Apparently, the old "...PANGIA scam..." has finally hit the fan.
I hope this doesn't consequently wreck the operating company, which has a really good pollution control technology to offer:
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 17673/ August 9, 2002
SEC Files Civil Lawsuit in $15 Million "Pump and Dump" Stock Fraud Case
Securities and Exchange Commission v. Environmental Solutions Worldwide, Inc. et al.,
Cause No. 02-1575 JDD (D.C.)
The Securities and Exchange Commission announced today that on August 8, 2002, it filed a complaint against Environmental Solutions Worldwide, Inc. (ESWW), of Telford, Pennsylvania, formerly of Markham, Ontario, Canada, and related persons, alleging that they perpetrated a massive stock fraud in the Nasdaq Over-The-Counter securities market. The complaint alleges that the defendants issued ESWW stock to various insiders through a sham private offering, and then "pumped" the market with a fraudulent promotional campaign designed to artificially prime the market for ESWW stock. The promotional campaign had the intended effect: the price of ESWW stock soared by about 250%, from $2 to $7 per share. Concurrently, two of the defendants, Teodisio V. Pangia, of Kleinburg, Ontario and New York City, and Satbal Singh a/k/a Spal Singh, of Toronto, Ontario, sold approximately $15 million of ESWW stock into the unsuspecting market.
The other defendants in the case are:
Jalon Investments, Ltd., Gata Investments, Ltd., and Altea Investments, Ltd., three Guernsey companies controlled by Pangia.
Zoya Financial Company, Ltd., a promotional firm controlled by Singh.
Adam Michael Oliver of Otterville, Ontario, ESWW's former sole officer and director.
Michael W. Smith, a Canadian attorney residing in London, Ontario.
Bengt Odner, of the United Kingdom, ESWW's current chairman.
Michael Bergman, of Jersey City, New Jersey, and his promotional firm, Access 1 Financial, Inc., which hyped ESWW stock.
Eugene Foo, of Toronto, Ontario, who helped facilitate the sham private offering.
Specifically, the Commission's complaint alleges that from October 1998 through June 2000, Pangia, Smith, and Singh orchestrated a pump-and-dump scheme using fraudulent press releases, millions of spam e-mails, and a paid analyst report to prime the market for ESWW stock. The promotional documents falsely claimed that that ESWW had developed a revolutionary catalytic converter that, unlike any other catalytic converter, dramatically reduced toxic emissions, including nitrous oxide, a greenhouse gas believed to be a cause of global warming. These claims were false and contrary to ESWW's own test results. The promotional documents, including supposedly independent analyst reports, which Pangia paid Mark Bergman to publish, also contained unrealistic and unsupported share price projections for ESWW stock ranging from $15 to $150 per share. The complaint additionally alleges that Oliver served as an officer and director in name only, and that he, in fact, was merely a nominee for Smith, and that Odner repeated the false information about ESWW's test results in statements to the investing public.
The complaint also alleges that Pangia, Smith, Singh, and Foo orchestrated a sham private offering in which millions of unregistered ESWW shares were issued to themselves. These shares were dumped into the inflated market from the fraudulent promotional campaign described above. The three of them realized approximately $15 million from these stock sales. According to the complaint, Pangia also violated the beneficial ownership reporting provisions of the federal securities laws and ESWW violated the books and records and financial reporting provisions.
The Commission's complaint alleges that based on the conduct set forth above, the defendants violated the antifraud, securities registration, periodic reporting, record keeping, beneficial ownership reporting, false statements to an auditor, and stock touting disclosure provisions of the federal securities laws, including Sections 5(a), 5(c), 17(a), and 17(b) of the Securities Act of 1933, Sections 10(b), 13(a), 13(b)(2)(A), 13(b)(5), 13(d), and 16(a) of the Securities Exchange Act of 1934 ("Exchange Act"), and Exchange Act Rules 10b-5, 12b-20, 13a-1, 13b2-1, 13b2-2, 13d-1, and 16a-3.
The complaint seeks injunctions against all the defendants, officer and director bars against Pangia, Smith, Oliver, and Singh, disgorgement of ill-gotten gains plus pre-judgment interest from Pangia, Jalon, Gata, Altea, Singh, Bergman, and Access 1, and civil penalties against Pangia, Jalon, Gata, Altea, Smith, Oliver, Singh, Zoya, Bergman, Access 1, Odner, and Foo.
sec.gov
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