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   Biotech / MedicalGMXX - GENEMAX CORP


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From: StockDung5/15/2006 9:27:34 PM
   of 978
 
GENEMAX CORP: NT 10-Q, Sub-Doc 1

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

OMB APPROVAL

OMB Number: 3235-0058
Expires: April 30, 2009
Estimated average burden hours per response . . . 2.50


SEC FILE NUMBER
000-27239



FORM 12b-25



NOTIFICATION OF LATE FILING

(Check One): ¨ Form 10-K ¨ Form 20-F ¨ Form 11-K x Form 10-QSB ¨ Form N-SAR ¨ Form N-CSR

For Period Ended: March 31, 2006.
¨ Transition Report on Form 10-K
¨ Transition Report on Form 20-F
¨ Transition Report on Form 11-K
¨ Transition Report on Form 10-Q
¨ Transition Report on Form N-SAR

For the Transition Period Ended: Not applicable.

Nothing in this form shall be construed to imply that the Commission has verified any information contained herein.

If the notification relates to a portion of the filing checked above, identify the Item(s) to which the notification relates:



PART I - REGISTRANT INFORMATION

GENEMAX CORP.
Full Name of Registrant

Not applicable
Former Name if Applicable

Suite 400, 1681 Chestnut Street
Address of Principal Executive Office (Street and Number)

Vancouver, British Columbia, Canada, V6J 4M6
City, State and Zip Code

__________

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

PART II - RULES 12b-25(b) AND (c)



If the subject report could not be filed without unreasonable effort or expense and the registrant seeks relief pursuant to Rule 12b-25(b), the following should be completed. (Check box if appropriate)

(a) The reasons described in reasonable detail in Part III of this form could not be eliminated without unreasonable effort or expense;

x
(b) The subject annual report, semi-annual report, transition report on Form 10-KSB, Form 20-F, 11-K or Form N- SAR, or portion thereof will be filed on or before the fifteenth calendar day following the prescribed due date; or the subject quarterly report or transition report on Form 10-QSB, or portion thereof will be filed on or before the fifth calendar day following the prescribed due date; and

(c) The accountant's statement or other exhibit required by Rule 12b-25(c) has been attached if applicable.




PART III - NARRATIVE



State below in reasonable detail the reasons why Form 10-K, 20-F, 11-K, 10-QSB, 10-D, N-SAR, N-CSR, or the transition report or portion thereof could not be file within the prescribed time period.

Management was unable to obtain the business information necessary to complete the preparation of the Company's financial statements for the period ended March 31, 2006 and the review of these financial statements by the Company's auditors in time for filing. Such information is required in order to prepare a complete filing. As a result of this delay the Company is unable to file its interim report on Form 10-QSB within the prescribed time period without unreasonable effort or expense. The Company expects to file within the extension period.

__________

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

PART IV - OTHER INFORMATION



(1) Name and telephone number of person to contract in regard to this notification.

Patrick A. McGowan
(Name)
604
(Area Code)
301-9545
(Telephone Number)




(2) Have all other periodic reports required under section 13 or 15(d) of the Securities Exchange Act of 1934 or Section 30 of the Investment Company Act of 1940 during the preceding 12 months or for such shorter period that the registrant was required to file such report(s) been filed? If the answer is no, identify report(s). x Yes ¨ No



(3) Is it anticipated that any significant change in results of operations from the corresponding period for the last fiscal year will be reflected by the earnings statements to be included in the subject report or portion thereof? ¨ Yes x No



If so: attach an explanation of the anticipated change, both narratively and quantitatively, and, if appropriate, state the reasons why a reasonable estimate of the results cannot be made.



GENEMAX CORP.

(Name of Registrant as Specified in Charter)

has caused this notification to be signed on its behalf by the undersigned thereunto duly authorized.



