ElitePennyStock Paints target on its back: Best stock promoter out there

Disclosure: I’m short ElitePennyStock’s current promotion, AREN. See details at bottom.

In a world in which ever more promoters and manipulators have not just been sued by the SEC but sent to prison by US Department of Justice it is a dangerous thing to be known as the best stock promoter. But with Stocktips.com having spectacularly failed in their most recent pump (of Coastal Integrated Services, COLV), ElitePennyStock is now in my opinion the best promoter out there. As detailed in a blog post by Tim Grittani (use code NEXT100 to save on his DVD), ElitePennyStock (and I use this name to refer to the people that run all the related websites) has ties to AwesomePennyStocks. See also the Promotion Stock Secrets research report on ElitePennyStock.

The two most recent ElitePennyStock pumps were American Leisure Holdings (AMLH) in January and February, and Media Analytics (MEDA) in December 2014 and January 2015. The AMLH pump lasted for 19 days prior to the big drop in price (note that the promotion continued through February 17. The MEDA pump lasted for 10 days prior to the precipitous drop (the last pump emails I received for MEDA came on December 19th).

amlh

meda

So far the AREN (America Resources Exploration Inc) promotion is on day 17. I believe it very likely that the end of this pump is quite near. See the Promotion Stock Secrets report on AREN if you care to learn the details on the insiders in the company and how it was set up to be a promotion.

aren

Interestingly, AREN filed a form 12b-25 with the SEC just before the market close today, indicating that they will not be able to file their quarterly report on time. I wonder if that may be another indication that the pump will soon be over.

 

Compensation: [different in emails from the different websites]
Promoter:  ElitePennyStock
Paying party: Intraday Holdings Ltd
Shares outstanding: 129,400,000
Previous closing price: $0.861
Market capitalization: $111 million

 

A Few miscellaneous notes

Penny stock gadfly and one-time stock promoter George Sharp threatened AREN with a lawsuit but never followed through.

goniffs

I cannot vouch for their reporting skill / reliability, but The OTC Today reported that FINRA had asked clearing firms Alpine and ETC to voluntarily restrict the sales of large blocks of AREN stock.

One of the ElitePennyStock websites has a nice little video promoting AREN here. ElitePennyStock is following the lead of StockTips by inventing a fake person to be the promoter, in this case, Keith Richie.

 

Disclaimer: I am currently short 5200 shares of AREN. I may cover those shares or short more in the days following the publication of this post. 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.

Riviera Tool Corp $RIVT does a NEST

When people ask why I prefer to trade penny stocks and preferably OTC stocks, my answer is that I prefer to trade against people who are less intelligent and experienced than I am. Considering all the smart people working at hedge funds I would likely be less intelligent and less experienced than the people trading big money on real stocks like Apple and Tesla. But every once in awhile the amount of stupidity I see in the trading of a stock astounds even me. Riviera Tool Corp (RIVT) is a recent example of this.

What happened with Riviera Tool Corp (RIVT)? After the market close on Wednesday, May 6th, the Detroit Free Press reported that Tesla (TSLA) was buying “Riviera Tool” of Grand Rapids, a tool and die supplier to Tesla. After Riviera Tool Corp (RIVT) started spiking Jason Shubnell of Benzinga reported the acquisition and specified that it was Riviera Tool Corp (RIVT) that Tesla was buying, which was wrong — it was Riviera Tool LLC that was acquired. Riviera Tool Corp had all its assets seized by creditors back in 2007 and had been an empty shell since then. For summaries of exactly how there came to be a public zombie shell Riviera Tool Corp and a private Riviera Tool LLC, see this SeekingAlpha article. After the market close on the first day Riviera Tool Corp was halted by FINRA (U3 halt)  and it remains halted as I type this. See the intraday chart of RIVT on the day it spiked.

Back in 2013 a similar situation happened with Nestor Inc. (NEST) after Al Gore talked positively about Nest (maker of the Nest learning thermostat). Dumb investors/traders bought the stock of Nestor, which at the time was essentially a shell company with no assets, thinking it was Nest Inc. Take a look at the intraday charts of NEST over the three days it ran up and then dumped back down (days 1 and 2; day 3). Here is a description of what happened. When Google acquired Nest in early 2014 Nestor Inc stock had another run. The NY Times Dealbook had a nice description of what happened then.

