Yesterday the SEC subpoenaed Andrew Farmer and Iridium Capital after they failed to provide documents requested by the SEC in its investigation of the pump and dump of Chimera Energy (Grey market: CHMR) and “whether the claims in Chimera’s press releases are materially false or misleading.” CHMR previously had its trading suspended by the SEC last October after Infitialis accused the company of lying in press releases.
CHMR Trading suspension
SEC Litigation release
Infitialis CHMR article part 1
Infitialis CHMR article part 2
The investigation of this alleged stock fraud seems to be proceeding more quickly than is normal for the SEC although CHMR’s alleged lies were blatant: the company said it had a join venture with Pemex and the head of Pemex investor relations denied having any knowledge of Chimera.
From yesterday’s litigation release:
The SEC’s application explains that beginning in July 2012, Chimera commenced a promotional campaign that caused a dramatic increase in the trading volume and price of its stock. The SEC is investigating, among other things, whether the claims in Chimera’s press releases are materially false or misleading. On October 25, 2012, the SEC temporarily suspended trading in the securities of Chimera because of questions concerning the accuracy and adequacy of publicly disseminated information about, among other things, Chimera’s business prospects and agreements.
As part of its investigation, the staff in the SEC’s Fort Worth Regional Office issued subpoenas to Farmer and Iridium in December 2012 seeking, among other things, materials related to their transactions in Chimera securities and to Chimera’s business. According to the SEC’s court papers, Farmer played an integral role in Chimera’s transition from a privately held to a publicly traded company. And, before Chimera’s securities became available for purchase to the public on the over-the-counter market, entities controlled by Farmer or for which Farmer acted as agent acquired millions of Chimera shares in private transactions, while Iridium, which Farmer also controlled, assisted in effectuating these transactions. According to the court papers, once Chimera’s promotional campaign was under way, entities controlled by Farmer sold to the public a substantial number of their privately obtained Chimera shares, generating hundreds of thousands, if not millions, of dollars in profits.
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Criminal charges against a bunch of people connected to this: http://www.houstonchronicle.com/about/article/More-charges-filed-in-pump-and-dump-scheme-11300838.php