Date: May 15, 2006
By: /s/ Patrick A. McGowan

_________________________
PATRICK A. McGOWAN
Secretary, CFO, PAO and a director


__________

Copyright © 2006 QuoteMedia. All rights reserved. Terms of Use.
Market Data powered by QuoteMedia, www.quotemedia.com, SEC filings by 10kWizard.


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From: StockDung12/12/2007 1:09:43 PM
   of 978
 
The rise and impending fall of yet another OTC stock

A nondescript B.C. exploration company buys a Washington-based biotech that makes a 'miracle' pill

David Baines
Vancouver Sun
Wednesday, December 12, 2007
canada.com

CellCyte Genetics Corp. is like watching a car collision in slow motion. We are just moments from impact. The traffic cops are nowhere in sight. Casualties will soon litter the street. We can only watch.

As noted in my Nov. 24 column, CellCyte began as a nondescript Vancouver exploration company called Shepard Inc. The two senior officers were Michael Eyre, owner of a Richmond car dealership, and Glen Macdonald, a Vancouver geologist who is actively involved in creating shell companies.

The company, with the help of Vancouver chartered accounting firm Morgan & Co. and Vancouver geologist Bill Timmins, filed a registration statement with the U.S. Securities and Exchange Commission in 2005 as a prelude to trading on the OTC Bulletin Board.

It was difficult to believe this was an earnest business endeavour. Shepard had only one mineral claim in the Northwest Territories, costing just $2,500. By all appearances, it was being created for some ulterior purpose.

Sure enough, in January this year the company announced it would acquire CellCyte, a Kirkland, Wash.-based company "engaged in the discovery and development of breakthrough stem cell enabling therapeutics."

In June, CellCyte -- with the help of filing solicitor Thomas Deutsch of Vancouver law firm Lang Michener -- filed a disclosure statement showing, among other things, that one of its major shareholders was Newport Capital Corp., a Zurich company controlled by Brent Pierce, who is currently serving a 15-year stock market ban in B.C. for fraud.

For years, Pierce has been able to tip-toe around his ban by promoting U.S. over-the-counter companies like CellCyte -- which are not B.C. reporting issuers and therefore outside the jurisdiction of B.C. securities regulators.

His other promotions have included Lexington Resources (high $7.46, now one cent); Uranium Energy (high $9.25, now $3.30); Morgan Creek Energy (high $5.40, now 30 cents); GeneMax (high $47, now 21 cents); and Geneva Gold (high $3.50, now $1.50).

Now Pierce is focussing on CellCyte. In October, he hired U.S. pen-for-hire James Rapholz to tout the stock:

"Now, a practical 'pill-in-a-bottle' application puts the miracle of regenerative medicine within immediate reach!" Rapholz gushed in a 12-page report.

At the time, the stock had levitated to $5.70, but he clearly expected much more: "Invest just $5,000 now . . . and you could have $7 million."

To produce and distribute this piece of hysteria, Pierce (through his private company, Stockgroup AG) paid Rapholz a stunning $445,000.

By last week, the stock had climbed to $7.35, giving the company a total stock market value of $440 million. The action caught the eye of Seattle Times biotech reporter Angel Gonzalez, who published a story on the front of the newspaper's business section this past Sunday.

Entitled "CellCyte shares ride a wave of hype," the article noted the company "is still a year away from its first early-stage clinical trials" yet its market capitalization exceeds many Seattle-area biotechs "far more advanced in developing therapies."

The article also quoted CellCyte co-founder, president and CEO Gary Reys as saying, quite incredibly, that "his lawyers investigated Pierce and found nothing wrong."

The article -- as damning as it was -- didn't even put a dent in the share price. For the moment, at least, the stock seems to be operating in its own universe, well beyond the laws of supply and demand. And not a regulator in sight. A slow-motion nightmare.

- - -

A former certified general accountant who allegedly embezzled just under $1 million from his employer has been charged with fraud.

On Nov. 26, Burnaby RCMP charged Wade Chernoff, former controller of Taiga Building Products Ltd., with one count of defrauding Taiga of more than $5,000.

