Fake hard mailer on Dephasium Corp (DPHS)

Last Friday, @StockBrainiac (run by Equities Awareness Group) tweeted about an upcoming hard mailer promoting Dephasium Corp (DPHS).

Over the weekend a few crappy stock promoters pumped the stock.

LiquidTycoon has agreed to be compensated fifteen thousand dollars for a one day public awareness marketing campaign for DPHS from the third party StockMister LLC.

The same promoter that runs that website runs the following websites:

PennyStockMoneyTrain.com
PennyStockPickAlert.com
SuperHotPennyStocks.com
SuperNovaStockPicks.com
LiquidTycoon.com
TheInformedStockInvestor.com
WinningPennyStockPicks.com
TheStockPickingMoneyTree.com
WePickPennyStocks.com
WallStreetNewsRelease.com

DPHS was also promoted by Joepennystocks.com / PennyPickAlerts.com:

 JoePennyStocks has been compensated $15,000.00 USD by StockMister LLC for a one day Awareness Campaign on DPHS

And by Openingbellreport.com:

Compensation: We have been compensated up to $35,000 for this publication by DesignIRFirm.

This morning prior to the market open someone sent me a link to http://www.penny-mailers.com/mailers/DPHS_mailer_3rdjune.jpg using my contact form to report that they received a hard mailer on DPHS. I was immediately suspicious, especially after seeing that the website that image was hosted on was just registered on May 22nd. Furthermore, a look in the directory showed many different file names for the same image:
dphs_directory - Copy (2)

Also, the font was off in some places — the “x” in “next” was weird and the “u” in “huge” was in italics while the rest of the word was not.

next_huge

I tweeted my suspicions prior to the market open:

I took to Twitter to see what else people were saying and found this:

The purported mailer of DPHS looked a lot like the LOTE mailer. I became convinced that the purported hard mailer was fake. Tim Lento then posted in the TimAlerts chat that

TimLento

DPHS LOTE check it out, creases exactly the same and black marks on top and bottom http://bit.ly/11mjKzc http://bit.ly/11mjL6e

Posted Jun 03, 10:24 AM

 

The fold marks were the exact same as those in the LOTE hard mailer that Tim Lento had uploaded over a month ago; the purported DPHS mailer was just a Photoshopped version of the LOTE mailer. Here is a close-up that proves the DPHS mailer is a fake (see the zoomed-out comparison):

dphs_close - Copy (2)

 

Even without the original LOTE image to compare the DPHS image to, it would still be possible to ascertain that the DPHS image was faked, by using image error level analysis. Take a look for yourself.

Here is a small piece of the DPHS image:

dphs_ilea

The lighter areas show a different level of image error compared to the darker errors, indicating that they came from different sources. Different colors in the original will affect the image error level analysis so it is only in sections of the same color and font where differences in the error level image are meaningful.

How I will trade DPHS

Fake stock promotions consistently do much worse than even real stock promotions, so I am short biased on DPHS. That being said, there is bid support on the stock that has gotten partially filled (the bids were not pulled when they were about to be tested) which means that someone is trying to support this and not just sell as much stock as possible as quickly as possible. Consequently, I will not look to short this aggressively. But I still won’t even consider buying it.

[Edit 2013-6-3 8:00pm EST]: Multiple people have posted photos of a real hard mailer that hit today promoting DPHS. But even this mailer, while real, is still fake, because it says that it is from AwesomePennyStocks and that they will promote DPHS to their email list on Thursday. Here is a photo that was posted to iHub. I am quite certain that this is not from AwesomePennyStocks (APS) or anyone affiliated with them. They have continued to email promoting XUII. I have taken advantage of the confusion though by selling short XUII overnight and holding DPHS long overnight (both positions will likely be closed soon after the open tomorrow). The mailer directs people to www.pre-mailer-alerts.com which was registered on April 25th, has a design very much like APS’ website Premiumstockreport.com, and was registered to Maria Morales of Costa Rica. APS’ current legal entity is Degroupa Tenner Morales Media. I think it quite likely that someone is having quite a bit of fun pretending to be APS.

[Edit 2013-6-4 8am]: I am wondering if the new APS mailer was even sent out in the mail. I would expect more people to have received it if it had been sent. Maybe it is another fake.
dphs1

 [Edit 2013-6-13]: The real hard mailer sent out promoting DPHS (from here):

dphs

Disclaimer: [Edit 2013-6-3 8pm EST – I am long DPHS and am short XUII shares; both positions will likely be closed early tomorrow morning.] I have no position in any stock mentioned and I have no relationship with any parties mentioned above. This blog has a terms of use that is incorporated by reference into this post; you can find all my disclaimers and disclosures there as well.

Yappn Corp (OTCBB: YPPN) fake pump and dump

What is an even better sign of an impending collapse in stock price than a pump and dump? A fake pump and dump! There are enough traders that buy pump and dumps that a large shareholder in a company, rather than paying big money for a large hard mailer campaign or paying a bunch of email promoters to promote their stock, can simply pretend to have spent big money on a stock promotion and then leak news of the stock promotion to traders on message boards, on Twitter, and in chatrooms. This is what appears to have happened with Be Active Holdings (JALA) back in March. See my blog post on that promotion, which purportedly had a $2.5 million budget but was almost certainly overstated; I was dubious at the time and recommended against buying the stock. While JALA had two nice up days it soon dumped hard and left many with huge losses. I never saw evidence of any hard mailers sent out promoting the stock.

jala

 

Yappn Corp (OTCBB: YPPN) appears to be much the same but it looks like whomever put it together has put even less effort into it.  The pump page is not very long at all and it appears that little work was put into it. The disclaimer is similar:

CAC plans on spending a production budget of up to $2, 150, 000 on postage, printing, publishing, and marketing for the benefit of advertising Yappn Corp. through direct mail and on the internet. The officers and directors of CAC are currently holding six million three hundred thirty five thouand shares of YPPN common stock and reserve the right to buy more or sell these shares without prior notice.

Note that it doesn’t state that they have spent $2.15 million, only that they ‘plan’ to spend that much. I would be surprised if they spent more than $10,000 or so total, with all of that paying for the pump website. The market cap of Yappn is already insane so I believe this stock will go almost straight down. I would call this perhaps the best short opportunity of the year. Unfortunately I have not yet found shares to short.

