| From: StockDung | 6/5/2002 3:32:22 PM | | | | | | RE:Fashionmall.com, Inc.->SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
Litigation Release No. 17541 / June 5, 2002
Securities and Exchange Commission v. Sitestar Corporation, Frederick T. Manlunas and Clinton J. Sallee, 1:02CV01089 (D.D.C.) (June 5, 2002)
SEC CHARGES SITESTAR CORPORATION WITH TENDER OFFER RULE VIOLATION AND TWO OF ITS OFFICIALS WITH INSIDER TRADING
The Securities and Exchange Commission announced today the filing of a settled civil action against Sitestar Corporation and two of its officials, Frederick T. Manlunas and Clinton J. Sallee. Between August and October 2000, Sitestar announced tender offers to purchase all of the outstanding shares of Mothernature.com, Inc. and Fashionmall.com, Inc. The Commission's complaint alleges that Manlunas and Sallee engaged in insider trading by purchasing and selling shares of both target companies while in possession of material, nonpublic information relating to the tender offers. The Commission's complaint also alleges that Manlunas and Sitestar committed a separate violation by purchasing Mothernature.com stock on the open market while that tender offer was pending.
Manlunas consented to be permanently enjoined from violating Section 17(a) of the Securities Act of 1933 and Sections 10(b) and 14(e) of the Securities Exchange Act of 1934 and Rules 10b-5, 14e-3 and 14e-5 thereunder, to disgorge trading profits of $7,650, and to pay an insider trading penalty of $7,650 and a $10,000 penalty for his violation of Rule 14e-5. Sallee consented to be permanently enjoined from violating Section 17(a) of the Securities Act and Sections 10(b) and 14(e) of the Exchange Act and Rules 10b-5 and 14e-3 thereunder, to disgorge trading profits of $1,863, and to pay an insider trading penalty of $5,000. Sitestar also consented to be permanently enjoined from violating Section 14(e) of the Exchange Act and Rule 14e-5 thereunder. Manlunas, Sallee and Sitestar neither admitted nor denied the allegations set forth in the Commission's complaint.
SEC Complaint in this matter.
sec.gov
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| To: tradermike_1999 who wrote (451) | 6/11/2002 6:10:01 PM | | From: StockDung | | | | Aura Systems, Inc. ("Aura"), U.S. Securities and Exchange Commission
Washington, D.C.
LITIGATION Release No. 17557 / June 11, 2002
ACCOUNTING AND AUDITING Release No. 1575 / June 11, 2002
Securities and Exchange Commission v. Aura Systems, Inc., et al., U.S. District Court for the Central District of California (Civil Action No. 02-4555 NM) (MANx)
Securities and Exchange Commission v. Gerald S. Papazian, U.S. District Court for the Central District of California (Civil Action No. 02-04553 RMT) (AJWx)
SEC NAMES AURA SYSTEMS, NEWCOM, AND FORMER OFFICERS IN ACCOUNTING FRAUD CASE INVOLVING TENS OF MILLIONS IN REVENUE OVERSTATEMENTS AT EACH COMPANY.
AURA SYSTEMS AND FORMER CHAIRMAN KURTZMAN WERE SUBJECT OF PRIOR SEC CEASE-AND-DESIST ORDER.
The U.S. Securities and Exchange Commission today filed a settled civil enforcement action in U.S. District Court in Los Angeles against El Segundo, California based Aura Systems, Inc. ("Aura"), currently a seller of an induction power system and formerly a seller of multi-media products; its majority owned subsidiary NewCom, Inc. (now called Ncom, Inc.); and former officers of both companies. The SEC's complaint alleges that during its 1997 and 1998 fiscal years Aura overstated its revenue by at least $26.5 million by fictitiously inserting itself into the distribution chain for Korea Data Systems Co. Ltd. computer monitors that were sold to a major U.S. personal computer retailer and by recognizing revenue from nonexistent sales of computer monitors to two shell entities.
The SEC also alleges that during its 1998 and 1999 fiscal years, NewCom recorded balance sheet overstatements of at least $43.2 million by booking fictitious sales, prematurely recognizing revenue, overstating receivables, and overstating inventory. The SEC also alleged that, in two quarterly reports filed in its 1997 fiscal year, Aura improperly recognized $2.54 million in contract revenue that it had earned and booked in prior periods. The complaint alleges that these overstatements violated the antifraud provisions of the federal securities laws.
Today's complaint follows an October 2, 1996 SEC Cease-and-Desist Order entered by consent against Aura, its former Chairman and CEO Zvi (Harry) Kurtzman (also a defendant), and others for violations of the antifraud and other provisions of the federal securities laws and reflects the SEC's emphasis on identifying and seeking effective relief against recidivist securities law violators.
The complaint alleges that former Aura Chairman and CEO Kurtzman and former Aura and NewCom CFO Steven C. Veen knew or were reckless in not knowing about the Aura and NewCom overstatements and that Veen knew or was reckless in not knowing about the improper contract revenue recognition. The SEC also alleges that former NewCom Chairman and President Sultan W. Khan and former Executive Vice President Asif M. Khan knew or were reckless in not knowing about the NewCom overstatements.
Without admitting or denying the allegations in the complaint, Aura, NewCom and each of these former officers filed consents agreeing to settle the case on the following terms:
Kurtzman consented to: (a) a permanent injunction against violations of Section 17(a) of the Securities Act of 1933 ("Securities Act") and Sections 10(b) and 13(b)(5) of the Securities Exchange Act of 1934 ("Exchange Act") and Rules 10b-5, 13b2-1 and 13b2-2 thereunder; (b) a $75,000 civil penalty; and (c) a permanent officer and director bar.