Mark Schneidereit, Taiga's manager of corporate planning, said Chernoff worked at the firm from January 1997 to October 2005, when he voluntarily resigned.

He said that, after Chernoff left, the company discovered he had embezzled large amounts of money over more than three years.

In May 2006, the company filed a lawsuit in B.C. Supreme Court alleging Chernoff had "abused his position at Taiga through a fictitious invoice scheme under the guise of Chernoff's personal company, SPF Lumber Ltd., totalling approximately $982,000."

Schneidereit said Chernoff has fully cooperated in the recovery efforts: "We have already recovered a substantial amount, and we expect to recover the full amount," he said.

He declined to say why Chernoff took the money. Chernoff could not be reached for comment Tuesday.

Meanwhile, Burnaby RCMP commenced a criminal investigation. Last week, the Certified General Accountants Association of B.C. issued a release advising that Chernoff had been charged.

The association also noted that Chernoff was deemed to have resigned as a CGA on Aug. 1, 2006 for failing to pay annual dues.

Schneidereit said the company did not issue a release about the embezzlement because the amount was not deemed material to the company's affairs.

He also noted that the embezzlement occurred under former management. "Current management has put into place an internal auditor to prevent future occurrences," he said.

Taiga, based in Burnaby, distributes building products through 14 distribution centres across Canada and one in northern California. It also produces treated wood at three facilities in Canada.

The company's shares are publicly traded on the Toronto Stock Exchange. During the year ending March 31, the company generated $1.1 billion in revenues and $4.1 million in net profits. Total assets were $304 million.

dbaines@png.canwest.com

canada.com

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To: StockDung who wrote (969)12/12/2007 1:15:13 PM
From: StockDung
   of 978
 
Brent Pierce and his band of Canadian grifters where the origional leaders of the Baloney Brigade in the fight against naked short selling.

They where replaced with Bob O'Brien after they closed down their baloney investors advocate site.

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From: StockDung2/25/2008 6:14:16 PM
   of 978
 
TapImmune (formerly GeneMax) taps into the immune system to take out autoimmune disorders and transplant tissue rejection. Its research is primarily focused on the cells' TAP system that triggers an immune system response. The TAP system shuts down in many cancer tumor cells, but the company is developing a vaccine to restore the immune function. TAPImmune's other potential products include a Peptide Transfer Assay (IPTA) technology that identifies compounds which modulate the immune system. It has also licensed a technology to screen and select potential drugs to regulate immune responses. The company in 2007 underwent a reverse merger with its TapImmune subsidiary, after which the GeneMax name was retired

. biz.yahoo.com

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From: StockDung8/4/2008 2:14:44 PM
   of 978
 
Anti-Short Crusaders Accused Of Illegal Sales

By Carol S. Remond
31 July 2008
Dow Jones News Service
(c) 2008 Dow Jones & Company, Inc.

Brent Pierce and Grant Atkins, two Canadian citizens who were central in crafting an anti-short-selling campaign back in 2002, are now accused of violating federal securities registration laws.

According to a cease-and-desist order issued by the Securities and Exchange Commission Thursday, Pierce, Atkins and a now bankrupt company named Lexington Resources Inc. illegally sold stock without properly registering it with the commission.

The SEC alleges that stock promoter Pierce and his associates spearheaded a massive promotional campaign to pump the stock and improperly resell it to the public through an account at an unidentified offshore bank. The SEC alleges that the illegal sales generated proceeds of "over $13 million."

Atkins declined to comment or provide the name of his lawyer. Pierce couldn't immediately be reached. A recording on a Swiss cellphone listed for Newport Capital Corp., a firm for which Pierce is a director and officer, advised callers to try later.

Atkins and Pierce have 20 days to reply to the allegations in the SEC order.

