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   PastimesNEIP - A lesson in how to lose a fortune with market order

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To: Wayne Rumball who wrote (10)11/15/1999 11:22:00 PM
From: Vision21
   of 20
I may lose out on some good plays because I will not use a market order to buy. However, I know that the M M are not going to rip me off. I guess it is like safe sex!!!

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To: Wayne Rumball who wrote (10)11/16/1999 12:19:00 AM
From: Jim Bishop
   of 20
How'd it start? Appears to have been a rumour of takeover by LGC Wireless started on Yahoo, taken up on RB, then Bobz and SI.

Just dicking around with NEIP, may as well post it, in case anyone is interested. NEIP probably a bankrupt printing co. with buildings for sale, and basically a shell now.

RB thread is fun to read, from last Saturday on. This was the first RB post in two months.


NEI Webworld Inc.
4646 Bronze Way
Dallas, TX 75236
Phone:(214) 330-7273
Industry:Printing Services
Officers: Barry B. Conrad, Chmn.
Richard J. Wiencek, Pres./CEO
Andrew P. Swan, COO
William K. Daniels, VP/CFO/CAO
Charles B. Combs Jr., VP.

Equity: Common Stock $.01 Par, 8/98, 20M auth., 3,719,778 issd. Insiders control 51%.
Initial Public Offering: 5/97, 1,000,000 shares @ $5.50 by First London Securities Corp. (As of 3/98) ST debt: $2M @ Prime + 1.25%; LT debt: $3.2M @ Prime + 1.5%, $2.7M @ 8.19%, $119K in capital leases.

Analyst Footnotes: 10/98, Company delisted from NASDAQ to Pink Sheets.
Shares outstanding prior to IPO are pro-forma. FY'97 financials are reclassified.

"An order has been issued granting the application of the Boston
Stock Exchange to withdraw from listing and registration NEI
Webworld, Inc. Common Stock, $.01 Par Value and Common Stock
Purchase Warrants. (Rel. 34=40897)"

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To: Jim Bishop who wrote (12)11/16/1999 8:07:00 AM
From: Wayne Rumball
   of 20
Yes it seems the LGC wireless rumor started the whole thing.

The whole affair is simply unbelievable.

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To: Wayne Rumball who wrote (13)11/16/1999 1:03:00 PM
From: RichBear
   of 20
Try to find this Co. No listing in Dallas? Phone disconnected. And people are still buying. unbelievable!!!JMHO.

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To: Jim Bishop who wrote (12)12/15/1999 7:44:00 PM
From: Arcane Lore
   of 20
Per KNBC in Los Angeles:

Alleged stock manipulation

LOS ANGELES, Dec.15 - Federal charges were filed on Wednesday against two men who allegedly used UCLA computers to post false Internet takeover messages to drive up the value of shares they held from 13 cents to more than $15.

Arash Aziz-Golshani bought 20,000 shares of NEI Web World on Nov. 12, and Hootan Melamed purchased 50,000, according to the complaint.

Over the next two days, the men allegedly used UCLA computers and aliases to post numerous messages on bulletin boards on Yahoo! and Raging Bull, falsely reporting that NEI was being bought by another company.

As a result, federal authorities say, the price of the NEI stock jumped more than 115-fold.

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To: Arcane Lore who wrote (15)12/15/1999 8:23:00 PM
From: Arcane Lore
   of 20
U.S. Charges Three Men With Web Stock Manipulation

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To: Arcane Lore who wrote (16)12/16/1999 1:50:00 AM
From: Jim Bishop
   of 20
And there we have our answer. But the schmucks, that put in market orders, well.......some lessons are only learned, the hard way.


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To: Arcane Lore who wrote (16)12/16/1999 6:52:00 PM
From: ztect
   of 20
Link to link w. SEC action...

Message 12309112

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To: Wayne Rumball who wrote ()12/18/1999 11:56:00 AM
From: Gator
   of 20
FYI: A Good Perspective on Bashing by Dan Holtzclaw:

Bashers versus the hypsters, it is the eternal struggle on the penny stock
message boards. While the hypster tries his hardest to make you buy a
particular stock, the "basher" does his best to make you sell your
hard-earned investment. How many times have you gone to your favorite
board only to see some jerk making crazy posts such as, "SELL THIS DOG
NOW!" or, "THIS STOCK WILL TANK TOMORROW!"? I see it all of the time, and
the bashers never cease to amaze me with their wild and crazy posts. Many
may wonder why a person would try to drive the price of a stock down. It?s
simple really; there are a few possible scenarios that motivate bashers.
Scenario number one: the basher once owned the stock in question, sold it
for a profit, and now he wants the price to dip so he can get back in
again at a lower price. Scenario number two: the basher has lost money on
the stock in question and is getting "revenge" by trying to tank the
price. Some people just get their kicks by angering other investors;
believe me, I?ve seen it happen. A guy who gets burned by a stock is more
than happy to go and bad mouth it to all. Compared to the hypsters, the
basher has a much simpler task at hand. It is much easier to scare someone
into selling a stock than it is to convince someone to buy one.