Veen consented to: (a) a permanent injunction against violations of Section 17(a) of the Securities Act and Sections 10(b) and 13(b)(5) of the Exchange Act and Rules 10b-5, 13b2-1 and 13b2-2 thereunder; (b) a $50,000 civil penalty; and (c) a five-year officer and director bar. In a separate Commission proceeding, Veen also offered to accept a five-year suspension from appearing or practicing before the Commission under Rule 102(e)(3) of the Commission's Rules of Practice.
Sultan Khan and Asif Khan each consented to a permanent injunction against violations of Sections 10(b) and 13(b)(5) of the Exchange Act and Rules 10b-5, 13b2-1 thereunder with no penalty imposed based on their sworn statements of financial condition.
Aura consented to a permanent injunction against violations of Section 17(a) of the Securities Act and Sections 10(b), 13(a), 13(b)(2)(A) and (B) of the Exchange Act and Rules 10b-5, 12b-20, 13a-1 and 13a-13 thereunder, with no penalty imposed based on its Statement of Financial Information dated June 3, 2002.
NewCom consented to a permanent injunction against violations of Sections 10(b), 13(a), 13(b)(2)(A) and (B) of the Exchange Act and Rules 10b-5, 12b-20, 13a-1 and 13a-13 thereunder.
Simultaneous with the filing of the complaint, the SEC also issued a settled cease-and-desist order against former Aura President Gerald S. Papazian, finding that he knew or was reckless in not knowing that Aura's annual reports contained material misstatements resulting from the fictitious monitor sales and the improper contract revenue recognition. The order requires Papazian to cease and desist from committing or causing violations of Section 17(a) of the Securities Act and Sections 10(b) and 13(b)(5) of the Exchange Act and Rules 10b-5, 13b2-1 and 13b2-2 thereunder. In a companion civil action, Papazian consented to pay a civil penalty of $25,000. Papazian neither admitted nor denied the findings in the SEC's order nor the allegations in its complaint.
The SEC also issued a settled cease-and-desist order against Korea Data Systems USA, Inc. ("KDS"), a U.S. affiliate of Korea Data Systems Co. Ltd., and its officers Lap-Shun (John) Hui and Bun (Ben) Wong for being a cause of Aura's inclusion of the purported computer monitor sales in Aura's annual reports by making circular wire transfers that allowed Aura to record "payments" from the fictitious sales. The order requires KDS, Hui, and Wong to cease and desist from committing or causing violations of Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act. KDS, Hui, and Wong neither admitted nor denied the findings in the SEC's order. KDS also consented to pay a civil penalty of $25,000 in the civil action without admitting or denying the allegations in the complaint.
SEC Complaint in this matter.
sec.gov
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| To: tradermike_1999 who wrote (451) | 6/11/2002 7:51:25 PM | | From: StockDung | | | | This 1994 Bloomberg story described events behind today's SEC action against
Aura Systems and its former officers for fraudulently overstating revenue.
Former CEO Harry Kurtzman was banned being an executive of a public company for
life, and ordered to pay a $75k fine. Sometimes justice requires patience.
Aura Systems Raises Revenue, Eyebrows With Sales to Single Buyer
1994-07-12 15:22 (New York)
El Segundo, Calif., July 12 (Bloomberg) -- Ten days before the
end of Aura Systems Inc.'s 1993 fiscal year, a small company was
incorporated across the Los Angeles basin that immediately became
its biggest customer.
Micro Computer Distribution Power Inc. bought $2.4 million of
products from Aura that year, accounting for 22% of the El Segundo,
Calif., company's total revenue.
It was a big contract for Aura, helping the electronics
company avoid a steep drop in revenue. In fiscal 1994, Micro
Computer came through again, accounting for $4.9 million, or 30%,
of Aura's total revenue.
The sales helped foster an image that Aura was forging ahead
with its strategy to find new and lucrative commercial applications
for electronic components known as ``electromagnetic actuators.''
High hopes for the actuator business have made Aura a stock-market
darling, with a market value of $330 million, or more than 20 times
its most recent annual revenue.
In reality, the sales to Micro Computer did little but boost
sales.
According to an amended registration statement filed with the
Securities and Exchange Commission last month, the products being
shipped to the Fountain Valley, Calif., company were nothing so
flashy as magnetic actuators.
Instead, Aura simply bought plain-vanilla computer monitors
from a company in Korea and resold them to Micro Computer at
``little or no profit,'' according to the June 22 filing. For the
year, Aura's losses widened to $10.6 million from $9.6 million.
SEC Investigating
Lumping such revenue with total sales raises eyebrows among
accounting experts.
``If it was merely a turnaround, and not an integral part of
Aura's business, it should have been excluded from revenue,'' said
Abraham Briloff, Emanuel Saxe professor emeritus at Baruch College
in New York.
Aura's relationship with Micro Computer also is under scrutiny
by federal regulators. An attorney for Micro Computer, Harris
Cohen, told Bloomberg Business News that his clients received a
subpoena from the SEC as part of an investigation of Aura.
Aura officials didn't return repeated phone calls seeking
comment. An attorney for the company, John Alioto, had no comment
on the SEC investigation, which the company has never disclosed to
shareholders.