The Nestor / Nest confusion wasn’t even the only time that happened in 2013. In the same month that year there was lots of talk about Twitter (TWTR) going public and the company started filing paperwork for its eventual IPO. Traders then bought stock in bankrupt (and essentially worthless shell) Tweeter Inc (TWTRQ) and the stock shot up from 1 cent to 14 cents. Even after the first run up and a halt to change the ticker to THEGQ so that people would not be confused the stock had a second run up two weeks later and ran from 2 cents to 10 cents.

 

Disclaimer: This article has been edited to show that NEST had two separate dumb runs after news of Nest Inc. I am short 15,000 shares of RIVT at Interactive Brokers that I will look to cover when it reopens for trading. 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.

Nutranomics $NNRX pump and dump (with emphasis on the dump) by “Brighton Markets”

Perhaps the most enigmatic stock promoters currently in business is the group known by traders as “Brighton Markets”. They bring huge volume to their promotions and their promotions last for weeks or months. Their two most recent promotions were of iTalk Systems (TALK) and Green Innovations Ltd (GNIN). Prior to these two promotions (their only promotions this year) Brighton Markets had been less successful and was best known for the epic dumps of their pumps. Despite the big moves up in TALK and GNIN, both had epic dumps as well. See my blog posts on prior Brighton Markets pumps GNIN and TALK.

gnin

Why is Brighton Markets the most enigmatic of current promoters? Well, the thing I find most interesting about them is that they appear to use their websites for only a brief period of time, two or three pumps, before abandoning them and adding new websites. While other promoters have added and shed lots of websites, the rapidity with which Brighton Markets abandons websites is far greater, more akin to the spam promoter “StockCastle” than to AwesomePennyStocks. Here is a current list of active Brighton Markets websites that I have discovered: note that only a few of these websites were also used for the TALK promotion.

nationaltradersassociation.com
NationalTradersAssociation.org
DividendSeeker.net
investors-alliance.com
tradersinsight.net
EquityPlays.com
Equity-Plays.com
BuysideTraders.com
InvestorsSense.com
InvestorsReports.com
Market-Digest.com
AnalystsCorner.com
WSReports.com
wallstsource.com
GainerHunters.com
STSense.com
PlatformAnalysis.com
ECAgrp.com
IndustryWeekly.net

Notice the IP addresses of the websites in the list below. Over the last year most traders of promoted stocks have become aware of the ease with which a person can run a reverse-IP search to see what other websites are on the same server and have the same IP as a promoter’s website. I guess the “Brighton Markets” folks thought they would make it a little harder by putting their websites on different IP addresses. Of course, because they are all hosted at OffshoreRacks.com, they have IP addresses that are very close and they share a domain name server. Once I figured that out it was easy to find their other functional websites (and many that are defunct).

 

Website IP Address
nationaltradersassociation.com 190.14.39.26
NationalTradersAssociation.org 190.14.39.26
DividendSeeker.net 190.14.39.29
investors-alliance.com 190.14.39.30
tradersinsight.net 190.14.39.19
EquityPlays.com 190.14.39.13
Equity-Plays.com 190.14.39.13
BuysideTraders.com 190.14.39.12
InvestorsSense.com 190.14.39.22
InvestorsReports.com 190.14.39.18
Market-Digest.com 190.14.39.21
AnalystsCorner.com 190.14.39.16
WSReports.com 190.14.39.17
wallstsource.com 190.14.39.17
GainerHunters.com 190.14.39.11
STSense.com 190.14.39.25
PlatformAnalysis.com 190.14.39.20
ECAgrp.com 190.14.39.23
IndustryWeekly.net 190.14.39.27

Here is a list of some of their defunct websites or websites that may not have ever been used:

