SEC v. Torsten Prochnow d/b/a/ Stockreporter.de, Dennis C.
Hass and World of Internet.com AG
(U.S. District Court, Northern District of California)
(SEC Contact: Donald Hoerl, 303-844-1060)
The SEC alleges that Torsten Prochnow and Dennis C. Hass,
residents of Germany, touted the stocks of approximately 64 U.S.
public companies under the name Stockreporter.de. The touts have
been disseminated through postings on Stockreporter.de's Internet
website and numerous press releases. As set forth in the
complaint, Prochnow, Hass and WorldofInternet.com AG (a German
corporation owned by Prochnow and Hass) targeted U.S. investors
and these investors purchased the touted stocks based on the
Stockreporter.de recommendations. The Stockreporter.de website
contained false statements concerning the purportedly "long-term"
trading intentions of Stockreporter.de's principals. The website
also contained baseless financial and/or stock price projections
concerning one of the touted issuers. The website also falsely
stated that Stockreporter.de's principals were not compensated
for their touting, and both the website and press releases failed
to disclose both the nature and source of the compensation. The
touts caused the price and trading volume of the stock of certain
issuers to increase significantly in the short term. Baseless
recommendations resulted in price and volume for 28 stocks
increasing an average of between 28 percent and 390 percent. On
at least 15 occasions, the SEC alleges that Prochnow and Hass
sold their holdings of the touted stocks into the resulting
inflated market, realizing profits of $111,530. Without
admitting or denying the SEC's allegations, Prochnow and Hass
have agreed to the entry of an order that enjoins them from
future violations of Section 17(b) of the Securities Act of 1933,
Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-
5 under the Exchange Act. The order also requires them, jointly
and severally, to disgorge $111,520 plus prejudgment interest,
and for each to pay a civil penalty of $50,000.
sec.gov |