Son of a Director
In an earlier response to written questions submitted by
Bloomberg, Alioto said Aura properly disclosed its relationship
with Micro Computer in SEC filings.
Micro Computer referred all questions to Cohen, its registered
agent and the son of Aura director Harvey Cohen.
The younger Cohen, operations manager for his father's Encino,
Calif.-based money management business, Margate Advisory Group
Inc., said there was nothing amiss about Micro Computer's purchases
from Aura. He said the two companies weren't related.
``Only because I'm my father's son does it look weird,'' he
said. Harvey Cohen held 80,000 shares of Aura as of June 10.
The sales to Micro Computer illustrate the difficulty of using
revenue to analyze the value of a developing technology company,
said Elliott Mittler, a management consultant and adjunct professor
at the University of Southern California.
``You've got to be careful where the revenue's coming from,''
Mittler said. ``If you're paying a high price for low-tech revenue,
you're an idiot.''
Unfulfilled Promises
While Aura's low-tech computer monitor business was growing in
1994, the company was having less success following through on
sales of its actuator technology to potential customers.
Take Nichimen Aviation. In January, Aura said the Japanese
company agreed to buy $4.4 million of Aura's ``virtual reality''
vibrating electromagnetic vests, called ``Interactors,'' to be worn
by video-game players.
In a telephone interview from his Tokyo office last week,
Nobuaki Matsumoto, president of Nichimen Aviation, said his company
was no longer interested in the product.
``We have been investigating the possibility to distribute the
Interactor,'' said Matsumoto. ``However, we have decided not to
distribute this product.'' He said the Interactor ``is not suitable
for our business line,'' which is manufacturing aircraft parts.
Alioto said Aura ``intends to make a public announcement
concerning its contract with Nichimen and other buyers of
Interactors in the near future.''
On Monday, Aura announced plans for a $5 million advertising
campaign to promote the Interactor vests, including a promotion
with Acclaim Entertainment Inc., makers of the popular Mortal
Kombat video games.
Cold War Conversion
Aura hopes that adding the sense of feel to video games will
be one of many commercial applications for its magnetic actuator
technology, first developed for the U.S. military. It has more than
three dozen patents issued and pending for the technology.
Actuators are used to create a lateral force on command. By
harnessing the forces of electromagnetism, Aura's actuators can
provide high forces with great precision.
Actuators made by Aura are used in the military for things
like isolating vibrations in helicopters. Commercial applications
include vibrating floors and chairs in two entertainment
attractions at the Luxor Hotel in Las Vegas, powering television
loudspeakers and controlling the ignition of combustion engines.
Founded in 1987 by President Harry Kurtzman, a physicist who
spent years working for defense contractors including Hughes
Aircraft Co., Aura has never posted a profit. Over seven years, the
company has accumulated losses of $36.6 million.
Major contracts announced over the past two years promised to
boost revenue by expanding the company into new areas. However,
several of the contracts have failed to materialize.
A $30 million joint venture with Israeli Aircraft Industries
collapsed after objections by an Israeli labor union. A golf cart
manufacturer is still waiting for prototypes for almost $1 million
of electric motors it would like to buy. And the company has yet to
record any revenue from an agreement to sell television
loudspeakers to Korea's Daewoo Electronics Ltd.
Silent Speakers
In December 1992 Aura announced an agreement to sell 240,000
Aurasound television speakers to Daewoo during fiscal 1994.
On April 22, 1993, Aura said Daewoo had increased its order to
two million speakers annually, representing $4 million in sales,
beginning in June. At $1 million a quarter, that would have
produced about $3 million in sales during the final nine months of
fiscal 1994.
But Aura's 10-K for the year ended Feb. 28, 1994, lists no
revenue from speaker sales to Daewoo. All of Aura's $1.49 million
revenue from Daewoo came from a 1992 research contract to develop
a new technology for large-screen televisions, according to the 10-
K.
Aura delivered 140,000 speakers during the fiscal year,
according to the 10-K. It says Daewoo approved manufacturing
samples of Aura's speakers in early fiscal 1995.
Robotic Golf Carts
Then there are the robotic golf carts. On Aug. 16, 1993, Aura
announced a $950,000 contract to sell 10,000 electric motors for
robotic golf carts to Golf Group of America in Camarillo, Calif.
The order was subject to the delivery of 10 prototypes by Nov. 10.
Golf Group is still waiting for the prototypes. ``They haven't
completed development of that yet,'' said Bob Allen, Golf Group's
executive vice president. He said his company has built about 100
of the carts to date, with conventional motors, and is looking
forward to testing versions using Aura's actuator technology.
Aura's attorney Alioto said the company is ``expanding the
relationship'' with Golf, but that until there is a contract, the
company can't elaborate.
Fans and Foes
Aura's continued losses and lofty stock value have attracted
short sellers, investors who place bets that a stock's price will
drop by selling borrowed shares in hopes of replacing them later at
a lower price.
Since December, the number of Aura shares sold short has
almost quadrupled to more than 8 million as of June 15, giving the
stock one of the largest short interests of any Nasdaq issue.
Some analysts remain bullish about the company's prospects,
however. A nine-page report issued by Tom Fendrich, of Fendrich
Associates Institutional Research Corp. of Lawrence, N.Y., on Feb.
28 valued Aura's technology at $1 billion to $2 billion,
translating into a share price of 30 to 60. Aura currently trades
at 8 5/32.
Fendrich bases his estimate on very bullish growth
expectations. He projected fiscal 1994 revenue of $20 million,
about 22% above the $16.4 million that was later reported. He
estimates revenue of about $150 million for the current year.