The two have been involved with several small-cap companies over the years. Back in 2002, Atkins and Pierce were associated with Investor Communications International Inc., a Blaine , Wash. , promotional firm that was a large investor in a budding pharmaceutical company named GeneMax Corp.

In a move designed to hamper short sellers who were taking bearish bets on the company, GeneMax that year attempted to exit the global electronic settlement system managed by the Depository Trust & Clearing Corp., or DTCC.

The campaign to exit DTCC gained some support among small companies, mostly trading on the over-the-counter bulletin board, that believed they were subject to illegal short selling. But the move was later defeated by the SEC, which ruled that investors, not companies, should decide whether to hold securities in electronic or physical format.

Atkins, who had been president of the shell company used to take GeneMax public, was a director of the company and a consultant for ICI. Meanwhile, Pierce was identified as a shareholder, "controlling person" and president of ICI in two filings with the SEC.

Making Popular 'Naked Shorts'

In September 2002, GeneMax filed lawsuits against two Canadian brokerage firms, alleging stock manipulation. A month later, the company filed suit against various broker-dealers in the U.S. , accusing them of illegal, or naked, short selling.

Both suits were later dismissed. But the suit filed in federal court soon became a model in a still-ongoing legal campaign against DTCC and brokerage firms accused by some companies of facilitating abusive short selling.

Several of these suits have been dismissed over the years. Most recently, online discounter Overstock.com (OSTK), Canadian companies Biovail Corp. (BVF) and Fairfax Financial Holdings (FFH) filed suits in state courts alleging some form of abusive short selling. Those suits are ongoing.

(The term "naked short selling" gained prominence earlier this month after SEC Chairman Christopher Cox used it to explain the adoption of an emergency order to protect 17 financial institutions and mortgage behemoths Fannie Mae (FNM) and Freddie Mac (FRE) from investors betting against their stocks. Short sellers typically borrow stock in the hope of profiting when the price of the security goes down. Short-selling without borrowing the stock has been dubbed naked short selling.)

This is hardly the first time that an insider who claimed that his company was victim of illegal short selling is accused of improperly selling stock.

In 2005, the SEC sued Gary Valinoti, alleging that the former chief executive officer of Jag Media Holdings Inc. (JAGH) engaged in unregistered sales and transfers of securities. Without admitting or denying the SEC allegations, Valinoti agreed to settle the charges and consented to a final judgment that permanently enjoins him from violating securities laws. Under the deal, Valinoti agreed to disgorge about $2.9 million in illicit gains and to pay $1.39 million in pre-judgment interests.

Jag Media, like GeneMax, had sued brokerage firms it accused of manipulating its stock. That suit was also dismissed.

Same goes for Universal Express Inc. (USXP), another self-proclaimed poster child of the abuse of naked short selling. The SEC sued Universal Express and Chief Executive Richard Altomare in 2004, accusing them of selling 500 million unregistered shares into the market, using erroneous press releases to prop the company's stock price.

The company went into receivership last year and Altomare recently served several months in jail for failing to pay his share of a $21.9 million fine imposed by the SEC.

All fine examples of companies and insiders complaining of naked short selling whom Chairman Cox might want to consider before extending his restrictive short-selling order to other securities.

(Carol S. Remond is an award-winning columnist who won a Gerald Loeb Award in 2005 for best news service content with "Exposing Small-Cap Fraud," a series of articles that described how three small companies unscrupulously pumped up their stocks.)

-By Carol S. Remond; Dow Jones Newswires; 303-997-5783 ; carol.remond@dowjones.com

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From: StockDung6/8/2009 11:11:15 AM
   of 978
 
sec.gov

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From: StockDung6/10/2010 8:24:35 AM
   of 978
 
ANTI-NAKED SHORT SELLING FOUNDER BRENT PIERCE SUED BY SEC FOR ALLEDED ILLEGAL TRADING. BRENT PIERCE OF GENEMAX FAME.

THE SITH LORD HAS HIS DAY!!