WorldStreetFundamentals.com
BrightonMarkets.com
BollingerReport.com
BeforeTheCrowd.net
Provestor.net
TechnicalGroup.org
GainHunting.com
Micro-Cap.org
CFAReports.com
EquityPlayers.com
SmallCapitalNetwork.org
SectorTracker.org
QuickTickers.com
GainerHunter.com
TradersInsightMagazine.com
InvestmentNewsCenter.com
FinanceNewsletter.com
StockTipLine.com
GainHunter.com
GlobalEquityAlert.com
EquityLeader.com
MarketFoundations.com
BreakoutFinder.net
PennyStockplayerz.com
EquityMarketsinc.net
RisingSunReport.com

talk

Taking a page from the AwesomePennyStocks playbook, the Brighton Markets group has continued to send emails to the email lists of many now-defunct websites, including BrightonMarkets.com (email I received on 9/28 shown below):

nnrx_email

But even more interesting is that the CANSPAM-required information of all of these emails shows the following image:

membersealgray

 

Clicking on the “Legal Disclaimer” or “Compliance Disclosures” links takes you to different pages on the ECAgrp.com website. Visiting that website is like taking the blue pill and going down the rabbit hole. Evidently, ECA stands for “Ethics, Compliance & Awareness”. I never imagined that I would ever see a stock promoter talking up their ethical credentials. Perhaps even more bizarre is that at the footer at the bottom of that web page indicates that the ECA Group is a self-policing professional organization and links are given to file complains about a member and to submit an official inquiry from a regulatory body. That all sounds very professional, but of course every single promotion website that is part of the ECA Group is owned by the same promotion group, promoting the same stocks, and run on the same server.

self-reg

complaint

The cherry at the top of this absurdity sundae though has to be the WHOIS information on the website ECAgrp.com This “self-policing professional organization” has a website that was registered on 26 September 2013, after the promotion of NNRX had already begun.

whois

nnrx

[Edit 2013-12-12] There was an ‘analyst’ website setup to promote NNRX called EquitiesExpertise.com. A copy of their NNRX report is here.

Disclaimer: I have no position in any stock mentioned. 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.

SEC sues alleged stock manipulators behind BlueFire Ethanol (BFRE) and other pump & dumps

BlueFire was one of the first pump and dumps I observed. Below is the chart. Guess where the pump and dump occurred.

bfre

Here is the summary from the SEC’s litigation release:

The Securities and Exchange Commission today filed a complaint against Blake Williams of Dallas, Texas, and registered representative Derek Lopez, of Torrance, California, and numerous entities that they controlled, alleging that they committed securities fraud by manipulating the markets of numerous microcap stocks from 2006 to 2008. The Commission alleges that the defendants sold stock in unregistered offerings and that their subsequent manipulation led to artificially high prices and volume, which allowed the defendants and others to sell their holdings for substantial gains. The complaint also alleges that Williams acted as an unregistered broker-dealer when he solicited purchases of stock and traded on behalf of investors who bought stock from him.

The Commission’s complaint alleges that Williams, using five entities that he controlled, and Lopez, using the entity Da Big Kahuna, LLC, engaged in a number of manipulative practices, including:

  • engaging in “bid support” by placing orders for shares at prices below the inside (highest) bid to absorb sell orders and create an artificial floor for the stocks;
  • trading in multiple accounts through multiple brokers to give the false impression that there was greater demand for the stocks than truly existed;
  • coordinating trading among a group of individuals for the purpose of maintaining stock prices; and
  • obtaining securities in unlawful, unregistered offerings and then selling the securities to investors and into the markets in similarly unregistered and unlawful transactions

Here are some details on which companies were affected, from the SEC’s legal complaint (pdf):

53. Williams and the Williams Entities participated in the manipulation of the stocks of at least a dozen issuers (Advanced Growing, Axium, Bluefire, Datascension, Interlink, Medirect Latino, National Automation, Packaged Home, Pet Ecology, Remote Surveillance, Riverdale, and Straight Up).
54. Lopez and Da Big Kahuna participated in the manipulation of at least eight stocks (Axium, Bluefire, Interlink, Packaged Home, Pet Ecology, Straight Up, National Automation, and Remote Surveillance).
55.
The defendants used a variety of methods to manipulate the markets for the targeted stocks including, “bid support,” controlling the float, coordinated trading, and trading in multiple accounts.