In another research report also dated Feb. 28, Tony Francel of
Statewide Securities Group in Sarasota, Fla. predicted explosive
revenue growth.
Francel wrote that Aura's management is seeking to produce
revenue of about $20 million in fiscal 1994, more than $140 million
in 1995, more than $300 million in 1996, and more than $660 million
in 1997. Within five years, Francel said Aura wants to grow revenue
to ``over $1 billion.''
Asked about his projections in a brief telephone conversation
last Friday, Francel was reluctant to discuss Aura. ``It's quite a
controversial name,'' he said, declining further comment.
-- David Evans in Los Angeles (310) 827-2348, through Princeton
newsroom (609) 279-4000/br
(Story illustration: For a graph of the short interest in
Aura, type AURA US Equity SI.
For company and stock information, price graph: AURA US
<Equity> BQ, GPO.
For industry information: NI CPR, NI ELE, NI ARO.
For more on Israel: NI ISRAEL)
15:22
-0- (BBN) Jul/12/94 15:22 |
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| To: tradermike_1999 who wrote (451) | 6/11/2002 7:54:52 PM | | From: StockDung | | | | re:aura systems/Rafi Khan-> Ex-Broker Rafi Khan Is Subject of New SEC Fraud Probe (Update2)
By David Evans
Los Angeles, April 2 (Bloomberg) -- Rafi Khan, an ex- stockbroker banned from the securities industry in May, is under investigation for fraud in promoting shares of four California companies, the Securities and Exchange Commission said.
Khan allegedly issued ``buy'' recommendations on the companies -- GenesisIntermedia Inc., Aura Systems Inc., Euniverse Inc. and Ontro Inc. -- in exchange for stock or warrants issued by the companies to Pakistani firms owned by Khan's brother-in-law, including Aura Private Ltd., according to documents filed by the SEC in federal court in Los Angeles. The payments weren't disclosed, as required by law, according to the SEC.
The Pakistani companies also allegedly traded shares of the four companies and transferred the proceeds to Khan's wife, Rubina Khan, according to the documents.
``Rafi Khan may be using a brokerage account held in the name of Rubina Khan in an attempt to conceal his activities,'' SEC attorney Andrew Petillon said in a sworn statement filed with the court.
The SEC probe, which was elevated to a formal investigation on Nov. 13, became public after the agency asked a federal judge yesterday to require Rubina Khan to provide testimony about her bank and brokerage accounts.
Ontro Allegations
Khan and his wife, who live in La Canada, California, didn't return calls to their home. Officials at GenesisIntermedia, Aura and Euniverse didn't return calls. Kevin Hainley, Ontro's chief financial officer, declined to comment.
Ontro may have illegally concealed Khan's ownership and control of the company, according to the SEC's formal order of investigation, filed with the court.
Ontro's most recent proxy statement lists Aura Private Ltd. as its largest shareholder, with 2.2 million shares, or 27 percent of the Poway, California-based developer of self-heating beverage containers. Khan isn't listed as a shareholder.
Last year, Ontro permitted Aura Private to appoint two directors to Ontro's board. Harry Kurtzman, then chief executive of Los Angeles-based Aura Systems, was one of those named to Ontro's board by Aura Private.
Kurtzman resigned as CEO of Aura Systems on Dec. 31, after the SEC's staff recommended securities fraud charges against him and the money-losing maker of portable electric generators.
EUniverse, a Los Angeles operator of entertainment Web sites, hired Aura Private in January, 2001 to provide investor relations services for three years. Aura was paid warrants valued at $495,232, according to SEC filings by Euniverse.
FBI, SEC Probes
In a four-page report last May titled ``The Genie in Genesis Potentially a Mega Blow for the Shorts,'' Khan suggested a short squeeze would drive up shares of the money-losing company, which operates now-shuttered Internet kiosks in shopping malls.
In a short squeeze, investors who have lent shares to others demand them back. That forces the borrowers to buy shares, driving up the price of the stock and creating losses for the short sellers, who bet the price would fall.
Khan wrote the report after several days of meetings with GenesisIntermedia executives, said Robert Bleckman, then director of investor relations for GenesisIntermedia, in an interview at the time. Bleckman denied his company, controlled by Saudi arms dealer Adnan Khashoggi, paid Khan for the report.
GenesisIntermedia shares soared from $11.48 to $16.25 after Khan's report. Both the Federal Bureau of Investigation and the SEC are investigating allegations of stock manipulation and false accounting.
GenesisIntermedia gained a penny today to $0.011. Euniverse shares fell 95 cents to $4.65, Aura fell 3 cents to 32 cents, and Ontro was unchanged at $1.99.
Rafi Khan pleaded guilty in September 1999 to filing a false tax return and was sentenced to probation.
Banned
Last May, Khan was barred from the securities industry after agreeing to a permanent injunction forbidding him from committing securities fraud in the future. He neither admitted nor denied SEC allegations that he pocketed $552,500 by orchestrating two stock manipulations in 1993 and 1995 through ``wildly exaggerated earnings and price projections.''
Khan has previously said he made clients millions of dollars in the summer of 1993 by recommending companies such as Future Communications and Spectrum Information Technologies Corp. Share prices of both increased four-fold. He also led an unsuccessful battle to oust former Yugoslavian Prime Minister Milan Panic from his post as head of ICN Pharmaceuticals Inc. |
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| From: StockDung | 7/15/2002 1:58:17 PM | | | | | | Raoul Bertamieu A/K/A Lee Sanders the check kiter
Notices of Proposed Sale Reported on Form 144 of
MONFORT INVESTISSEMENTS Description
Click on the column header links to resort ascending () or descending ().