Please Note: This site has been established to bring members together and create a National voice for companies that fall victim to predatory trading and Naked Short Selling. Please register now to receive information by email on Naked Short Selling, news about the association and ways you can combat this illegal activity
nakedshortselling.com (NOW A PORN SITE)

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

Vancouver stock promoter faces $8-million suit in U.S. for illegal trading

By Staff reporter, The Province June 9, 2010

SAN FRANCISCO — Vancouver stock promoter Brent Pierce is being sued for $8 million by the U.S. Securities and Exchange Commission after alleged illegal trading through two offshore properties.

The SEC is seeking to recover the money that it claims Pierce collected through accounts in Newport Capital Corp. and Jenirob Company Ltd. The SEC claims Pierce secretly controlled and concealed the operations from regulators.

"The promoters behind lucrative stock schemes frequently operate behind a wall of secretive offshore entities," says Marc Fagel, regional director of the San Francisco SEC office.

In a press release, the SEC reports that Pierce was found in a previous action to have violated the federal securities laws in connection to the trading of stock from Lexington Resources Inc., a now defunct oil and gas company. At the time, Pierce was ordered to pay back from his personal account about $2 milllion in illegal trading profits.

The SEC alleges that in 2004, Pierce controlled Lexington and sold 1.6 million shares in the stock to the public through the Newport and Jenirob accounts for almost $8 million — while Pierce and his associates "conducted massive spam and newsletter campaigns outting Lexington stock."

A hearing will be scheduled to determine future actions.

© Copyright (c) The Province

Read more: theprovince.com

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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.

dbaines@vancouversun.com

© Copyright (c) The Vancouver Sun

Read more: vancouversun.com

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From: StockDung5/20/2014 1:29:52 PM
   of 978
 
Anti naked short selling advocate losses apeal

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

SEC target Pierce loses Lexington appeal

2014-05-20 13:15 ET - Street Wire

Also Street Wire (C-*SEC) U.S. Securities and Exchange Commission
Also Street Wire (U-LXRS) Lexington Resources Inc

by Mike Caswell

The U.S. Securities and Exchange Commission has denied an appeal by West Vancouver's Gordon Brent Pierce of his second penalty for selling unregistered shares of Lexington Resources Inc. The regulator has ordered him to pay $7.24-million in disgorgement and $4.21-million in interest. (All figures are in U.S. dollars.) In rejecting the appeal, the SEC has found that the second Lexington case against Mr. Pierce was only necessary because he fraudulently concealed his control over shares he held through two offshore companies.

GORDONBRENTPIERCE.COM
Brent Pierce

The appeal stems from the 2004 promotion of Lexington Resources, a purported Oklahoma oil and gas company. The SEC filed two administrative actions against Mr. Pierce for Lexington, and won $2.04-million in sanctions in the first and $7.24-million in the second. An administrative law judge found that Mr. Pierce had arranged for a spam campaign to tout the stock, and then sold shares through accounts at Hypo Bank in Liechtenstein.

The remainder is available to Stockwatch subscribers. Click the yellow link above for a free trial subscription. © 2014 Canjex Publishing Ltd. All rights reserved.

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From: StockDung7/8/2015 4:32:43 PM
   of 978
 
SEC target Pierce challenges Lexington findings again

2015-07-08 12:16 ET - Street Wire

Also Street Wire (U-*SEC) U S Securities and Exchange Commission
Also Street Wire (U-LXRS) Lexington Resources Inc

by Mike Caswell

Vancouver's Brent Pierce has filed yet another legal challenge to the substantial penalty he received from the U.S. Securities and Exchange Commission for the Lexington Resources Inc. scheme. He has requested the U.S. Court of Appeals conduct an en banc review of a ruling that upheld $11.45-million in sanctions on him. (All figures are in U.S. dollars.) He complains that the SEC unfairly penalized him twice for the same promotion.

