NJ SENATOR TORRICELLI - BIG CROOK - NJ Politicians Ripping off the Poor People of Newark while Scamming in Penny Stocks. And DOJ will never touch Torricelli in NJ. Ever.
Two new stock deals by Torricelli
01/18/00
By Ted Sherman
STAFF WRITER
As an investor, Sen. Robert Torricelli (D-N.J.) is an admitted risk-taker.
He has bet money on highly speculative stocks, initial public offerings and a charter airline that never got off the ground. In one case, he doubled his money overnight in a $50,000 penny stock deal that turned out to be illegally manipulated by a New Jersey broker who later pleaded guilty to funneling illegal campaign contributions to Torricelli's 1996 Senate campaign.
Now, documents show that a $5,000 investment by Torricelli in a new Internet startup company turned a quick $220,000 paper profit. Further examination of the principals in the company, meanwhile, reveal others involved in the venture include an individual convicted in New Jersey of bank fraud in 1985 -- now a controversial figure pioneering Internet gambling that has drawn the attention of Congress -- and a former Las Vegas city attorney once charged with securities law violations.
In another deal available to only a few, Torricelli also invested in a second online company, yet to go public, that will sell diet plans on the Internet.
A spokesman for the senator said Torricelli did not know any of the other principals in these latest deals, both of which were presented to him by longtime financial advisers.
"They were aggressive investments, but that's the senator's style," said spokesman Richard McGrath.
The senator's latest foray into the stock market is not reflected on his current financial disclosure statement, filed last June. However, his name came up as a principal investor in two recent filings before the Securities and Exchange Commission involving eVentures Group, a publicly traded Internet holding company, and eDiets.com, a company that plans to market fee-based diet programs exclusively on-line.
Torricelli's investments in the two companies were first reported in Sunday's Asbury Park Press.
In one of the transactions, Torricelli was one of a group of individual investors in a company called e.Volve, an Internet telecommunications firm. The privately held company is headed by Steven R. Loglisci, a West Point graduate and former vice president at Bear Stearns who acted as Torricelli's investment adviser.
According to McGrath, Loglisci invited Torricelli to buy shares in the nascent company last year.
"It was something that Steve brought to his attention," he explained. The senator bought two shares at $2,500 each just before the company was acquired by another Internet company, eVentures Group, this past October.
With the acquisition, Torricelli's two shares of e.Volve Technology Group were exchanged for 8,333 shares of eVentures stock. On Friday, the stock was selling for $27. For the moment it remains a paper profit. There is a lockup agreement that prohibits any of the insiders from selling their shares for two years, a company official said.
Among others who profited from the acquisition were Kerry Rogers, named as the company's chief technology officer. Rogers was convicted in 1985 in a $22-million bank fraud involving the First National Bank of South Jersey. More recently, he has operated a Web site tied to offshore Internet gambling, but a federal Internet gambling case was dismissed against the Las Vegas resident in 1998.
Another principal of the firm was Karl Lovell, a former Las Vegas city attorney charged in a 1996 stock case involving the creation of shell corporations. He later settled SEC proceedings against him without admitting or denying the findings and was barred from participating in an offering of any penny stock.
Loglisci, reached by phone yesterday, said he offered shares in e.Volve Technology to friends and family who understood technology and were willing to take risks. At the time, he said, no one knew that eVentures would acquire the company.
"We were applying unproven technology. It (the company) was extremely distressed. It could go bankrupt any day," explained Loglisci.
He went to Torricelli, he said, because the senator was interested in technology and enjoyed investing and insisted that Torricelli's investment had no overtones of influence and carried no political motivations.
Loglisci said Rogers had long been associated with the company. Despite his conviction, he called Rogers "one of the brighter people in the Internet." Lovell was one of Rogers' attorneys, he added.
Torricelli's second recent investment -- in eDiets.com -- was brought to Torricelli by another close financial adviser, Matthew Gohd, who managed the senator's blind trust before it was dissolved in 1998.
McGrath said the investment in eDiets was available to all the clients of Whale Securities, under the same conditions offered to the other investors. The company has not yet been taken public.
Neither investment marks the first time Torricelli has benefited from an insider's deal.
A year ago, The Star-Ledger reported that Torricelli reaped a windfall of more than $50,000 on a stock offering brought to him through his blind trust, then being managed by Gohd.
The penny stock was later found to be illegally manipulated, in part by Lawrence Penna, a major contributor to the Democratic Senatorial Campaign. Last October, Penna pleaded guilty to orchestrating thousands of dollars in illegal campaign contributions to Torricelli's 1996 Senate campaign. He is scheduled to be sentenced today in New York.
And in 1994, Torricelli made $144,000 when he got an insider's price on an initial public offering for the First Savings Bank of Perth Amboy.
McGrath yesterday said Torricelli's latest investments have no current market value and are restricted from sale until the securities have been registered. He added that Torricelli's investments were fully legitimate and complied with Senate rules and regulations. |