Company
Select a company below for more information. Relation File Date Shares Broker
ESAT INC N 9/26/2001 141,260
GLOBAL SECURITIES
ESAT INC N 2/20/2001 141,260
GLOBAL SECURITIES
ESAT INC N 10/4/2000 218,820
GLOBAL SECURITIES
ESAT INC N 5/17/2000 186,237
THOMPSON KERNIGHAN
OMNI NUTRACEUTICALS, filed this on 01/31/2000.
of the parties are as follows: TO CONSULTANT: MONFORT INVESTISSEMENTS LIMITED Avenue Louise 200 Post Office Box 112
Page 3
have duly executed and delivered this Agreement as of the day and year first above written. MONFORT INVESTISSEMENTS LIMITED OMNI NUTRACEUTICALS, INC. By: /s/ Raoul Berthamieu
----------------------------------------------------------------
CHARGE AGAINST RAOUL BERTHAMIEU IN GENERAL PARTNERS CASE Copyright 2001 Financial Times Information
All rights reserved
Global News Wire
Abstracted from Wirtschaftsblatt in German
Wirtschaftsblatt September 6, 2001 LENGTH: 175 words HEADLINE: CHARGE AGAINST RAOUL BERTHAMIEU IN GENERAL PARTNERS CASE (ANZEIGE
GEGEN BERTHAMIEU LIEGT VOR) BODY: In the suspected fraud case involving the Austrian financial company General Partners Gruppe, a charge
has been brought against Raoul Berthamieu, who was head of the insolvent General Commerce Bank AG
(formerly WMP Bank AG) for a short time. General Partners head Wolfgang Kossner could not submit the charge
himself, as he was arrested by the Klagenfurt police force, but in a search of the property of Mr Kossner's colleague,
named as 'Corinna Ch.', this charge was found on a computer diskette. However, it is now said that a charge was
brought against Belgian financier Raoul Berthamieu through official channels, and it is not clear whether this is the
charge recovered in the house search, or a separate charge. Meanwhile, the application brought by Hypo-Alpe-Adria-Bank
for insolvency proceedings against general Partners Beteiligungs AG was sent to the Vienna commercial court on August
29, but according to a privy councillor, and for unknown reasons, the document has not yet been received. Abstracted from Wirtschaftsblatt JOURNAL-CODE: WWFT LOAD-DATE: September 6, 2001 |
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| To: tradermike_1999 who wrote (451) | 7/15/2002 2:03:50 PM | | From: StockDung | | | | Asean's Saxena reveals toxic convict Ahmad in Austrian fiasco
Asean Holdings Inc AHI
Thursday June 27 2002 Street Wire
by Brent Mudry
Controversial financier Tariq Ahmad of Reno, Nev., is the latest figure named by fugitive Thai financier Rakesh Saxena in the $1-billion collapse of General Commerce Bank SA in Austria last year. (All figures are in U.S. dollars.) In a statement of claim filed Wednesday in the Supreme Court of British Columbia, Mr. Saxena and one of his offshore holding companies seek $15-million in damages against Mr. Ahmad.
The named plaintiffs are Mr. Saxena and Marcala Foundation, based in the secretive enclave of Vaduz, Liechtenstein. Marcala is described as a "financial consulting firm specializing in the structuring of equity and debt hybrid transactions." The allegations in the suit, filed by Vancouver lawyer Stewart Andree, have not yet been proven in court and a statement of defence has not yet been filed by Mr. Ahmad, the sole defendant.
The current suit follows a $10-million suit Mr. Saxena filed Feb. 18 against Raoul Berthaumieu of Belgium, the front man in the collapse of General Commerce Bank, a fraudulent bank linked to international boiler room operations. The new suit claims Mr. Ahmad worked closely with Mr. Berthaumieu and helped raise $200-million in illicit proceeds from shares of penny stock shells originally related to Mr. Saxena. According to Mr. Saxena, Mr. Berthaumieu and Mr. Ahmad met in jail in California close to a decade ago.
The General Commerce Bank fiasco, in which Mr. Saxena claims he was a major victim, is a significant setback for the Indian-born financier, himself a alleged key player in the $2-billion fraudulent collapse of Bangkok Bank of Commerce in 1996. Mr. Saxena, charged in the BBC case along with close associate Adnan Khashoggi, the Saudi Iran Contra figure, is currently fighting an extradition order from Vancouver, where he lives under self-financed $375,000-a-year house arrest in a luxury waterfront condo close to Howe Street, an international centre of penny stock dealings.
The breadth of Mr. Saxena's global finance contacts is remarkable. Last August, Stockwatch revealed the fugitive Thai financier was linked to John Douglas Reynolds, the former Howe Street promoter turned prominent Canadian politician. In numerous contacts, Mr. Saxena tried to help Mr. Reynolds work out a whopping $484,000 (Canadian) debit the politician left at Vancouver brokerage Global Securities. Mr. Reynolds's debit stemmed from a block of WaveTech Networks Inc. shares he bought after he joined the board of the Canadian penny stock promotion, a Saxena shell.