The review request is part of a lengthy legal action stemming from the 2004 promotion of Lexington Resources, a purported Oklahoma oil and gas company. The SEC claimed that Mr. Pierce personally sold $2.04-million worth of stock while paying for a spam campaign that boosted the company. The regulator also said that he sold $7.24-million worth of stock through two private entities using offshore accounts in Liechtenstein.
GOOGLE+
Brent Pierce

Mr. Pierce's appeal, filed on Monday, July 6, centres around the fact that the SEC obtained the fines through two separate proceedings. The regulator first pursued him solely for the amounts he sold personally. The SEC then filed a new case in which it fined him for the selling through the corporate entities. As Mr. Pierce sees it, the fact that the SEC pursued him a second time violates a legal principal called res judicata (which means that a matter may only be litigated once).

His argument is not a new one. He previously made the same complaint in an internal appeals process at the SEC. That process culminated in a hearing presided over by a panel of five SEC officials, including chairman Mary Jo White. On March 8, 2014, the panel ruled against Mr. Pierce, finding that the second case was only necessary because he had provided information that turned out to be untrue. He had fraudulently concealed his role with the two entities that sold $7.24-million worth of shares, the panel ruled. The SEC also recalculated the amount he owed, pegging it at $11.45-million with interest.

Mr. Pierce then went to the courts, asking the U.S. Court of Appeals to hear the matter. In a ruling handed down on May 22, 2015, a three-judge panel found against him as well, agreeing that he had fraudulently concealed his holdings. In sworn testimony he had denied having control over an account, but that turned out to be untrue, the three judges found.

The difference between Mr. Pierce's prior appeal and his present one is that he is seeking a review en banc, or before a larger panel of judges than the three that previously heard his case. His appeal request does not automatically result in such a hearing. The court ordinarily only considers such hearings when the matter is of exceptional importance.

Although much of what Mr. Pierce is arguing in Monday's review request looks to repeat his prior appeals, he has added a complaint about the administrative law judge who initially imposed the fine. He contends that the judge was not properly appointed. As with most cases at the appeal court, the argument hinges on points of law and is nearly incomprehensible to an ordinary reader. Essentially, Mr. Pierce says that the judge's appointment did not follow the requirement of being done by the president, a court of law or a department head.

Pierce's Lexington fines

Whatever the outcome of Mr. Pierce's review request, it comes nearly seven years after the SEC initially cited him for the Lexington promotion. In an administrative order dated July 31, 2008, the regulator claimed that he pumped the stock to $7.50 from $3 with spam, tout sheets and advertising on investing websites. The regulator held a three-day hearing for Mr. Pierce in February, 2009, in Seattle. Mr. Pierce did not attend, citing concerns he could be arrested in the United States for his role with another company, CellCyte Genetics Corp. The judge found his failure to appear was unexpected and she drew an "adverse inference" from it. She eventually imposed the $2.04-million fine.

The SEC's second case, which it filed on June 8, 2010, cited Mr. Pierce for selling Lexington shares through accounts in the names of two private entities, Newport Capital Corp. and Jenirob Ltd. The SEC said that the two companies held 1.6 million shares of Lexington at Hypo Bank in Liechtenstein. The regulator had previously been unable to determine beneficial ownership of those shares because of privacy laws in Liechtenstein, but eventually discovered that Mr. Pierce owned them. Mr. Pierce lost the second case as well, with a judge finding against him on July 27, 2011. The judge assessed his proceeds from the sales as $7.24-million and ordered him to pay that amount, plus interest.

For Mr. Pierce, the SEC is not the only regulator looking at his Lexington actions. On May 19, 2015, the B.C. Securities Commission applied to permanently ban him from the markets, citing his contempt for the securities and regulatory system. Among other things, the BCSC cited the Lexington case, noting in particular that Mr. Pierce lied to SEC staff and had not shown any recognition that his conduct was wrong. The BCSC has not yet scheduled a hearing for Mr. Pierce.

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