Promoter: Catalina Advertising Corporation
Paying party: ??

Shares outstanding: 142,500,000
Previous closing price: $0.75
Market capitalization: $106 million

yppn

 

Full disclaimer:

Important Disclaimer and Disclosure: YPPNReport.com is a newsletter service of Catalina Advertising Corporation (CAC). (CAC) is not a registered financial advisory. The information presented here is not an offer to buy or sell securities, it is solely meant to be an advertisement for Yappn Corp. CAC does not guarantee as to the accuracy of the information in this newsletter, it was taking entirely from public sources. Penny Stocks are considered to be highly speculative and may be unsuitable for all but very aggressive investors. CAC plans on spending a production budget of up to $2, 150, 000 on postage, printing, publishing, and marketing for the benefit of advertising Yappn Corp. through direct mail and on the internet. The officers and directors of CAC are currently holding six million three hundred thirty five thouand shares of YPPN common stock and reserve the right to buy more or sell these shares without prior notice. Investors should also be aware that this will affect the stock price. This report does not provide any analysis of the company’s financial position. The featured company’s financial position and all other information regarding the featured company should be verified directly with the company. The target price was based on an assumption of one percent of facebook’s market cap success, please always consult a registered financial advisor before making any stock purchase decisions.

PDF copy of pump page.

[Edit 2013-6-3]: I saw a search ad linking to YPPNReport.com on Yahoo:

yppn

Disclaimer: I have no position in any stock mentioned and I have no relationship with any parties mentioned above. This blog has a terms of use that is incorporated by reference into this post; you can find all my disclaimers and disclosures there as well.

Centor Inc. $CNTO pump and dump

Thanks to Tim Lento for finding the landing page at CNTOReport.com and tweeting about it.  Judging by the volume and the lack of emails promoting it, I guess that it has not yet been promoted and most of the volume is either wash trading or pre-promotion speculators.

[Edit 2013-6-10]: I see now that I first received emails promoting CNTO on 5/29 from info@wallstreetbuzz.com and since then every few days I have received new emails from another crappy stock promoter.

Disclosed budget: $300,000

Promoter: James DiGeorgia and ??

Paying party: Fan Fan Media

Shares outstanding:  72,135,000
Previous closing price: $1.05
Market capitalization: $72 million

CNTO

Excerpt from disclaimer:

Centor Resources. (hereafter “CNTO”), the company featured in this issue, appears as paid advertising, Fan Fan Media has paid $300,000 to enhance public awareness for CNTO. Fan Fan owns shares in CNTO and may sell these shares at any time.

JamesDiGeorgia has received a $5,000 fee for this advertising effort.

 

cntochart

Disclaimer:

IMPORTANT NOTICE AND DISCLAIMER: This paid email advertisement by the Gold and Energy Advisor does not purport to provide an analysis of any company’s financial position, operations, or prospects and this is not to be construed as a recommendation by Gold and Energy Advisor, or an offer to sell or solicitation to buy or sell any security. Centor Resources. (hereafter “CNTO”), the company featured in this issue, appears as paid advertising, Fan Fan Media has paid $300,000 to enhance public awareness for CNTO. Fan Fan owns shares in CNTO and may sell these shares at any time. Although the information contained in this advertisement is believed to be reliable, Gold and Energy Advisor makes no warranties as to the accuracy of any of the content herein and accepts no liability for how readers may choose to utilize it. The information contained herein is based exclusively on information generally available to the public and does not contain any material, nonpublic information. Readers should perform their own duediligence before investing in any security including consulting with a qualified investment advisor or analyst. Readers should independently verify all statements made in this advertisement and perform extensive duediligence on this or any other advertised company. JamesDiGeorgia has received a $5,000 fee for this advertising effort. SuperStockInvestor. com also expects to receive new subscriber revenue, the amount which is unknown at this time, as a result of this advertising effort. James DiGeorgia and Gold and Energy Advisor nor any of their principals, officers,directors, partners, agents, or affiliates are not, nor do we represent ourselves to be, registered investment advisors, brokers, or dealers in securities. Gold and Energy Advisor is not offering securities for sale. An offer to buy or sell can be made only with accompanying disclosure documents and only in the states and provinces for which they are approved. Research and any due diligence was conducted by an outside researcher for this advertisement. More information can be received from CNTO’S website at www.centorresources.com. Further, specific financial information, filings and disclosures as well as general investor information about publicly listed companies and other investor resources can be found at the Securities and Exchange Commission website at www.sec.gov and www.nasd.com. Any investment should be made only after consulting with a qualified investment advisor and only after reviewing the financial statements and other pertinent corporate information about the company. Many states have established rules requiring the approval of a security by a state security administrator. Check with www.nasaa.org or call your state security administrator to determine whether a particular security is licensed for sale in your state. This advertisement is not intended for readers in any jurisdiction where not permissible under local regulations and investors in those jurisdictions should disregard it. Investing in securities is highly speculative and carries a great deal of risk, which may result in investors losing all of their invested capital. Past performance does not guarantee future results. The information contained herein contains forward-looking statements and information within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including statements Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including statements featured company. Forwardl-ooking statements are based upon expectations, estimates and projections at the time the statements are made and involve risks and uncertainties that could cause actual events to differ materially from those anticipated. Forward-looking statements may be identified through the use of words such as expects, will, anticipates, estimates, believes, or by statements indicating certain actions may, could, should, or might occur. Any statements that express or involve predictions, expectations, beliefs, plans, projections, objectives, goals or future events or performance may be forwardlooking statements. In accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, the publisher notes that statements contained herein that look forward in time, which include other than historical information, involve risks and uncertainties that may affect the company’s actual results of operations. Factors that could cause actual results to differ include, but are not limited to, the size and growth of the market for the company’s products and services, regulatory approvals, the company’s ability to fund its capital requirements in the near term and the long term, pricing pressures and other risks detailed in the company’s reports filed with the Securities and Exchange Commission.

PDF copy of stock promotion page.

 

Disclaimer: I have no position in any stock mentioned and I have no relationship with any parties mentioned above. This blog has a terms of use that is incorporated by reference into this post; you can find all my disclaimers and disclosures there as well.