Despite the unflattering ensuing publicity, including a lead front page story in The Vancouver Sun, entitled "The Politician and the Fugitive," the controversy hardly hurt Mr. Reynolds's political stature. Mr. Reynolds, then the No. 2 man of Canada's official opposition party, propping up fast-fading Canadian Alliance leader Stockwell Day, went on to become Canada's official interim opposition leader when Mr. Day resigned, and remains a prominent figure in the reformist party, personnally attacking Prime Minister Jean Chretien over a series of government corruption scandals.
The current Saxena suit claims Mr. Saxena, his Vaduz-based Marcala and Mr. Ahmad did business with Mr. Berthaumieu, the chairman and authorized signatory of General Commerce Bank and the managing director of Pacific Federal SA, the banker's lawyer-wife Sylvie Sainlez and another offshore bank, IBL Investments Bank Luxembourg.
"Ahmad at all material times and on various material occasions, fraudulently represented himself to be a director and significant shareholder of numerous noteworthy public companies in the United States which owned substantial assets in the United States and mining operations in Pakistan," states the suit. "At a material time Berthaumieu and Ahmad as an accomplice, and each together, offered a number of negotiable instruments, which they knew to be fraudulent, to the plaintiffs and each as genuine banking transactions."
A brief review of regulatory filings shows Mr. Ahmad has kept a relatively low profile in the penny stock world, apparently generally keeping his name off filings with the United States Securities and Exchange Commission. He is, however, linked to current promotions on the barely regulated pink sheets market: Pacific Energy and Mining Co. and Pacific Star Technology Corp. Both companies use the Reno address shown for Mr. Ahmad in the Saxena suit. While Mr. Ahmad is not readily apparent in Pacific Star, the company also uses the same phone number as Pacific Energy, in which he is a player.
Pacific Energy has a curious asset mix, even by penny stock standards. In a Jan. 8 press release, showing Mr. Ahmad as the company contact, Pacific Energy claims it owns interests in broadband services, telecommunications and natural resources. In addition to claiming control of properties in the U.S. Rockies with four million tons of chrome ore and seven million tons of magnesite, Pacific Energy says it has established "high-quality, long-life oil and gas reserves." The tiny company claims it is "focused on Growth, Value and Performance as it builds a Super-Independent natural resources company."
In the press release, Pacific Energy claimed the completion of its private cable network in Reno, operated and owned by Satview LLC, in which Pacific owns a 50-per-cent stake. Mr. Ahmad claimed the private cable network provides broadband services, including television and high-speed Internet, to "high end Multi Dwelling Unit customers," and Pacific expected 90 per cent of the residents would sign up for television service by March, a phenomenally fast and high level of penetration. Mr. Ahmad claims Satview also has properties in California, Colorado and Nevada, and it projects to sign up 40,000 subscribers by the end of this year.
Mr. Ahmad has quite a history in California -- in fact, he has been a distinguished guest of the exlusive gated communities run by the state's department of corrections.
Mr. Ahmad's international entrepreneurial talents were first publicly recognized in November, 1990, when he was arrested in Reno, at age 30, on charges of illegally shipping 75 containers of hazardous waste from a Los Angeles-area laboratory to Pakistan. According to the Los Angeles County district attorney's office, Mr. Ahmad had been ordered by county health officials to get rid of hazardous chemicals in 1989 after a fire consumed his company, Shankman Laboratories.
"Prosecutors said Ahmad sent the chemicals to a company near Los Angeles International Airport to be shipped to Pakistan. During unloading, the chemicals spilled, prompting evacuation of 75 workers. The spokesman said Ahmad failed to property package the chemicals, and the Pakistani government sent them back," reported the Los Angeles Times. Federal prosecutors claim Mr. Ahmad paid $1,800 to illegally export the mislabeled toxic trove, instead of spending $80,000 to have the waste disposed of properly.
"Ahmad intended to dump the 27 55-gallon drums of hazardous waste down mine shafts in Pakistan owned by Ahmad and his family. This hazardous waste, which included cyanide, mercury and arsenic, if dumped in the ground, would severely contaminate underground drinking water supplies and seriously endanger human health," Assistant United States Attorney Stephen Mansfield told the press.
This was just the start. Mr. Ahmad was named as the key player in a federal grand jury indictment unsealed March 16, 1992, in U.S. District Court for the Central District of California. In addition to the state's toxic-waste charge, the federal indictment charged Mr. Ahmad, his brother Mobashir Ahmad, and associate Rafar Asrar, with an arson conspiracy in which his Shankman lab was torched to collect $205,000 in a fraudulent fire insurance claim.
The grand jury indictment claimed the Nov. 30, 1989, torch job was staged to look like an accidental fire, and three weeks after the fire Mr. Ahmad shipped off the toxic waste from his lab. The torcher's toxic shipment made it from Los Angeles to Dubai, where it was intercepted after Pakistani intelligence had been tipped off. Mr. Ahmad was also charged with mail fraud and perjury, stemming from the grand jury probe.
Mr. Ahmad and Mr. Asrar were convicted April 15, 1993, of the toxic waste charges and charges of arson, arson conspiracy, mail fraud and perjury. Mr. Ahmad was also convicted of money laundering. Federal prosecutors called it the first ever jury conviction for the illegal transportation and exportation of hazardous waste.
Mr. Ahmad was subsequently sentenced on Aug. 9, 1993, to eight years in a federal prison, while Mr. Asrar was sentenced a month earlier to five years. The judge also ordered Mr. Ahmad to make restitution payments of $250,000 and to forfeit $200,000 to the federal government.
