CBQ Inc. (China Business Quotient) coined by Bart Fisher
A History Lesson in OTC Stock Manipulation
CBQ Inc. (OTC/BB: CBQI) On November 19, 1998, Freedom Funding, Inc., a Colorado corporation, entered into a reorganization agreement with CyberQuest, Inc., another Colorado corporation. Thus the shareholders of CyberQuest pursuant to which the Company acquired all of the outstanding proprietary interest of CyberQuest in a stock for stock exchange, which resulted in CyberQuest becoming a wholly owned subsidiary. The shareholders of CyberQuest basically acquired control through their stock ownership. However, the Reorganization Agreement called for the immediate change of the name to CBQ, Inc., along with an immediate effectuation of a reverse split, one for four (1:4) common share. This process was completed during December, 1998.
The ticker chosen ?CBQI? actually stood for its wholly owned subsidiary, CyBerQuest, Inc. whose main asset was Bid4it, an Internet auction site. In late 1998, the newest Internet industry buzz was auction sites. To complete the total picture, Reliance Technology was acquired and shortly thereafter Priority 1. The way the total picture was suppose to come together was Reliance would do the software and Priority 1 would handle the Electronic Fund Transfers (EFT) for the auction site. CBQI developed many safe guards for the public.
Nothing much ever seem to work out for CBQI so finally in August 1999, the major shareholders voted in new management
Now during this time the stock never traded much at all. Most of the time it only traded less than 1% of the float, which was/is 2,280,000. Try as the company may, Market Guide showed the float being 7.5M. To date I do not understand this float figure but maybe sometime in the future that figure will be accurate. So anyone looking at the stock thought it had over 7M in the float. Also during this time the stock came out at $5.00 fell to $2.50 and then back to $10.00 and eventually ended up trading around $1.75. Now there was a letter submitted to a shareholder meeting of a 240K short position by the old corporate shell owners, which explained why it crashed down from $10.00. However, the daily volume never really showed where that documented short position was ever covered.
Message 10750528 Two letters requesting covering shares
Message 10750545 The reply to the threatening short?s demands
Moving along in September 1999, John Harris was brought on board to make CBQI and its subsidiaries come together into a viable business with focus. Since being on board John Harris begun to diligently considering the business opportunities to expand the horizons of CBQ in regard to B2B e-solutions. Part of which was a medical care industry upon which recently CBQ has decided not to pursue or close on any deal that has been on going. The focus is on China and the implementation of being a China Bridge between the US and China for Internet B2B e-solutions.
The company?s website has been updated showing their Profile cbq.com, Alliances cbq.com and Subsidiaries cbq.com, which is bringing to look like CMGI as CBQI steadily grows its business.
The Time Line I have complied shows the news releases except for medical care industry, which was recently abandoned to focus on e-solutions in China and the USA. The time Line clearly shows the aggressive path John Harris has taken since he was brought on board marketex.net ? If you compare the news releases to the daily volume of the daily trading reports of the Market Makers to NASDAQ OTC, which I received from the OTC:BB site Times and Sales Website otcbb.com and then summarized each of the reports on a daily basis and made a spreadsheet marketex.net, which shows at the bottom of the spreadsheet an unaccountable of 1,868,929 shares. This was confirmed by John as the difference in the transfer agents reports and the ADP reports.
What does all they tracking mean? It can mean that some force or forces are attempting to hinder the stock. Even on excellent news the daily volume was held down to 1% of the float with 6% of the float trading on 01/12/00 with a highest volume to date of 206,045 and the oversell was 54,705. However, the stock closed at $15.63 and has only been allowed to trade over 1% to a whopping 2% of the float only 4 times since that time with some impressive news releases. The Summary of the Trading Log Summary is ragingbull.com .
Could it be the forces with 1.8M unaccountable are attempting now to take it below the $4.00 bid to stop the NASDAQ application from being approved knowing the 10K is due out this week? Also the finalization of the business plan and 12 projections are due out shortly. Could it be they are attempting to affect the apparent financing negotiations that the company is in since announcing the China approved letter of intent for a 2 way pager wireless with Internet connection? quicken.excite.com
Could it be this force does not want to account for the unaccountable should the NASDAQ application be approved?