Northumberland Resources $NHUR pump and dump

Unlike many pumps I cannot identify with certainty when the pump actually started. And I have been aware of this being an active stock promotion for weeks but did not blog about it out of respect for Tom McCarthy of Prepromotion Stocks who I follow and without whom I would not have learned about NHUR and its stock promotion until recently. The first time I saw Tom mention NHUR was back on March 8th (and he mentioned it in a webinar back in February). He later emphasized the favorable risk/reward profile of buying a breakout in April.

NHUR is being promoted by BillionaireStocks.com (see PDF report) and also by Financier Times. Both websites disclose the same compensation and ownership by PubCapital Inc.

Disclosed budget: $3,000,000

Promoter: BillionaireStocks.com / FinancierTimes.com / PubCapital Inc.

Paying party: Not disclosed

Shares outstanding:  62,449,003 (and 809,400 preferred shares each convertible into 100 common shares)
Previous closing price: $1.60
Market capitalization: $100 million ($229 million after accounting for preferred shares)

nhur_financiaer_times

 

Excerpt from Financier Times disclaimer:

A three million dollar investor relations budget is being managed by PubCapital Inc. Any funds leftover [sic] after expenses for research, overhead, advertising and public relations related to Northumberland Resources will be considered profit.

Excerpt from Billionaire Stocks disclaimer:

Compensation: A three million dollar investor relations budget is being managed by PubCapital Inc. Any funds leftover after expenses for research, overhead, advertising and public relations related to Northumberland Resources (NHUR) will be considered profit.

Finacier Times Disclaimer:

financiertimes_nhur

Billionaire Stocks Disclaimer (from http://billionairestocks.com/disclaimer_more.html):

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This report/release/advertisement is a commercial advertisement and is for general information purposes only. We are engaged in the business of marketing and advertising companies for monetary compensation. Never invest in any stock featured on our site or emails unless you can afford to lose your entire investment. It is possible that a viewers’ entire investment may be lost or impaired due to the speculative nature of the companies profiled. Remember, never invest in any security of a company profiled or discussed on this website unless you can afford to lose your entire investment. Also, investing in small-cap and micro-cap securities is highly speculative and carries an extremely high degree of risk. This newsletter makes no recommendation that the securities of the companies profiled or discussed on this website should be purchased, sold or held by viewers that learn of the profiled companies through our website. Compensation: A three million dollar investor relations budget is being managed by PubCapital Inc. Any funds leftover after expenses for research, overhead, advertising and public relations related to Northumberland Resources (NHUR) will be considered profit. PubCapital Inc and/or entities related to PubCapital Inc hold a large amount of shares in NHUR and intend to sell those shares. Ours and their sales of NHUR common stock will affect the value of your shares (negatively). This should be considered a direct conflict of interest. Please review all investment decisions with a licensed investment advisor.

PDF copy of Financier Times pump page.

 

Disclaimer: I have no position in any stock mentioned and I have no relationship with any parties mentioned above. This blog has a terms of use that is incorporated by reference into this post; you can find all my disclaimers and disclosures there as well.

Montalvo Spirits (OTCBB: TQLA) pump and dump

This morning at 8:14am I received an email from Insiderwealthalert.com promoting Montalvo Spirits (OTCBB: TQLA). The email linked to the pump landing page http://www.tqlareport.com/tqla_landing.html

Disclosed budget: $380,000

[Edit 2013-6-26]: budget increased to $980,000

Promoter: Andrew Carpenter / Wall Street Revelator & Full Service Media LLC

Paying party: Belmont Media Group

Shares outstanding: 66,900,012
Previous closing price: $0.83
Market capitalization: $55 million

Excerpts from disclaimers:

To Date Andrew Carpenter has received $15,000 for the endorsement of this and expects to receive new subscriber revenue as a result of this advertising effort.

Belmont Media Group, Inc., the third party advertiser, has paid $380,000 USD to Full Service Media, LLC (FSM) as of May 16, 2013 for this advertising effort in an effort to build investor awareness.

tqla

 

Andrew Carpenter / Wall Street Revelator Disclaimer:

ANDREW CARPENTER’S WALL STREET REVELATOR NEWSLETTER IMPORTANT NOTICE AND DISCLAIMER: Andrew Carpenter (Endorser) track record was compiled from calculations derived from documentation of his trading strategies. No representation is made that actual purchases and sales were made at the prices stated. Facts stated in this article were supplied to endorser from third-party sources. Endorser makes no representations as to such facts, reliability, accuracy or completeness. Endorser is not responsible for errors or omissions. Endorser does not claim any special expertise or knowledge regarding the lighting technology industry. Endorser is neither acting as an investment advisor nor providing individual investment advice. Andrew Carpenter and The Wall Street Revelator Newsletter OWNS NO SHARES, OPTIONS, WARRANTS in Montalvo Spirits, Inc. (TQLA). Also, Montalvo Spirits, Inc. has neither approved nor paid for this specific advertisement. Readers should perform their own due diligence. The information presented is provided for information purposes only and the endorsement is not to be used or considered as an offer or the solicitation of an offer to sell or to buy or subscribe for securities. Endorser has not taken any steps to ensure that the securities referred to in this report are suitable for any particular investor. Any securities referenced by Endorser may not be suitable for you and it is recommended that you consult an independent investment advisor if you are in doubt about such investments. Nothing in the endorsement constitutes investment, legal, accounting or tax advice or a representation that any investment or strategy is suitable or appropriate to your individual circumstances or otherwise constitutes a personal recommendation to you. Information, opinions and estimates referenced in the endorsement reflect a judgment at its original date of publication and are subject to change without notice. The price and value of the securities mentioned in the endorsement can fall as well as rise, and may have a high level of volatility. High volatility securities may experience sudden and large falls in their value, leading to losses. High volatility investments may also be difficult to sell. Similarly, it may prove difficult for you to obtain reliable information about the value or risks to which such an investment is exposed. The endorsement may provide the addresses of, or contain hyperlinks to, websites. Except to the extent to which the report refers to website material of Endorser, the Endorser has not reviewed any recommended or linked site and takes no responsibility for the content contained therein. Such address or hyperlink is provided solely for your convenience and information and the content of the linked site does not in any way form part of the endorsement. Accessing such websites or following any link shall be at your own risk. Further, you are advised to read and carefully consider the additional explanations of risk factors in Montalvo Spirits, Inc. SEC filings that can be found online in the SEC EDGAR database at www.SEC.gov. Neither Andrew Carpenter nor his publication is offering securities for sale. To Date Andrew Carpenter has received $15,000 for the endorsement of this and expects to receive new subscriber revenue as a result of this advertising effort. Finally, penny stocks are EXTREMELY RISKY. You should consult with your registered investment adviser before investing to determine suitability and risk tolerance. Andrew Carpenter and The Wall Street Revelator newsletter assume no risk for investor losses or profits. The information contained herein contains forward-looking information within the meaning of Section 27a of the Securities Act of 1933, as amended, and section 21e of the Securities Exchange Act of 1934, as amended, including statements regarding expected growth of the featured company. In accordance with the safe harbor provisions of the Private Securities Litigation Reform Act, statements contained herein that look forward in time, which include everything other than historical information, involve risks and uncertainties that may affect Montalvo Spirits, Inc. actual results of operations. IMPORTANT NOTICE! Option and stock investing involves risk and is not suitable for all investors. Only invest money you can afford to lose in stocks and options. Past performance does not guarantee future results. The trade entry represents the price of the security at the time the trade recommendation was made and the trade exit represents the price of the security at the time the trade recommendation was made. The Wall Street Revelator Newsletter trade record does not represent actual investment results. Trade examples are simulated and have certain limitations. Simulated results do not represent actual trading. Since the trades may not have been executed, the results may have under or over compensated for the impact, if any, of certain market factors such as lack of liquidity. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown.