While for some, an eight-year prison term might mark the end of a promising entreprenurial career, for Mr. Ahmad it was just the start.
In the current suit, Mr. Saxena claims he heard distressing news six months ago. "In December, 2001, the plaintiffs were informed that Pacific (Federal) was not allowed to engage in securities transactions under the laws of its country of incorporation, Belgium, and that Ahmad and Berthaumieu had developed their conspiratorial association while serving jail time for serious California convictions which actually bared (them) from performing many of the public company related activities."
Mr. Berthaumieu, who used the alias Lee Sanders then and now, had the misfortune of being convicted in 1991, when he pleaded guilty to felony bank fraud for writing $1.6-million in rubber cheques. The Belgian-born Canadian national, then 46 and living in the Los Angeles suburb of Woodland Hills, was arrested on a sealed grand jury indictment in June, 1990, in Melbourne, Australia, a credential few other bank chairmen can boast of.
California's prison system actually deserves full credit as the spawning ground for the General Commerce fiasco in Austria years later. According to Mr. Saxena, at least three other key General Commerce figures were in jail in California in the early 1990s.
"Sherman (Mazur) met Raoul (Berthaumieu) in jail," says Mr. Saxena, who knows quite a bit about the General Commerce Bank players.
Mr. Mazur, then 43, capped a lengthy criminal investigation in July, 1993, when he pled guilty to seven counts of bankruptcy and tax fraud in federal district court in the United States District Court in the Central District of California in Los Angeles. The guilty plea came less than a week before he was to face the start of a trial on 74 fraud-related criminal charges.
The highflying financier, who boasted a fleet of eight or nine luxury cars including a Ferrari and two Rolls-Royces, was prosecuted for milking and bilking many of the 200 real estate limited partnerships he headed. Mr. Mazur's veneer of respectable success peeled away after he was indicted in 1991.
On Dec. 1, 1993, U.S. District Court Judge Ronald Lew sentenced Mr. Mazur to six years in prison and a $250,000 fine. (This was on top of the $500,000 restitution the fraudster agreed to in his plea negotiations.) Prosecutors called the Mazur saga one of the largest cases of tax fraud at the time. Mr. Mazur "should be punished for the greed he has shown," Assistant U.S. Attorney Maureen Tighe, the lead prosecutor, told Judge Lew.
The jailhouse legend is even richer. According to Mr. Saxena, while Mr. Mazur and Mr. Berthaumieu spent several years together in California, they also met a chap in jail who later became General Commerce Bank's representative in London. "It is stranger than fiction," says Mr. Saxena, whose courtroom opponents might suggest he is indeed an expert on the subject of fiction.
Mr. Mazur, Mr. Berthaumieu, Mr. Ahmad and their London associate were not the only General Commerce Bank key players to learn a thing or two in jail. Regis Possino, who still lives in the Los Angeles area, was convicted in 1978 in an entertaining drug sting, sentenced to one year in jail, and disbarred in 1984. The budding young lawyer had offered to sell half a ton of pot and $5-million worth of stolen bonds to undercover agents.
While Mr. Possino has been quite active in controversial penny stock promotions in recent years, Mr. Saxena claims he was outranked by Mr. Sherman in the behind-the-scenes structure of General Commerce Bank. "Sherman is the main player; he is the front guy," Mr. Saxena told Stockwatch. "Berthaumieu reported to Sherman, not to Regis."
In the latest suit, Mr. Saxena traces his unfortunate General Commerce Bank dealings back to November, 2000. "Berthaumieu requested the plaintiffs to conduct highly specialized investment banking services for GCB and Pacific (Federal) offering to pay the customary fee and commission of between 5 per cent and 12 per cent of the face value of each transaction."
The suit claims that in December, 2000, Mr. Saxena and his Vaduz holding company, relying on the representations of Mr. Berthaumieu and his lawyer-wife Ms. Sainlez, structured a $100-million convertible loan transaction between a major Turkish steel producer and General Commerce Bank.
This is where it gets really interesting. "On or about May, 2001, Berthaumieu arranged that GCB make and deliver a $1-million (US) GCB promissory note to the order of a Canadian resident and his U.S. corporation in return for the right to acquire, for merger purposes, four U.S. shell companies," states the suit. The court filing notes Mr. Saxena and Marcala, his Vaduz company, arranged these transactions and were entitled to a fee and commission.
Unfortunately, Mr. Saxena later found he was victimized. "On or about May 2002, the plaintiffs received evidence that Berthaumieu, without informing Saxena and without completing purchase of the within U.S. shell corporation, clandestinely sold shares in one or more of the shell corporations to European investors and converted the proceeds (approximately $200-million US) to himself and his accomplice Ahmad," states the suit.
The suit also claims that last July, Mr. Berthaumieu and Ms. Sainlez arranged for General Commerce Bank to make and deliver GCB promissory notes "to the order of two U.S. corporations" with a dollar value exceeding $27-million in order to acquire majority shares in an American public company and to purchase a business to be merged into this listed company.
The busy bankers had much more on the go. "On or about July-August 2001, Berthaumieu requested the plaintiffs to arrange that Pacific (Federal) purchase two U.S.-based broker-dealers," states the suit. The court action claims that while Mr. Berthaumieu negligently failed to close the purchase of these two unidentified brokerages, substantial fees and commissions were due to Mr. Saxena. The suit claims that to compensate for these fees and commissions, Mr. Berthaumieu signed some agreements.