The basher will take any information he can find on a stock and twist it
into a frightening message. For example, anytime a penny stock has a dip
in price, the basher will claim that the stock is tanking. The basher
conveniently forgets to mention that the same penny stock just had a 50%
gain yesterday and that the current dip in the price is only 10% of the
previous day?s gain. Bashers, the good ones, often have very intimate
knowledge of the stocks that they trash. These unscrupulous fellows will
often take information out the company?s 10K and 10QSB reports and use it
to their advantage. The SEC 10K filing lists company financial data in
addition to other information such as current pending lawsuits. As is the
case with most beginning ventures the financial data for many penny stock
companies is not what one would call stellar. These businesses tend to
have large start up debt and minimal revenues. The bashers will use the
financial data in the 10K to scare investors into selling. If the
financials were so bad, why wouldn?t you sell? Well, the answer is simple.
When investing in penny stock companies you are taking a big risk. The
risk you take is entrusting your hard-earned money to a company you hope
will become profitable as their business develops. With penny stocks, as
with large cap stocks, you are investing in the future value of the
company. The key words here are future value. Bashers don?t look to the
future; they dwell on the past. Concerning lawsuits, remember that almost
all businesses have lawsuits pending against them. The basher will use the
pending legal proceedings from the 10K as ammunition for their trade.
Lawsuits sound scary and the basher knows this. It is a simple fact that
legal proceedings are a way of life for today?s business community. The
basher doesn?t tell you this, however, he only focuses on how the pending
lawsuits will "bring the company down".

A good basher can take totally legitimate information and use it to scare
off the novice investor. Newbies, unfortunately, are the usual victims of
the bashing community. A common practice in today?s business world is
using company shares as leverage in making purchases and acquisitions. An
example of this is when Yahoo purchased Geocities for a combination of
cash and company shares. The basher can take this totally benign
information and use it scare off a newbie by claiming that the purchasing
company is short on cash and is resorting to using their shares as a means
to pay the bills. How can these guys get away with such dastardly tactics?
Doesn?t the SEC monitor guys like this? The sad truth is that these
bashers are very smart folks. They know that the SEC is watching them like
the proverbial big brother. So what does the basher do to avoid the long
arm of the law? Words such as "possibly, could, may, and might" protect
the basher from the law. These few little words change a basher?s
statements from fact to fiction. A smart basher would never say, "This
company is a scam!" The smart basher, the one who stays out of prison,
says "Caution! This company may be a scam!" Do you see the difference?

Sometimes when a basher is in true form and the price of the stock in
question happens to be dropping for the day, the attention on the message
board will often stray from the stock and shift towards the basher. I have
seen it time and time again?message boards that focus on the basher rather
than the stock. As the basher infuriates the other posters with his
negative comments many investors will respond to him with threatening and
derogatory comments. This is just what the basher wants, to create
confusion and turmoil on the message board. Newcomers to the board may see
all of this infighting and get scared into selling their shares, thus
fulfilling the basher?s goal. I remember one guy in particular, let?s call
him RJ. I was involved in a particular penny stock that was experiencing a
nice run and ol? RJ jumped in at about seven and a half cents. RJ was a
regular on the board for the next few days proclaiming himself to be long
on the stock until it hit a dollar. Boy was he wrong! A few days down the
road the stock underwent a major shakeout. I?m talking about a major
shakeout here! The price of our stock had dropped over 40% in just a few
days and the bashers were having a field day. "Sell, sell!" they
exclaimed, "This dog has run its course!" RJ, the scared little newbie
that he was, took the bashers comments to heart and sold his shares at a
nickel. Following his sale RJ, the self-proclaimed long, began to bash the
stock with great abandon. RJ did not bash for monetary reasons or personal
gain. RJ was simply very upset that he had lost money and he wanted to
vent his frustrations on the rest of the remaining shareholders. I felt
sorry for RJ. I knew that we had a winner and I tried to tell RJ to hold
and ride out the shake. Unfortunately, RJ fell for the basher?s baloney. A
few days after the shakeout our stock hit an all-time high of fourteen
cents. I giggled a bit as I wondered how hard RJ was kicking himself.

