Mark Schultz update from the SEC:
sec.gov
COURT ENTERS DEFAULT JUDGMENT AGAINST INTERNET STOCK TOUTER MARK SCHULTZ, ORDERS PAYMENT OF DISGORGEMENT, PENALTIES AND INTEREST
The Securities and Exchange Commission announced that on July 10, 2002, Judge Milton Pollack of the United States District Court for the Southern District of New York entered a default judgment against Mark Schultz, 49, an internet stock touter who now lives in Spain.
The Commission's complaint upon which the default judgment is premised alleged that, as compensation for his touting, Schultz received undisclosed stock and cash compensation from at least twelve issuers between 1995 and 1998. Those issuers are Acacia Research Corp., American Entertainment Group, American Nortel Communications, AWG, Ltd., Eutro Group Holdings, Inc., EVRO Corp., Imagica Entertainment, Inc., Imaging Diagnostic Systems, Inc., N.U. Pizza Holding Corp., Tessa Complete Health Care, Inc., Wasatch International Corp., and WestAmerica Corp. The Commission's complaint alleged that Schultz's recommendations typically made inflated financial projections and predicted short-term price increases of 100 percent or more. The Commission's complaint also alleged that Schultz misrepresented his recommendations of these issuers as the product of independent analysis when in fact his publications were merely paid tout sheets. The complaint alleged that in many cases Schultz would receive "bonuses" if the stock he touted achieved certain price levels.
The complaint also alleged that Schultz engaged in the practice of "scalping" or selling stock contrary to his circulated recommendations with respect to the securities of Acacia Research Corp., Advanced Laser Products, Inc., Colossal Resources Corp., and Imagica Entertainment, Inc.
Schultz moved from Florida to Spain in approximately late 1998. He did not file an answer to the SEC's complaint or contest the allegations, prompting the Court to enter a default judgment.
In its order, the Court permanently enjoined Schultz from future violations of Sections 17(b) of the Securities Act of 1933, and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-thereunder, and ordered him to pay disgorgement of $566,035.93, to pay prejudgment interest of $300,871.22, and to pay civil penalties of $110,000.00.
For more information about this case, please see Litigation Release No. 16541 (May 8, 2000).
sec.gov
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