Could this be more than just the MMs normal shorting to make a market?
Are they not aware that the lower they take it the more interest will come into the stock?
How long before the wide gap in the bid and ask no longer keeps big investors from coming in because they ignore the spread unlike short term, momentum/daytraders?
Is there a force trying to anticipant a dilution that may come into the stock in accordance with the stock structure but the NASDAQsc application may have compromised that logic?
How long can it be held down to trade 1% or 2% of the float with major price swings?
Are they not aware that such a low volume and major movement of price could be merely painting the tape to try and get some of the unaccountable shares sold back to them?
Are they not aware that such a tactic could result in an explosion when they are no longer able to affect the technical analysis?
Could the following stock structure up and until the Acquisition of ChinaSoft in December of 1999 be the underlying basis for the 1.8M unaccountable because of anticipated stock dilution they wish to capitalize on?:
 Stock Structure:
 Restricted for 2 years:
 18,000,000 Restricted for two years for Cyber Quest (November 19, 2000)
1,000,000 Restricted for two years for Reliance Technologies (March 15, 2001)
_ 900,000 Restricted for two years for Priority One (April 9, 2001)
4,233,200 Restricted for two years for Global Logistic Partners (May 11, 2001)
 ________ Restricted for two years for China Soft (________ ___, _____)
===========================================================
24,133,200 Restricted Stock
 Float:
 2,000,000 Free trading after 4:1 Reverse split. (Float)
_ 280,000 S8 Consultants (Float)
 2,600,000 S8 Employee Ten Year Term Options (none issued as of January 11, 2000).
 The affiliate will be subject to Section 16(b) of the Exchange Act. This means that the affiliate could not sell any shares acquired under the Option for a period of six months thereafter. Further, in the event that the optionee had sold any shares of Common Stock in the previous six months preceding the receipt or exercise of the Option, any so called "profit," as computed under Section16(b) of the Exchange Act, would be required to be disgorged from the optionee by the Company or the Commission. Common Stock issuable on exercise of an Option may be subject to such restrictions on transfer, repurchase rights or other restrictions as shall be determined by the Board of Directors of the Company ("Board").
 ============================================================
2,228,000 Float (Possible 4,880,000 Employee Options Available by 6-1-2000)
Could it be they are hoping for a larger dilution that they 2000 share 4 week 1% rule of 144 for insiders which iis calculated to be around 102K or 5% of the float?
 26,413,200 shares outstanding (26,406,532 issued and OS according to last Q)
 Free Trading:
 2,280,000 Float 580 shareholders of record Not Brokers Accounts (3,9031 per shareholder)
1,500,000 Very Friendly Large Shareholders/Investors
==================================
_ 780,000 Free Trading
 Note: The shareholders of record is around 990, I have heard, which would leave an average of 2,909 shares in each shareholder?s account.
Is the recent walk down on absolutely tiny volume where most were buys going to fool anyone?
Well I guess that is about how I feel so time will tell as the strange trading of CBQI continues on 1% volume ? Can they continue painting the tape when in fact it is coming to light what, why and how this is being done like in article by Stephen Rappaport?
baresearch.com
In fact, professionals will often "paint the tape" to skew the odds in their favor. Painting the tape is the technical name for the process of building bull and bear traps. These traps are designed to make unsophisticated investors believe a new trend has developed when in fact, the old trend remains valid. Unsuspecting investors will rush to add positions only to see the stock price quickly reverse. This practice causes wild volatility.
Is the emergence of technical analysis for individuals a good or bad thing? Any time individual investors are placed on the same footing as professionals it is a good thing. Successful investing is about gathering information. To make informed decisions individual investors need to be aware that technical analysis plays a large role in the stock market but they must also be aware that "trading" is a zero sum game. To trade with professionals it is important to learn how to identify real and false technical signals. Understanding the basics of technical analysis is not enough. Education is key. - by Stephen Rappaport
The longer I am in the market, the more I learn that things are not what they appear to be but painted for the purpose to rip off small investors. How long before regulation starts to stop this type of stock manipulation?
Just my thoughts ?
Gary |
