OT:.....This is what the SEC is doing with companies making "DECEPTIVES PRESS RELEASES"
POSTED FOR INFORMATION PURPOSES ONLY.
Not directed to any company in particular.
"Wellness Universe Sued by SEC Over Deceptive
Press Releases
By David Glovin
Wellness Universe Sued by SEC Over Deceptive Press Releases
New York, Feb. 16 (Bloomberg) -- Wellness Universe Corp., an
umbrella company for health and wellness services, posted sham
press releases on the Internet that drove up the firm's stock and
allowed insiders to sell shares and reap large profits, the U.S.
Securities and Exchange Commission said.
According to court papers filed in U.S. District Court today,
Wellness and a sister company, Synpan Corp., began defrauding
investors in December by posting press releases claiming they
planned to buy an Internet company for $500 million and to conduct
an initial public stock offering for $1 billion.
None of this was true, the SEC claims in the suit. The scheme
pushed Wellness' stock from 10 cents a share to $1.10, enabling
company president George Pappas and other insiders to sell $2.3
million in company stock, regulators allege.
Wellness defrauded investors ''in a 'pump and dump' scheme
largely conducted over the Internet,' the suit said.
Also profiting was a vice principal at Fort Hamilton High
School in Brooklyn, New York, whose assistant was Pappas' sister,
the SEC claims. A teacher and a teacher's assistant at the school
also reaped gains, the suit says.
The SEC suspended trading in the company's stock on Feb. 11.
Pappas did not return a call seeking comment.
The complaint, which seeks civil penalties against Wellness,
Pappas, and other company insiders, says Wellness posted press
releases saying that Synpan, which is owned by Pappas, would pay
$500 million to buy Wellness and merge the companies.
The SEC says Synpan did not have the resources to make a $500
million investment. Synpan also had no plans to conduct an IPO
designed to raise $1 billion, as Wellness and Synpan claimed, the
SEC said.
Synpan, Pappas and other company insiders are named as
defendants as well."
Elio |