Full Service Media Disclaimer:

Third Party Advertiser/Advertising Agency IMPORTANT NOTICE AND DISCLAIMER: Belmont Media Group, Inc., the third party advertiser, has paid $380,000 USD to Full Service Media, LLC (FSM) as of May 16, 2013 for this advertising effort in an effort to build investor awareness. FSM shall retain any amounts over and above the cost of creating and distributing this email advertisement which advertises Andrew Carpenter’s Wall Street Revelator Newsletter coverage of Montalvo Spirits, Inc., Advertising services include; production, outsourced advertising copywriting services, mailing and other related distribution services and advertising media placement costs. Belmont Media Group, Inc., the third party advertiser, is a company based in Charlestown Nevis. Belmont Media Group, Inc., the third party advertiser, has represented to FSM in writing that it is not a current shareholder of Montalvo Spirits, Inc. and that neither it nor its affiliates will buy or sell any shares of Montalvo Spirits, Inc. during the period that this advertisement is being disseminated by FSM third party media vendors. This is sponsored advertising and does not purport to provide an analysis of the featured company’s financial position, operations or prospects and is not to be construed as a recommendation or solicitation by FSM to buy or sell any security. FSM is a firm which refers and facilitates the services of third-party vendors and advertising related service providers to persons wishing to sponsor advertising featuring publicly-traded companies. FSM is not a financial analyst, investment advisor or broker/dealer. The services provided by FSM in connection with this advertisement are limited to the introduction of third party advertiser to copywriter services and paid endorser, the renting of distribution list(s), and managing the production and distribution of this advertisement. FSM is not responsible for the endorsement of this advertisement, which is the sole responsibility of Andrew Carpenter’s Wall Street Revelator Newsletter. Andrew Carpenter’s Wall Street Revelator Newsletter expects to generate new subscriber revenue as a result of this advertising effort. Neither FSM nor its members have an ownership interest in Andrew Carpenter’s Wall Street Revelator Newsletter or any of its affiliates, and neither Andrew Carpenter’s Wall Street Revelator Newsletter nor its affiliates have an equity interest in FSM. Neither FSM nor its members will trade in the securities of Montalvo Spirits, Inc. FSM makes no warranties as to the accuracy of the content of this advertisement and expressly disclaims and assumes no liability for how readers may choose to utilize the content of this advertisement. Readers are strongly urged to independently verify all statements made in this advertisement and to perform their own due diligence on this or any other advertised company, including but not limited to consulting with a qualified investment professional and reviewing the publicly available financial statements of, and other information about Montalvo Spirits, Inc. You should also determine that an investment in Montalvo Spirits, Inc. company is appropriate and suitable for you. Montalvo Spirits, Inc. is traded on the OTCQB (trading symbol: TQLA). Its stock is registered under the Securities Act of 1933, as amended, and its periodic and other reports filed under the Securities Exchange Act of 1934, as amended, are publicly available from the Securities and Exchange Commission at its website at http://www.sec.gov. This website also contains general investor information about publicly-traded companies, advice to investors and other investor resources. Other investor resources are available from the Financial Industry Regulatory Authority through its website at http://www.finra.org. Many states have established rules requiring approval by the state securities administrator to permit sales of a security to its residents. Check with the North American Securities Administrators Association through its website at http://www.nasaa.org or call your state securities administrator to determine whether a particular security may be purchased by you as a resident of your state. Many companies have filed information with state securities regulators and many companies will supply prospective investors with additional information upon request. Investing in securities is highly speculative and carries a great deal of risk, especially as to newer companies with comparatively short operating histories and limited earnings This advertisement contains forward-looking statements regarding Montalvo Spirits, Inc. its business and prospects. Such forward-looking statements are within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbor provisions created by these laws. This advertisement may provide the addresses of or contain hyperlinks to outside or third-party websites, FSM has not reviewed any such websites and takes no responsibility for the contents thereof or any possible effects resulting from accessing any such websites. The contents of any such websites do not in any way constitute a part of this advertisement. Accessing such websites or following any link shall be at your own risk.

PDF copy of pump page.

