SeaView CEO on probation for fraud localbusiness.com
By Bill Holland, LocalBusiness.com
Feb 15, 2001 07:33 AM ET
EXCLUSIVE ST. PETERSBURG, Fla., Feb. 15 (LocalBusiness.com) -- SeaView Video Technologies, infamous for issuing press releases promising sky-high sales followed by less than stellar revenue reports, is headed by a convicted con man, LocalBusiness.com has learned.
Company founder, chief executive officer and majority shareholder Richard McBride is still serving a probated 6-year sentence for organized fraud stemming from bilking local business owners out of at least $41,370 in 1996 and 1997, according to court documents.
McBride and his lawyer had no comment regarding McBride's conviction.
SeaView's chief executive routinely issues press releases forecasting huge increases in sales of the company's underwater and security cameras. According to those releases, McBride and other executives projected revenue of more than $40 million in 2000 while actually selling only $4.4 million worth of video cameras through the third quarter. The company reported profits of $216,132, or 2 cents per share, in the third quarter. Its fourth-quarter and year-end report is due out by next month.
According to police reports, in 1996 McBride offered to produce videos on a product called "Nico-Out" and take orders through an 800 number. An investigating officer found McBride used dummy orders to convince the businessmen their ads had been broadcast and then forged sales reports for products that were never ordered.
McBride pleaded no contest to one charge of organized fraud and received six years probation from Judge Timothy Peters in a February 1998 plea bargain. Thirteen months later he bought a Nevada shell company, Gopher Inc., for $250,000, providing him with a registered stock to trade for his new company, SeaView Video Technology.
McBride has dodged disclosure of his criminal background to investors in his company by never filing a proxy statement, threading a fine legal needle in the securities regulations, according to legal sources.
By skipping the IPO and retaining control of more than 50 percent of SeaView's shares, McBride has never had to call for a shareholder vote and file a proxy statement detailing his background.
While his lack of disclosure may be technically legal, when it was revealed by short traders at InsideTruth.com, McBride's probation officer Trish Smith informed "the appropriate authorities," according to corrections department spokesman Joe Papy.
Papy would not say if those agencies included the Securities and Exchange Commission.
A spokesman for the Commission, as a matter of policy, would neither confirm nor deny whether investigators are looking into McBride and SeaView.
Either way, McBride's application for early termination of his probation was shot down by Judge Peters earlier this month, on the negative recommendations of both the Pinellas County State's Attorney and the corrections department. Both those objections were a matter of policy, Papy said, the agencies routinely object to shortening time on probation when the conviction come through a plea bargain.
"It's standard practice," Papy explained. "That was the agreement you agreed to in the plea bargain."
Shares in SeaView (OTC BB: SEVU) open the market Thursday at $2.13, off 19 cents in very light trading Wednesday. The stock has plummeted from a high of $28.50 a year ago to hit bottom at $1.31 the week before Christmas.
Bill Holland covers Tampa Bay for LocalBusiness.com. E-mail him with story ideas or comments. |