hile most seem to think that bashers are bad for a stock, I would like to
offer a reason why bashers are actually a good sign for a stock. Bashers
are an intelligent lot. These guys play the game for profits pure and
simple. Think about it, if a stock was truly a dog as some of the bashers
claim why would they hang around the board? If a penny stock was truly
dead in the water the bashers would avoid it like the plague. A dead stock
makes no movement. No movement equals no profits to be made. No profits to
be made equals no bashers. Do you see where I am going with this? The mere
presence of bashers on a board indicates that a stock is still a hot
commodity. When the bashers disappear and the trading volume begins to dry
up it is time to worry. No bashers and a drop in volume indicate that a
penny stock has lost the attention of the market. This spells doom for a
penny stock. So, as I have pointed out, bashers are not always bad for a
stock. True, they may get under your skin, but bashers are a necessary
evil for a stock to be successful. How should you deal with these deviant
characters? Just ignore them. Bashers are very easy to spot. Of course,
the content of their posts gives them away, but in addition, many basher?s
like to type in ALL CAPS in order to garner attention. ALL CAPS posts are
bashers 9 times out of 10. Remember, the basher doesn?t care about you and
he is no good Samaritan. Bashers only care about themselves and their
profits. Ignore them and save yourself a headache.

Unfortunately many bashers revert to shameless name-calling and the use of
profanity in their posts. These bashers should not be confused with the
professionals. Professional bashers generally stick to the stock they are
tormenting and do not post personal messages. Should you happen to come
across a basher that is using profanity and/or racial slurs report the
poster to the webmaster of the message board. The webmaster will recognize
that the basher is violating the terms of service agreement and should
remove the culprit immediately.

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(Source: IPZ Board at Stockhouse)


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To: Arcane Lore who wrote (15)1/23/2001 4:25:36 PM
From: Arcane Lore
   of 20
From today's SEC Digest:


The Commission today announced settlements in its previously filed NEI Webworld, Inc. Internet stock-price manipulation case. That case was originally filed as an emergency action seeking preliminary relief including asset freezes on December 15, 1999. The Commission alleged that the three defendants, all recent college graduates, acquired large blocks of stock of NEI Webworld for pennies per share, created demand for the stock by disseminating false statements on the Internet that NEI Webworld, Inc. would be acquired by another company, and then sold their stock into the rising market for profits totaling nearly $364,000. The Commission subsequently amended its complaint to allege a scheme to use the Internet to manipulate the market for eleven additional issuers that continued for nearly six months. Yesterday Hootan Melamed and Allen Derzakharian, two of three defendants named in the Commission's complaint, agreed to settle the case, without admitting or denying the allegations in the amended complaint, by disgorging their trading profits and consenting to the entry of permanent injunctions against future violations of the Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. Melamed and Derzakharian agreed to surrender the contents of a previously frozen brokerage account containing their $211,250 in illegal trading profits from trading in NEI Webworld, together with prejudgment interest earned thereon. Melamed agreed to disgorge an additional $2,066 in profits and prejudgment interest from his trading in two other securities. Neither Melamed nor Derzakharian will be ordered to pay penalties based on the sworn statements of financial condition that each submitted. The Commission also filed a new action naming a fourth individual, Arash (Danny) Molayem, for participating in the NEI Webworld and other Internet manipulations. Simultaneous with the filing of the Complaint against him, Molayem also consented to the entry of a permanent injunction and agreed to disgorge his trading profits of $16,006 plus prejudgment interest. Because of Molayem's early and substantial cooperation in the investigation of this matter, the Commission did not seek to freeze his assets, and settled without seeking civil penalties against him. The Commission's complaint against Arash Aziz-Golshani, the third defendant in the original case, remains pending.

Separately, the United States Attorney for the Central District of California prosecuted Aziz-Golshani and Melamed criminally for their manipulation of NEI Webworld. Aziz-Golshani pled guilty to one count of securities fraud and one count of conspiracy to commit securities fraud. Melamed pled guilty to one count of conspiracy to commit securities fraud. Aziz-Golshani was sentenced on January 22, 2001 to 15 months incarceration, and ordered to pay restitution in an amount to be determined. Melamed was sentenced on January 12, 2001 to 10 months incarceration and also ordered to pay restitution in an amount to be determined. [SEC v. Arash Aziz-Golshani, et al., USDC, CD Cal., Civil Action No. 99-13139, CBM, AJWx]; [SEC v. Arash Molayem, USDC, CD Cal., Civil Action No. 01-00649, CBM, CTx] (LR-16867)

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