[Update 2013-6-26]: Updated disclosure:

NDREW CARPENTER’S WALL STREET REVELATOR NEWSLETTER IMPORTANT NOTICE AND DISCLAIMER: Andrew Carpenter (Endorser) track record was compiled from calculations derived from documentation of his trading strategies. No representation is made that actual purchases and sales were made at the prices stated. Facts stated in this article were supplied to endorser from third-party sources. Endorser makes no representations as to such facts, reliability, accuracy or completeness. Endorser is not responsible for errors or omissions. Endorser does not claim any special expertise or knowledge regarding the lighting technology industry. Endorser is neither acting as an investment advisor nor providing individual investment advice. Andrew Carpenter and The Wall Street Revelator Newsletter OWNS NO SHARES, OPTIONS, WARRANTS in Montalvo Spirits, Inc. (TQLA). Also, Montalvo Spirits, Inc. has neither approved nor paid for this specific advertisement. Readers should perform their own due diligence. The information presented is provided for information purposes only and the endorsement is not to be used or considered as an offer or the solicitation of an offer to sell or to buy or subscribe for securities. Endorser has not taken any steps to ensure that the securities referred to in this report are suitable for any particular investor. Any securities referenced by Endorser may not be suitable for you and it is recommended that you consult an independent investment advisor if you are in doubt about such investments. Nothing in the endorsement constitutes investment, legal, accounting or tax advice or a representation that any investment or strategy is suitable or appropriate to your individual circumstances or otherwise constitutes a personal recommendation to you. Information, opinions and estimates referenced in the endorsement reflect a judgment at its original date of publication and are subject to change without notice. The price and value of the securities mentioned in the endorsement can fall as well as rise, and may have a high level of volatility. High volatility securities may experience sudden and large falls in their value, leading to losses. High volatility investments may also be difficult to sell. Similarly, it may prove difficult for you to obtain reliable information about the value or risks to which such an investment is exposed. The endorsement may provide the addresses of, or contain hyperlinks to, websites. Except to the extent to which the report refers to website material of Endorser, the Endorser has not reviewed any recommended or linked site and takes no responsibility for the content contained therein. Such address or hyperlink is provided solely for your convenience and information and the content of the linked site does not in any way form part of the endorsement. Accessing such websites or following any link shall be at your own risk. Further, you are advised to read and carefully consider the additional explanations of risk factors in Montalvo Spirits, Inc. SEC filings that can be found online in the SEC EDGAR database at www.SEC.gov. Neither Andrew Carpenter nor his publication is offering securities for sale. To Date Andrew Carpenter has received $15,000 for the endorsement of this and expects to receive new subscriber revenue as a result of this advertising effort. Finally, penny stocks are EXTREMELY RISKY. You should consult with your registered investment adviser before investing to determine suitability and risk tolerance. Andrew Carpenter and The Wall Street Revelator newsletter assume no risk for investor losses or profits. The information contained herein contains forward-looking information within the meaning of Section 27a of the Securities Act of 1933, as amended, and section 21e of the Securities Exchange Act of 1934, as amended, including statements regarding expected growth of the featured company. In accordance with the safe harbor provisions of the Private Securities Litigation Reform Act, statements contained herein that look forward in time, which include everything other than historical information, involve risks and uncertainties that may affect Montalvo Spirits, Inc. actual results of operations. IMPORTANT NOTICE! Option and stock investing involves risk and is not suitable for all investors. Only invest money you can afford to lose in stocks and options. Past performance does not guarantee future results. The trade entry represents the price of the security at the time the trade recommendation was made and the trade exit represents the price of the security at the time the trade recommendation was made. The Wall Street Revelator Newsletter trade record does not represent actual investment results. Trade examples are simulated and have certain limitations. Simulated results do not represent actual trading. Since the trades may not have been executed, the results may have under or over compensated for the impact, if any, of certain market factors such as lack of liquidity. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown.

Third Party Advertiser/Advertising Agency IMPORTANT NOTICE AND DISCLAIMER: Belmont Media Group, Inc., the third party advertiser, has paid $380,000 USD and is expecting an additional $600,000 USD to Full Service Media, LLC (FSM) as of May 20, 2013 for this advertising effort in an effort to build investor awareness. FSM shall retain any amounts over and above the cost of creating and distributing this email advertisement which advertises Andrew Carpenter’s Wall Street Revelator Newsletter coverage of Montalvo Spirits, Inc., Advertising services include; production, outsourced advertising copywriting services, mailing and other related distribution services and advertising media placement costs. Belmont Media Group, Inc., the third party advertiser, is a company based in Charlestown Nevis. Belmont Media Group, Inc., the third party advertiser, has represented to FSM in writing that it is not a current shareholder of Montalvo Spirits, Inc. and that neither it nor its affiliates will buy or sell any shares of Montalvo Spirits, Inc. during the period that this advertisement is being disseminated by FSM third party media vendors. This is sponsored advertising and does not purport to provide an analysis of the featured company’s financial position, operations or prospects and is not to be construed as a recommendation or solicitation by FSM to buy or sell any security. FSM is a firm which refers and facilitates the services of third-party vendors and advertising related service providers to persons wishing to sponsor advertising featuring publicly-traded companies. FSM is not a financial analyst, investment advisor or broker/dealer. The services provided by FSM in connection with this advertisement are limited to the introduction of third party advertiser to copywriter services and paid endorser, the renting of distribution list(s), and managing the production and distribution of this advertisement. FSM is not responsible for the endorsement of this advertisement, which is the sole responsibility of Andrew Carpenter’s Wall Street Revelator Newsletter. Andrew Carpenter’s Wall Street Revelator Newsletter expects to generate new subscriber revenue as a result of this advertising effort. Neither FSM nor its members have an ownership interest in Andrew Carpenter’s Wall Street Revelator Newsletter or any of its affiliates, and neither Andrew Carpenter’s Wall Street Revelator Newsletter nor its affiliates have an equity interest in FSM. Neither FSM nor its members will trade in the securities of Montalvo Spirits, Inc. FSM makes no warranties as to the accuracy of the content of this advertisement and expressly disclaims and assumes no liability for how readers may choose to utilize the content of this advertisement. Readers are strongly urged to independently verify all statements made in this advertisement and to perform their own due diligence on this or any other advertised company, including but not limited to consulting with a qualified investment professional and reviewing the publicly available financial statements of, and other information about Montalvo Spirits, Inc. You should also determine that an investment in Montalvo Spirits, Inc. company is appropriate and suitable for you. Montalvo Spirits, Inc. is traded on the OTCQB (trading symbol: TQLA). Its stock is registered under the Securities Act of 1933, as amended, and its periodic and other reports filed under the Securities Exchange Act of 1934, as amended, are publicly available from the Securities and Exchange Commission at its website at http://www.sec.gov. This website also contains general investor information about publicly-traded companies, advice to investors and other investor resources. Other investor resources are available from the Financial Industry Regulatory Authority through its website at http://www.finra.org. Many states have established rules requiring approval by the state securities administrator to permit sales of a security to its residents. Check with the North American Securities Administrators Association through its website at http://www.nasaa.org or call your state securities administrator to determine whether a particular security may be purchased by you as a resident of your state. Many companies have filed information with state securities regulators and many companies will supply prospective investors with additional information upon request. Investing in securities is highly speculative and carries a great deal of risk, especially as to newer companies with comparatively short operating histories and limited earnings This advertisement contains forward-looking statements regarding Montalvo Spirits, Inc. its business and prospects. Such forward-looking statements are within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbor provisions created by these laws. This advertisement may provide the addresses of or contain hyperlinks to outside or third-party websites, FSM has not reviewed any such websites and takes no responsibility for the contents thereof or any possible effects resulting from accessing any such websites. The contents of any such websites do not in any way constitute a part of this advertisement. Accessing such websites or following any link shall be at your own risk.

