidence among shareholders. In 1991, he was convicted of embezzling $2.2 million from his then-employer, Montreal Trust, and sentenced to two years in prison. He is listed as a director and officer of Pierco Petroleum Corp., which operates from an office on the 12th floor of 666 Burrard Street.

They renamed the company Geneva Gold Corp. and announced a series of options on mineral properties in Saskatchewan, Panama, Peru and Nigeria. The stock soared to $3.50, but in a familiar pattern, the property deals were aborted, the stock plunged, and trading volume dried up.

Johnson, Horton, Jewett and Barbon -- along with another longtime Pierce cohort named Grant Atkins -- have played substantive roles in many other Pierce-inspired bulletin board pump-and-dump promotions, including Morgan Creek Energy Corp., Uranium Energy Corp., Lexington Resources Inc., and GeneMax Corp.

Denver lawyer Diane Dalmy has also helped all these companies with their SEC filings. Last fall, Dalmy earned the dubious distinction of being banned from the Pink Sheets, the most unregulated market in North America, after submitting legal opinions that were deemed to be substandard.

Pierce's name rarely shows up in any of the companies' filings, but there is no question that he is working in the wings. An example is Lexington Resources, which featured Horton, Jewett, Barbon, Atkins and Dalmy.

Lexington's investor relations affairs was openly handled by Pierce's firm, International Market Trend, but it soon became clear he played a much larger and more insidious role. In 2008, the SEC filed a complaint alleging that Atkins, who was serving as the company's president, had issued more than five million Lexington shares to Pierce and several associates, who then commenced a massive spam and newsletter campaign.

The stock jackknifed to $7.50 US, allowing Pierce and his buddies to dump millions of dollars worth of stock, which had not been registered for resale.

Much of the stock was sold through Hypo Bank, a Liechtenstein bank that was banned from the B.C. market in 2008 for refusing to reveal the beneficial owners of accounts that it ran at a half dozen local brokerage firms.

Lexington's share price later slumped to two cents and the company went bankrupt.

In June 2009, a Seattle judge found that, although Pierce was neither an officer nor director of Lexington, he was the controlling force: "The totality of the circumstances -- Pierce's sway over Lexington's CEO, Atkins, his substantial ownership of Lexington stock, his control over the consultants assigned to work for Lexington [identified as Johnson, Barbon and others] -- all point to Pierce's control of Lexington," the judge said.

The judge ordered Pierce to disgorge just over $2 million of his ill-gotten gains. A few weeks ago, the SEC filed another enforcement action seeking to recover an additional $8 million in profits from the sale of 1.6 million shares in the accounts of two offshore companies that he controlled, Newport Capital Corp. and Jenirob Company Ltd. During that proceeding, Pierce's lawyer revealed that his client is under criminal investigation for another bulletin board pump-and-dump called CellCyte Genetics Corp.

There is no question that Pierce, who is now 53, has made a ton of money from these go-nowhere deals. In November 2006, his wife, Dana, bought a Vancouver condo for $6.2 million. And in August 2007, the couple acquired a waterfront home in West Vancouver for $10.4 million. A few weeks ago, they signed an interim agreement to buy Saturna Island Winery for a reported $12.9 million, but backed out after conducting their due diligence.

I have been trying to catch up to him for years.

On Thursday, I called Pierco Petroleum, where Barbon and Robert Harris, who figured in the CellCyte scandal, are listed as the sole directors. I figured that with a name like Pierco, the great man himself couldn't be too far away.

Sure enough, Pierce answered the phone, but he wasn't in a chatty mood. "Nobody is going to talk to you, David. Have a nice day," he said, hanging up.


NEXT: We track the rise and fall of Geneva Gold which, like Lexington, turns out to be all smoke and mirrors.

© Copyright (c) The Vancouver Sun

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