you are right link not working now? hmmm
anyways it was a n article from Bob Davis on VITC.
i wish i had copy and posted it
ok now
financialweb.com
SUSPICIOUS STOCKS
Suspicious: VersaTech
By Bob Davis
Friday, July 28, 2000 10:46:00 AM
Some deeds are best carried out under the cover of night, and it is darkest around 3:00 in the morning. At 3:21 AM, on
Wednesday, July 26, one of my readers received an e-mail from the "Equity Gurus.com Group Leaders List" to
announce:
Our New Stock Pick is: VITC
* We are all going to release it to our groups tomorrow night (Wednesday night).
* Join in if you would like... the more groups the better and it will make us all look good.
* We should all post on www.bobz.com, www.ragingbull.com, and www.ecooler.net about VITC on
Wednesday Night.
* We can ALL Make good money on this one if done correctly.
* There will be big news coming Friday.
* There will be these big groups promoting it all next week starting Tuesday.
* There target is $5... they will get it to $5 with or without us.
I will not editorialize about the level of crassness exhibited by this message. However, it appears to be very a clear-cut
violation of the Securities Exchange Act of 1934, and specifically Section 10 -- "Regulation of the Use of Manipulative
and Deceptive Devices."
Needless to say, the individual "Group Leaders" waited for each other like one little pig waits for another. Posts began
to appear on the various I-net forums almost immediately, but they didn't have much impact.
VersaTech (OTCBB: VITC) opened Wednesday at its prior-day close of $1.1875, briefly moved up to $1.2188, then
dropped for the rest of the day, closing at $1.0312. And it followed the same path on Thursday. However, I expect that
even stronger "promotional efforts" will be made today to move this stock higher.
What's Wrong with this "Story"?
In light of this apparent Section 10 violation, does VersaTech's "story" really make much difference? If you are really
interested, just check out the various I-net forums for the URL of a "Group Leader" web site.
A review of the company's latest 10-K Report to the Securities and Exchange Commission shows that VITC runs a
"network marketing system" that initially focused on "collectables." However, as the company's sales in this area have
been declining steadily for the last several years, it is now attempting to "become the leading provider of quality
content covering anti-aging advances and health on the Internet." Hey, this sounds just like Drkoop.com (NASDAQ:
KOOP)!
But What About the SEC Investigation?
The company's most recent 10-Q Report contains the following interesting piece of information:
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The United States Securities and Exchange Commission is conducting a formal investigation of the
Company, with which the Company's management is cooperating. The outcome of such investigation is
not known at this time. The Company is not a party to any material pending legal proceedings and, to
the best of its knowledge, no such action by or against the Company has been threatened.
So, for some unknown reason, the SEC is investigating this company. As a result, there is the possible risk that the
SEC is preparing to take some form of action, which certainly could include a trading suspension.
Normally, the SEC moves first and issues a press release later. A trading suspension, then, could take place before
any investor could react to it, and such action likely would be followed by a delisting from the OTC Bulletin Board.
A quick review of the "Group Leader" web sites shows that none of them appear to have mentioned this aspect of
investing in VITC.
Bob Davis is the editor and founder of The Napeague Letter, has 15 years' experience as Chief Financial Officer of
two different Nasdaq companies and a Harvard MBA. He does not own stock in, has not been compensated by and
has no affiliation with any of the companies he analyzes or their agents or affiliates.
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