 

Disclaimer: [Update 2013-6-26: I am short 11,890 shares of TQLA.]  I have no position in any stock mentioned and I have no relationship with any parties mentioned above. This blog has a terms of use that is incorporated by reference into this post; you can find all my disclaimers and disclosures there as well.

Brazil Minerals (OTCBB: BMIX) Tobin Smith hard mailer pump and dump

Yesterday during the trading day I saw a subscriber of Tom McCarthy’s Prepromotion Stocks service alert in chat that he had received a hard mailer from Tobin Smith promoting Brazil Minerals (OTCBB: BMIX).

gdot123

Wife just texted me..got hard mailer for BMIX from NBT Equities…Tobin Smith

Posted May 15, 3:00 PM

I bought 7,500 shares at $0.724 and I still hold those shares (I will sell them soon, possibly as soon as tomorrow’s open). After the market close a TimAlerts subscriber reported that he had also received the mailer. I tweeted about that and a few minutes after I tweeted, Peter Pan (a popular penny stock trader on Twitter that I do not follow) tweeted that he had received the mailer and he uploaded a picture:bmix (1)

As of the time I post this I have not seen anyone post a picture of the disclaimer, although multiple people have said that the budget is disclosed as $1.6m (of course all promotion budgets should be taken with a few kilos of salt).

Disclosed budget: $1,600,000

Promoter: NBT Equities Research / Tobin Smith

Paying party: ???

Shares outstanding: 69,963,463
Previous closing price: $0.87
Market capitalization: $60 million

 

Interestingly, Tobin Smith first promoted BMIX back on May 6th via email and on his website at http://www.nbtequitiesresearch.com/sites/default/files/uploads/InitiatingCoverageBrazilMinerals1.pdf but the stock did not get much volume until yesterday.

NBT Equities / Tobin Smith Disclaimer excerpt:

NBT Equities Research has received $40,000 compensation from LB Ventures, a third party shareholder for coverage.

 

bmix

 

Disclaimer: I am long 7500 shares of BMIX that I intend to sell within the next day or two; I have no relationship with any parties mentioned above. This blog has a terms of use that is incorporated by reference into this post; you can find all my disclaimers and disclosures there as well.

iTalk (OTCBB: TALK) pump and dump from the folks who brought you GNIN

The Brighton Markets group of websites sent out teaser emails about their new pump coming up after the close yesterday, giving away their promotion of TALK in the disclaimer. Thanks to Tim Lento for noticing that first.

Their most recent pump, and by far their longest-lasting and most successful, was GNIN. I previously wrote about that stock promotion (in that blog post I also link all their websites that I am familiar with). I also made a bunch of money trading it, as shown by the two trades below (I had a lot of other trades but essentially all of my gains are shown by the two trades below; contrary to what the trades indicate, I made most of my money shorting; I had shorted early and boxed my shares however, which is why most of my profit appears to come from a long).

 

$2,685profitGNINShort Stock
IB batch import through 3/10

Posted by MichaelGoode /
http://profit.ly/1MnOPP

 

$11,161profitGNINLong Stock
Speedtrader batch import through 3/10/2013

Posted by MichaelGoode /
http://profit.ly/1MnOOb

gnin

As you can see from the chart, the Green Innovations (GNIN) promotion lasted a long time and the promoters got a big second spike after the first dump. iTalk (TALK) has been a far different promotion with far higher volume initially, presumably from people buying in response to calls from the boiler rooms connected with Brighton Markets. The steep ascent and high volume is also likely due partly to the hot pump market and partly to the success of GNIN. I think it likely that TALK will never get close to GNIN’s highs because of the higher volume at the beginning of the pump. Also, short sellers who were squeezed on GNIN will be more cautious shorting TALK, reducing the chances of a short squeeze.

talk

 

The promotion of TALK by the websites associated with Brighton Markets has not even formally begun (although as I noted above, the pump started over a week ago, likely starting with calls from boiler rooms). But in the teaser emails sent out Friday night the disclaimer clearly states that they are promoting TALK. The disclaimer in the form of an image is even named “TALK_disclaimer”

talk_disclaimerIf you can’t read the fine print, see the full disclaimer at http://investors-alliance.com/edis/talk_disclaimer.php

Excerpt from disclaimer:

Please be advised that investors-alliance.com has been paid $40,000 USD per week by Crystal Financial LLC to send this alert on TALK to perform promotional and advertising services.

Promotion budget: $40,000 per week
Paying party: Crystal Financial LLC

Shares outstanding: 42,500,000
Market cap (as of 5/3/2013): $48.5 million

How will I trade this? I will consider buying it Monday but if I did that I would not hold past Tuesday. The GNIN pump’s high was the day it was finally promoted by all the older Brighton websites, so I will be looking to short once they start promoting TALK via emails.