I find the details of how the alleged manipulation took place to be especially enlightening:

A. Bid Support
56. The defendants and others engaged in what they referred to as “bid support.” This conduct involved layering orders at or near the best bid and ask prices with the intent to stabilize or increase share prices.
57. The defendants placed buy orders for stock at prices immediately below the “inside,” or highest, bid price posted by the market makers. For example, if the highest bid posted by a market maker was $1.50, the defendants might place orders at $1.45, $1.40, and $1.35, often for small amounts of stock.
58. These orders had two purposes. First, the defendants intended to create an artificial floor price for the stock when there was increased selling in the market; the defendants expected that the supporting orders would absorb some of the sell orders so that the stock prices would not fall dramatically. Second, the defendants placed the orders through different brokerage firms so that market participants would see a substantial number of bids and conclude that there was greater demand for the stocks than truly existed.
B. Controlling the Float and Coordinating Trading
59. The overall manipulation strategy relied upon controlling the “float”—the total shares available for investors to trade for a particular stock. As part of the scheme to distribute shares in unregistered offerings, the defendants and others ensured that the majority of shares without restrictive legends were controlled by the group.
60. The defendants and other participants in the scheme controlled the float so that shares would not be “dumped” into the market indiscriminately while they were selling their shares into the market.
61. As described above, the individuals who bought shares from the Williams
Entities had their shares pooled for some initial period (typically 30 to 60 days) and Williams traded their shares during this lock-up period.
62. The defendants and others engaged in coordinated trading to deceive the markets and extract profits from artificially high stock prices. This was accomplished by, among other things, selling in times of increased volume and price and not selling in times of low prices and/or volume.
C. Trading in Multiple Accounts
63. The defendants traded through several different brokerage firms using multiple accounts. This practice gave the impression of market depth to those looking at the market on a “Level II” or “Level III” screen, which identifies the market makers that are originating bids. Additionally, trading spread over many brokerage firms might avoid “red flags” with brokerage houses if large amounts of stock were deposited via stock certificates, thus concealing the fraud.
64. Williams traded stock on behalf of the Williams Entities and in his own name through accounts at multiple brokerage firms. Williams often deposited shares across the numerous accounts to avoid scrutiny and purportedly to ease the “clearing process.”
65. For instance, in the case of Axium, Williams directed the transfer agent to issue stock certificates to TBeck Capital, Victoria Financial, Valek Investments, Warren Street, and himself. An email from another individual to Williams said, “distribute free trading stock to 3 brokerage firms. Remember that the small cert[ificate]s go out first. Don’t send Lampost [Brokerage] any Victoria shares since they think I am on too many accounts.” Valek Investments’ one million Axium shares were issued in twenty certificates of 50,000 shares each. As part of depositing these numerous certificates across all of the accounts, Williams told one of his brokers, “I thought I would deposit one 50,000 share cert[ificate] into each account to make sure y’all are comfortable before I drop the bigger ones in.”
66. Similarly, Lopez traded securities at both his employer and “away” from his employer (in accounts at other firms), and traded in both his own name and in the name of Da Big Kahuna. Lopez made efforts to hide his activities on behalf of Da Big Kahuna from his employer by not properly designating them as “related” accounts. Moreover, the accounts for Da Big Kahuna are listed in the name of one of Lopez’s relatives even though Lopez controlled the trading in those accounts.

Disclosure: No positions in any stocks mentioned. 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.

