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Reporter Daily News - 06/16/99
Pan American Bancorp exposed as scam
Reports on the Worldwide Web indicate that Pan American Bancorp,(PABN) the company that tried to pass itself off as a mortgage company with contracts in Belize, has been up to its old tricks again.
This latest report says that PABN has more than doubled the value of its stock and that things are progressing as planned regarding the Belize issue.
The Belize issue refers to claims made by PABN that its wholly owned subsidiary, Affordable Housing Group Limited, is a mortgage company which has the support of the Government of Belize. Last year it reported that it would begin to fund mortgages in Belize "in the late summer."
But inquiries by the Reporter newspaper revealed that the King Street address given by this company as its corporate address does not in fact exist.
Neither PABN nor Affordable Housing Group Ltd. has ever issued a retraction or an explanation for its fraudulent claims. Its Chief Executive Officer, John Schmitz, cannot be reached in Belize.
The United States Securities Commission allows people to register "shell companies" as private entities prior to placing them on the stock market for open trading. Very often legitimate groups who are in a hurry to incorporate would buy a "shell" and flesh it out with actual capital.
But shell companies who pretend to have money and contracts are clearly illegal. They are known as "pump and dump" scams, and PABN appears to fit snugly into this category of scam. In March 1998 a shell company known as PRWT, having no money but registered with 750 million authorized shares, was bought by John Schmitz and associates. Schmitz used only a promissory note to buy 400 million penny shares and interests in the "shell."
Schmitz then began to pump out a number of impressive press releases which reported that PABN through its subsidiary, Affordable Housing Group Inc., had entered into an agreement with the Belize Government for a profitable mortgage funding deal worth several million dollars.
The penny stock bounced by 25 percent almost immediately and bounced again by 56 percent to .22, but only on paper since this accretion cannot be verified. PABN continues to put out more releases about its so called success. Last year it posted more messages than Yahoo or America on Line.
Both the Governments of the PUP and the UDP have disclaimed knowledge of Affordable Housing Ltd. or its parent company, PABN. The Belize Central Bank has issued a disclaimer to say that these companies are not mortgage companies registered in Belize and have no authority to operate.
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