[Edit 2013-5-28]: I came across an online pump page a week or two ago on TALK as well. It is at http://italkreport.com/

Disclaimer (emphasis mine):

IMPORTANT NOTICE AND DISCLAIMER: This advertising issue of Profit Seeker Online does not purport to provide an analysis of any company’s financial position, operations or prospects and this is not to be construed as a recommendation by Profit Seeker Online or an offer or solicitation to buy or sell any security. iTalk, (TALK), the company featured in this issue, appears as paid advertising by Crystal Financial, LLC to provide public awareness for TALK for the period of May 24, 2013 through June 24, 2013. Profit Seeker Online and Nextor Media Corp. have used outside research and writers using public information to create the advertisement coming from Profit Seeker Online about TALK. Although the information contained in this advertisement is believed to be reliable, Profit Seeker Online and Nextor Media Corp. make no warranties as to the accuracy of any of the content herein and accepts no liability for how readers may choose to utilize the content. Readers should perform their own due-diligence, including consulting with a licensed, qualified investment professional or analyst. Further, readers are strongly urged to independently verify all statements made in this advertisement and perform extensive due diligence on this or any other advertised company. Profit Seeker Online is not offering securities for sale. An offer to buy or sell can be made only with accompanying disclosure documents and only in the states and provinces for which they are approved. Many states have established rules requiring the approval of a security by a state security administrator. Check with http://www.nasaa.org or call your state security administrator to determine whether a particular security is licensed for sale in your state. Many companies have information filed with state securities regulators and many will supply investors with additional information on request. Nextor Media Corp. has managed a total production budget of up to $2,750,000 from Crystal Financial, LLC for advertising efforts starting May 24, 2013 until June 24, 2013 and will retain any amounts over and above the cost of production, copywriting services, mailing and other distribution expenses, as a fee for its services. Profit Seeker Online is paid $7,800 as an editorial fee from Nextor Media Corp. and also expects to receive new subscriber revenue as a result of this advertising effort. *More information can be received from TALK’s investor relations firm. Further, specific financial information, filings and disclosures as well as general investor information about publicly traded companies like TALK, advice to investors and other investor resources are available at the Securities and Exchange Commission website www.sec.gov and www.nasd.com. Any investment should be made only after consulting with a qualified investment advisor and after reviewing the publicly available financial statements of and other information about the company and verifying that the investment is appropriate and suitable. Investing in securities is highly speculative and carries a great deal of risk especially as to new companies with limited operations and no history of earnings. The information contained herein contains forward-looking information within the meaning of section 27a of the Securities Act of 1993, as amended, and section 21e of the Securities Exchange Act of 1934, as amended, including statements regarding expected growth of the featured company. In accordance with the safe harbor provisions of the Private Securities Litigation Reform Act, TALK notes that statements contained herein that look forward in time, which include everything other than historical information, involve risks and uncertainties that may affect the Company’s actual results of operations. Factors that could cause actual results to differ include the size and growth of the market, the Company’s ability to fund its capital requirements in the near term and in the long term; pricing pressures, technology issues etc.

PDF copy of pump page.

That hasn’t helped the stock price:
TALK

 

Disclaimer: [Edit 2013-5-28 — No position] I have no net position in TALK; I am short 10,000 shares in one account and long 10,000 shares in another account. I may change my position at any time. I have no relationship with any parties mentioned above except that I did receive an anonymous threat to kill my wife and daughter, purportedly sent by these promoters but almost certainly not from them. This blog has a terms of use that is incorporated by reference into this post; you can find all my disclaimers and disclosures there as well.

 

Tungsten Corp (OTCBB: TUNG) pump and dump

Yesterday during the trading day I saw someone in the TimAlerts chat mention they had come across the online landing page promoting Tungsten Corp (OTCBB: TUNG); a link to that website had also been posted on iHub a few days ago. The budget on the website was initially listed as $900,000 but has since been increased. The website is http://tungstennow.com/

 

Disclosed budget: $2,250,000 [Edit 2013-5-6]: The budget in the disclaimer has been decreased again to $900,000 from $2,250,000
Promoter: Eric Dickson’s Breakaway Stocks and List Data Solution

Paying party: Westway International, LLC

Shares outstanding: 65,000,000
Previous closing price: $1.03
Market capitalization: $67 million

tung_screenshot

 

Excerpt from disclaimer:

Tungsten Corp, (TUNG), the company featured in this issue, appears as paid advertising byWestway International, LLC to provide public awareness for TUNG. Breakaway Stocks and List Data Solution (LDS) have used outside research andwriters using public information to create the advertisement coming fromBreakaway Stocks about TUNG.

LDS hasmanaged a total production budget of up to $2,250,000 for advertising efforts andwill retain any amounts over and above the cost of production, copywriting services,mailing and other distribution expenses, as a fee for its services. Breakaway Stocks is paid $5,000 as an editorial fee fromLDS and also expects to receive newsubscriber revenue as a result of this advertising effort.

Full disclaimer:

IMPORTANTNOTICE AND DISCLAIMER: This advertising issue of Breakaway Stocks does not purport to provide an analysis of any company’s financial position, operations or prospects and this is not to be construed as a recommendation by Breakaway Stocks or an offer or solicitation to buy or sell any security. Tungsten Corp, (TUNG), the company featured in this issue, appears as paid advertising byWestway International, LLC to provide public awareness for TUNG. Breakaway Stocks and List Data Solution (LDS) have used outside research andwriters using public information to create the advertisement coming fromBreakaway Stocks about TUNG. Although the information contained in this advertisement is believed to be reliable, Breakaway Stocks and LDSmakes nowarranties as to the accuracy of any of the content herein and accepts no liability for howreadersmay choose to utilize the content.Readers should performtheir own due-diligence, including consultingwith a licensed, qualified investment professional or analyst. Further, readers are strongly urged to independently verify all statementsmade in this advertisement and performextensive due diligence on this or any other advertised company. Breakaway Stocks is not offering securities for sale. An offer to buy or sell can bemade onlywith accompanying disclosure documents and only in the states and provinces forwhich they are approved.Many states have established rules requiring the approval of a security by a state security administrator. Checkwith http://www.nasaa.org or call your state security administrator to determinewhether a particular security is licensed for sale in your state. Many companies have information filedwith state securities regulators andmanywill supply investorswith additional information on request. LDS hasmanaged a total production budget of up to $2,250,000 for advertising efforts andwill retain any amounts over and above the cost of production, copywriting services,mailing and other distribution expenses, as a fee for its services. Breakaway Stocks is paid $5,000 as an editorial fee fromLDS and also expects to receive newsubscriber revenue as a result of this advertising effort. *More information can be received fromTUNG’s investor relations firm. Further, specific financial information, filings and disclosures aswell as general investor information about publicly traded companies like TUNG, advice to investors and other investor resources are available at the Securities and Exchange Commissionwebsitewww.sec.gov andwww.nasd.com. Any investment should bemade only after consultingwith a qualified investment advisor and after reviewing the publicly available financial statements of and other information about the company and verifying that the investment is appropriate and suitable. Investing in securities is highly speculative and carries a great deal of risk especially as to newcompanieswith limited operations and no history of earnings. The information contained herein contains forward-looking Informationwithin themeaning of section 27a of the Securities Act of 1993, as amended, and section 21e of the Securities Exchange Act of 1934, as amended, including statements regarding expected growth of the featured company. In accordancewith the safe harbor provisions of the Private Securities LitigationReformAct, TUNGnotes that statements contained herein that look forward in time,which include everything other than historical information, involve risks and uncertainties thatmay affect the Company’s actual results of operations. Factors that could cause actual results to differ include the size and growth of themarket, the Company’s ability to fund its capital requirements in the near termand in the long term; pricing pressures, technology issues etc.