Trade recap for May 12th

Mentions of AEHI in chat:
[May 12, 2010 12:00:56 PM EDT]     JC      AEHI hod
[May 12, 2010 12:17:32 PM EDT]     JC    AEHI seems pumped hmm
[May 12, 2010 12:22:32 PM EDT]     JC    frigging… AEHI new hod
[May 12, 2010 12:24:59 PM EDT]     SteveS    AEHI how high will that go?!
[May 12, 2010 12:28:03 PM EDT]     Reaper    AEHI omg
[May 12, 2010 12:28:09 PM EDT]     JC    wtf…AEHI..
[May 12, 2010 12:30:28 PM EDT]     Reaper    shorting a bunch of AEHI … very risky
[May 12, 2010 12:30:46 PM EDT]     Reaper    short 3100 AEHI @ .97055

IFLG a nice short (in SogoElite, not shown below):
[May 12, 2010 2:57:57 PM EDT]     Reaper    shorted 1k IFLG @ 5.35 @ sogoelite … very tight 10 cent stop
[May 12, 2010 2:58:50 PM EDT]     Reaper    I like the big offers on IFLG @ 5.37 and 5.40
[May 12, 2010 3:05:59 PM EDT]     Reaper    covered 500 of my IFLG @ 5 still short 500
[May 12, 2010 3:09:42 PM EDT]     Reaper    out IFLG @ 5

My trades today (except those at SogoElite):
BOT    1,000    AMEL    false    Stock    1.3100    USD    SMART    10:26:48        5.00
BOT    1,000    AMEL    false    Stock    1.3100    USD    ARCAEDGE    10:27:22        5.00
SLD    2,000    AEHI    false    Stock    0.9300    USD    SMART    12:27:34        9.30
SLD    100    AEHI    false    Stock    1.3400    USD    SMART    12:28:53        1.00
+    SLD    1,000    AEHI    false    Stock    1.030    USD    SMART    12:30:22        5.00
BOT    1,500    AEHI    false    Stock    0.6000    USD    SMART    12:45:10        4.50
BOT    1,600    AEHI    false    Stock    0.6500    USD    SMART    12:58:53        5.20
+    BOT    5,000    DIVX    false    Stock    7.235    USD    SMART    15:48:17        25.00
+    SLD    2,500    DIVX    false    Stock    7.300    USD    ARCA    15:48:52        12.50
+    SLD    2,500    DIVX    false    Stock    7.400    USD    ISLAND    15:49:12        12.50
+    SLD    500    DIVX    false    Stock    7.510    USD    SMART    15:50:58        2.50
+    BOT    500    DIVX    false    Stock    7.550    USD    SMART    15:54:12        2.50

09:53:31    PRWP    B    0.8    1630    NITE
10:22:18    PRWP    S    0.83    1185    NITE
10:19:11    PRWP    S    0.83    445    NITE

Daily profit: $2,193.60

AEHI Intraday chart
aehi

Disclosure: No positions in any stocks mentioned. 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 sues alleged masterminds of Emergent Health (EMGE) pump & dump

See my previous post calling Emergent Health “the next pump.” Tim Sykes also wrote about Emergent Health.

Evidently the SEC agreed with Sykes and myself as they have sued individuals involved in an alleged scheme to pump and dump Emergent Health and another company, Cardiovascular Sciences. Following is the SEC’s litigtation release; see legal complaint (pdf) for more details.

U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 21513 / May 4, 2010
Securities and Exchange Commission v. Seven Palm Investments, LLC, et al., Civil Action No. 1:10-cv-02755 (N.D. Ill.) (May 4, 2010)
The Securities and Exchange Commission filed a civil action today in the United States District Court for the Northern District of Illinois against Naperville, Illinois based Seven Palm Investments, LLC and its principal Peter P. Veugeler, together with Orlando, Florida based Cardiovascular Sciences, Inc., and Lawrence H. Hooper, Jr. of Oviedo, Florida, for antifraud and registration violations.

According to the SEC’s complaint, from at least October 2007 through September 2009, Veugeler reaped a total of more than $8 million from the pump and dumps of two unrelated companies, Cardiovascular Sciences and Emergent Health Corp. The SEC alleges that Veugeler, through his company Seven Palm, promised financing to both companies in exchange for nearly all their purportedly unrestricted shares. Veugeler, among other things, entered manipulative trades in both companies’ stock, allowing Seven Palm to sell its stock holdings in both companies at artificially inflated prices.