"On or about August 13, 2001, Berthaumieu, Sainlez and Ahmad arranged the issuance of promissory notes (Face Value $40-million U.S.) made by Eurolinks Ltd. (a nominee corporation purported to be owned by Berthaumieu and Ahmad) which relied, for security purposes, upon the businesses purportedly controlled and owned by Ahmad in the U.S. and in Pakistan," states the suit.
Mr. Saxena claims his lucrative fee deals began unravelling between last September and December, when he discovered that Mr. Berthaumieu was never authorized to act on behalf of General Commerce Bank, which rendered the promissory notes just worthless paper. It got worse in January, when Mr. Saxena claims he discovered Mr. Ahmad was never authorized to transact the assets linked to the promissory notes and that Mr. Ahmad did not exercise any recognizable control over the subject assets.
Mr. Saxena and Marcala, his Vaduz company, now seek damages of $15-million after this distressing experience of high-level deception.
bmudry@stockwatch.com
(c) Copyright 2002 Canjex Publishing Ltd. stockwatch.com |
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| To: tradermike_1999 who wrote (451) | 8/19/2002 1:18:36 PM | | From: StockDung | | | | Adnan Khashoggi. On 19th June 1998 a UK registered company obtained a Judgement in
The High Court of Justice, London against
Mr Adnan Khashoggi
in the amount of £3,200,000
(Three Million Two Hundred Thousand Pounds).
Of this Judgement £3,000,000 (Three Million Pounds) remains unsatisfied.
A substantial reward is offered for information that leads directly to the
satisfaction of this Judgement. All information will be dealt with initially by
Ellis & Fairbairn, Solicitors.
Please make contact in the first instance by email.
216.239.39.100 |
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| From: StockDung | 8/19/2002 1:34:35 PM | | | | | | Chandraswamy received forex from Adnan Khashoggi: ED
PTI
New Delhi, May 24
--------------------------------------------------------------------------------
The Enforcement Directorate on Friday filed a complaint against tantrik Chandraswamy accusing him of receiving foreign exchange worth over Rs 2.16 crore from six persons including controversial arms dealer Adnan Khashoggi in violation of FERA provisions.
Taking cognizance of the ED complaint, Additional Chief Metropolitan Magistrate (ACMM) V K Maheshwari issued summoned to Nemi Chand Jain alias Chandraswamy asking the accused to appear before him on August 6.
The complaint filed by Enforcement Officer S C Adhlakha through counsel Naveen K Matta contradicted Chandraswamy's claim that the amount received by him was in the form of donations for his Vishwa Dharmayatan Trust.
According to the ED complaint, Chandraswamy received forex worth Rs 78.07 lakh sent by Adnan Khashoggi from the US and Rs 77.95 lakh remitted by NRI businessman Rakesh Saxena from Thailand. The accused, also received foreign exchange worth Rs 12.03 lakh from Som Chai Chawla, another NRI residing in Thailand.
The other persons from whom the accused received foreign exchange were: Abdul Ismail- Rs 31.23 lakh and Akbar Veeraji - Rs 7.61 lakh from England and one Rajeev Lulla who sent forex worth Rs 10 lakh.
The accused failed to furnish any evidence showing permission of the Reserve Bank of India (RBI) to enter into the aforesaid transaction, ED alleged. |
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| From: StockDung | 8/20/2002 10:11:28 PM | | | | | | Yet another Possino/General Commerce Bank AG Boiler Room stock ready to bite the dust
JUNUM INCORPORATED
Form 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended June 30, 2002
[] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from to----------------- ----------------Commission File Number: 021566--------------------
JUNUM INCORPORATED
Sales $1,108,619
Selling, General & Admin Expenses $1,151,231
Basic and diluted net (loss) per weighted average share$(0.02)
Currently, the Company has a limited amount of cash and liquid assets. While there have been improvements in operating results, the Company was not cash flow positive in the second quarter of 2002. Unless there is continued growth in profitable revenues, the Company will not be able to meet its short-term cash needs. In addition to covering its ongoing operating costs, the Company will need additional cash to satisfy its existing debt obligations and to underwrite the complete implementation of its business plan. It is likely that the Company will be required to seek outside funding in order to accomplish its objectives. Junum's ability to raise needed funds thorough public or private equity or debt financing, or other sources, is uncertain.
As mentioned previously, the introduction of these new products has been delayed due to lack of resources and the necessary revamping of the business model.
On August 14, 2002, the Company received a letter which threatened civil litigation against the Company and its directors and officers based upon alleged violations of federal and state securities laws and breaches of fiduciary duties. The allegations relate to the conversion of preferred stock into the common stock of the Company, disclosures of stock options, executive bonuses, and related issues. The Company is unable to fully evaluate or qualify the effects that such litigation may have upon the Company, but it may materially and adversely affect the Company.
The Company is currently involved in several other adversarial proceedings. Much of this litigation relates to unpaid liabilities. Individually or in combination, several of these claims could have a material impact on the Company's assets, operations, or financial condition. The Company has booked reserves in its financial statements deemed by management to be adequate to cover anticipated judgments, legal fees, and other costs associated with ongoing and potential litigation.
The Company is currently in default on various convertible debentures and other promissory notes representing an unsecured liability of $300,000 plus accrued interest. The Company is in danger of defaulting on an additional $810,000 in secured long-term debt due to the breach of a debt covenant. The Company intends to actively negotiate with the holders of these debt securities in an effort to remedy the defaults.
secfilings.nasdaq.com |
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