PDF copy of TUNG pump page.

[Edit 2013-5-13 3:30pm] Below are two photos taken of a hard mailer received by a TimAlerts subscriber this afternoon. While it is possible that he is a promoter and that no such mailers were sent, the images are not photoshopped (the EXIF data indicated the photos were taken by an iPhone 4s 12 minutes prior to me receiving them.

tung1b tung1a

Disclaimer: [Edit 2013-5-3 3:30pm: I am long 3,000 TUNG from $1.05. I may sell these shares at any time] I have no position in any stock mentioned above and no relationship with any parties mentioned above. This blog has a terms of use that is incorporated by reference into this post; you can find all my disclaimers and disclosures there as well.

Polar Petroleum Corp (OTCBB: POLR) pump and dump

Prior to the open today I received an email from Marketing@insiderwealthalert.com promoting POLR. The email linked to the website https://www.hardassetreport.com/landing/

One way to find out early about these online landing page pumps (many of which also have mailers) is to subscribe to a bunch of really crappy email pumpers: they will often rent their list for pumps like this. Insiderwealthalert.com’s disclaimer stated:

In accordance with Section 17(b) of the Securities Act of Nineteen Thirty Three, you are hereby advised that Eastman Communications, Inc. (ECI) is receiving a fee between $7,000 and $15,000, from an independent third party as compensation for the distribution of this advertisement

Considering the high price and market cap and low budget I will look to sell this short soon. The volume is very light for the moment, however.

Disclosed budget: $700,000 [Was listed as $250,000 when this was first posted and was increased at some point before 2013/5/8]
Promoter: Pond Research LLC aka Ken Williams’ Hard Asset Report

Paying party: Commodity United Ltd.

Shares outstanding: 42,952,500
Previous closing price: $2.00
Market capitalization: $85 million

polr

(click image to see full-sized)

 

Excerpt from disclaimer:

Commodity United Ltd. paid the publisher, Pond Research LLC, the sum of $700,000. This total production budget was applied towards costs associated with creating, printing and distributing this report. Excess funds remaining after production, if any, will be retained by the publisher as profit.

Hard Asset Report is a trademark of Pond Research LLC.

 

[Edit 2013-5-8]: I noticed a new landing page, at http://www.alaskanoilrush.com/landing/. Also, the disclaimer on both landing pages now discloses $700,000 in compensation. New disclaimer:

POLR_Disclaimer

 

 

Old disclaimer:

IMPORTANT NOTICE AND DISCLAIMER: This stock profile should be viewed as a paid advertisement. In order to enhance public awareness of Polar Petroleum and its securities through the distribution of this report, Commodity United Ltd. paid the publisher the sum of $250,000. This total production budget was applied towards costs associated with creating, printing and distributing this report. Excess funds remaining after production, if any, will be retained by the publisher as profit. This publication is not, and should not be construed to be, an offer to sell or a solicitation of an offer to buy any security. This publication, its publisher, and its editor do not purport to provide a complete analysis of any company’s financial position. The publisher and editor are not, and do not purport to be, broker-dealers or registered investment advisors. Any investment should be made only after consulting a professional investment advisor and only after reviewing the financial statements and other pertinent corporate information about the company. Investing in securities is speculative and carries a high degree of risk. Past performance does not guarantee future results. This publication is based exclusively on information generally available to the public and does not contain any material, non-public information. The information on which it is based is believed to be reliable. Nevertheless, the publisher cannot guarantee the accuracy or completeness of the information. This publication contains forward-looking statements, including statements regarding expected continual growth of the featured company and/or industry. The publisher notes that statements contained herein that look forward in time, which include everything other than historical information, involve risks and uncertainties that may affect the company’s actual results of operations. Factors that could cause actual results to differ include the size and growth of the market for the company’s products and services, the ultimate degree of success in drilling excursions, the company’s ability to fund its capital requirements in the near term and long term, pricing pressures, etc. Hard Asset Report is a trademarks of Commodity United Ltd. All other trademarks used in this publication are the property of their respective trademark holders. Pond Research, Hard Asset Report and Ken Williams are not affiliated, connected, or associated with, and are not sponsored, approved, or originated by, the trademark holders unless otherwise stated. No claim is made by Pond Research, Hard Asset Report or Ken Williams to any rights in any third-party trademarks.

PDF copy of old POLR pump page and new pump page.

[Edit 2013-5-13]: I found another new landing page with a higher compensation amount: https://www.hardassetreport.com/landing/

POLR_5132013

 

PDF of new landing page.

Disclaimer: [Edit 2013-5-13 -I am net long 40 shares of POLR. I may trade this at any time.] I have no position in any stock mentioned above and no relationship with any parties mentioned above. This blog has a terms of use that is incorporated by reference into this post; you can find all my disclaimers and disclosures there as well.

SEC subpoenas Andrew Farmer and Iridium Capital in connection with Chimera (CHMR) investigation

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.

 

Disclaimer: I have no position in any stock mentioned above and no relationship with any parties mentioned above. This blog has a terms of use that is incorporated by reference into this post; you can find all my disclaimers and disclosures there as well.