The SEC’s complaint further alleges that Cardiovascular Sciences and Hooper, Cardiovascular Sciences’s president and CEO, disseminated false and misleading press releases and other correspondence to investors between October 2007 and February 2008. The complaint also alleges that Veugeler reviewed and discussed with Hooper a number of the false press releases and directed him to work with a third-party stock promoter to issue the press releases to the public.

According to the SEC’s complaint, Veugeler engaged in manipulative practices aimed at misleading the market to increase and maintain artificially high prices so Veugeler could resell Seven Palm’s Cardiovascular and Emergent holdings for substantial gains.

The SEC’s complaint further alleges that Veugeler devised a Cardiovascular promotional campaign to facilitate Seven Palm’s liquidation of its Cardiovascular shares and that many of the Defendants’ public misrepresentations and omissions concerned Seven Palm providing funding to Cardiovascular. The complaint alleges that public statements regarding Seven Palm providing funding to Cardiovascular were misleading because at the time they were made, Seven Palm had not provided any funding to Cardiovascular.

As alleged in the SEC’s complaint, the defendants violated Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The complaint seeks a judgment against all defendants providing for injunctions, and civil money penalties. The complaint also seeks disgorgement of ill-gotten gains with prejudgment interest against Seven Palm, Veugeler, and Cardiovascular Sciences, and penny stock bars against Veugeler and Hooper.

Here is the stock chart of Emergent Health:
emge

Here is the stock of Cardiovascular Sciences:
cvsc

Disclosure: No positions in any stocks mentioned. 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.

February pump & dump recap

Here I show the charts of pumps from February and January. See if you notice a pattern. I bought most of these and shorted a few of these. When pump & dumps inevitably dump they drop fast, which is why I always say that buying pumps is very risky. So please, unless you are a trained professional, do not try to buy pumps … the short selling (when shares are available) is far easier.

BGEM – Was a re-pump in February that I bought. The December pump was even better (that is usually the case with re-pumps).

bgem

ECOB – I made $7,000 shorting this in January. I should have held my position longer.

ecob

ISPI – Weak pump. If you buy it you have to sell quick!

ispi

MDCE – Nice pump that Timothy Sykes nailed from the short side on the day it collapsed. I made a bunch on the long side.

mdce

NXTH – I shorted around $3.10 and covered around $2.60. Oops. I still made a couple thousand dollars.

nxth

PEPR – The pump was nice in percentage terms but it never got very high. I still made some money.

pepr

RCYT – Weak pump. I still made some money buying it.

rcyt

WKLI – The latest pump, not bad and I made some money buying it. The dump has only just begun.

wkli

Disclosure: No positions in any stock mentioned. 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.

The inevitable conclusion to any pump & dump: Charts of CNWI, CRWG, PEPR

CNWI – This pump only lasted a couple days and then had a huge gap down when further pumping failed to materialize.

cnwi

CRWG – A low-volume longer-term pump. Three big down days have eliminated most of its gains.

crwg

PEPR – Pumpers love new OTC listings and ticker changes. Again this only lasted a couple days. Most of the volume appeared ‘fake’ to me, occurring in huge block trades.

pepr

Disclosure: No positions in any stock mentioned. 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.

Trade recap: Short selling NXTH for fun and $2700 in profit

Horrible trading on my part with NXTH but I still did okay. I love penny stock trading! See the video for more. Also check out a special edition of Tim Sykes’ Livestock tonight from 6pm to 7pm EST.

Daily profit: $2677.44

nxth

Intra-day chart:
nxth

Disclosure: No positions in any stock mentioned. This blog has a terms of use and you can find all my disclaimers and disclosures there as well; my full terms of use is incorporated by reference into this post.

Watchlist for February 7th: One shot, one kill

While I wish my title were referring to stock promoters, unfortunately it refers only to my wish for a short on a pumped-up stock.

NXTH – ALFSS. This is very near collapse in my opinion. See Tim Sykes’ post on the pumping behind this stock rise.

nxth

MITI – Nice chart. I will ignore it and look at NXTH though.

miti

Disclosure: No positions in any stock mentioned. This blog has a terms of use and you can find all my disclaimers and disclosures there as well; my full terms of use is incorporated by reference into this post.