.REGISTERED SEX OFFENDER JOINS TOM HEYSEK AND A LONG LINE OF FRAUDULENT PROMOTERS IN PENNY STOCK ABSOLUTE HEALTH AND FITNESS STOCKFRAUD PROMOTION.
=======================================================
"Last week in this space we looked at a bungled SEC effort to take on a gang of penny stock pump-and-dumpers behind a North Carolina outfit named Absolute Health and Fitness Inc., which claimed to own a regional network of fitness clubs."
"Now, at least one of the players in that affair has surfaced in the stun gun bubble. He is a Casselberry, Fla. ex-con and registered sex offender named Orville Baldridge, who served as the promotional muscle behind Absolute Health and Fitness Inc. at the turn of the decade. Baldridge has now reappeared as the oomph behind the shell for a penny stock outfit called Law Enforcement Associates Corp. (LENF), whose stock price had soared 1,693% since last autumn on stun gun hype from a group of paid stock promoters in Vancouver."
nypost.com
STUN SHARES HYPE
By CHRISTOPHER BYRON
--------------------------------------------------------------------------------
Email Archives
Print Reprint
January 17, 2005 -- Two weeks ago, stock in a stun gun company was widely viewed on Wall Street as the hottest ticket in town, with just a handful of previously unknown penny stock outfits soaring on the shirttails of Nasdaq-listed Taser International Inc., to a combined market value of more than $1 billion.
Yet by the end of last week the gig seemed to be up, with pink sheets high-flyer Stinger Systems Inc. leading the way down with a one-day drop of more than 40%. Through it all, one could hear again that familiar tell-tale sound of hype, hope and hot air wheezing from yet another penny stock soufflé gone flat.
It's a sound that investors are hearing more and more these days as the growing workload of legislation like the Sarbanes-Oxley Act and the Patriot Act has caused the Securities and Exchange Commission to increasingly ignore regulation of the penny stock market. Result: a spreading plague of financial world squeegeemen in the gutters and alleyways of Wall Street.
Last week in this space we looked at a bungled SEC effort to take on a gang of penny stock pump-and-dumpers behind a North Carolina outfit named Absolute Health and Fitness Inc., which claimed to own a regional network of fitness clubs.
Now, at least one of the players in that affair has surfaced in the stun gun bubble. He is a Casselberry, Fla. ex-con and registered sex offender named Orville Baldridge, who served as the promotional muscle behind Absolute Health and Fitness Inc. at the turn of the decade. Baldridge has now reappeared as the oomph behind the shell for a penny stock outfit called Law Enforcement Associates Corp. (LENF), whose stock price had soared 1,693% since last autumn on stun gun hype from a group of paid stock promoters in Vancouver.
LENF's SEC filings are a hodgepodge of incomplete and conflicting information. In one bizarre case, the filings indicate that nearly 22 million shares of stock in the LENF shell — known as Academy Resources — were issued by a boat moving company that had no apparent power to issue them in the first place.
According to the filings, LENF began life in May of 1998 as a Ne vada penny stock shell called Academy Resources, Inc., with 5.45 million shares outstanding. Management consisted of a one-person board of directors, with the seat being occupied by a man named Nolan Moss.
The filings don't provide any additional details about Moss, but if the SEC had wanted to check him out, they would have found Moss to be a Vancouver-based penny stock crook who had already been fined $30,000 by Canadian regulators in a separate stock-rigging scheme.
Want more? Well, an exhibit to one of the SEC filings shows that in June of 2000, a mysterious Nevada outfit called "Academy Yacht Deliveries Corporation" popped up out of nowhere and purported to issue 21.8 million shares of "Academy" stock to acquire a Delaware-incorporated "development stage company" called Myofis Internet Inc.
Nor does this mishmash of alleged facts explain why a company identified only as "Carcinotek Internet, Inc." would surface as well in the deal as a joint signator alongside Myofis.
In fact, the appearance of Carcinotek simply underscores the duplicitous and ragged way LENF seems to have been run from the moment of its birth — as a toy for penny-stock promoters whose handshakes are often worthless and whose contracts get signed in disappearing ink.
In reality, Pasadena-based Carcinotek was not an Internet company at all, but an Armenian-controlled cancer research outfit that got shoehorned into the June 2000 merger of Myofis and the Academy shell in the apparent belief that the Armenian bunch would agree to become what amounted to financial tinsel in the deal.
Not surprisingly, the Armenians failed to play ball, leaving what had plainly been set up as the first step in a penny stock promotional hustle to go forward with not even a hint of a reason why the owners of the Academy shell would give away 80% of the shell's stock acquire an "Internet" business having no value at all.
In any event, once the merger was consummated in June of 2000, Nolan Moss surrendered his seat on Academy's one-person board to a fellow named Guy Cohen as Myofis's designated hitter.
Documents filed with the SEC in July of 2002 try to gloss over this entire period, stating only vaguely that by the end of 2000 the Myofis Internet project hadn't gotten off the ground so the investment was "written off."
Really? Archived Web pages obtained from a data collection research project involving the Library of Congress and the National Science Foundation show that a Web site called Myofis.com in fact went live literally days after the company claims it was shut down. What's more, by May 2001 the site had morphed into a promotional vehicle for penny stocks, called Streamingnews.net, with the Web site being registered to one Guy Cohen, who promptly began using it to pump LENF's share price.
In January 2002, Academy Resources merged with Law Enforcement Associates Corp., a privately-held North Carolina maker of various sorts of policing equipment and espionage gear.
To acquire the family-owned business, which had been run by a North Carolina State Senator named John Carrington, the shell's owners issued 10 million more shares of stock in the shell, complete with a befuddling and selectively applied one-for-three reverse stock-split designed to whittle down the holdings of the Myofis bunch while leaving Carrington himself untouched.
So, who is John Carrington? Over the years, North Carolina newspapers have reported on sales of paramilitary equipment by his company to oppressive foreign regimes such as those of prewar Iraq and Apartheid-era South Africa.
And just this last April, LENF was raided by federal agents seeking evidence to explain how equipment manufactured by the firm had wound up illegally in China. Yet the company has so far not issued a Form 8K to report this matter to the general public and no one at the SEC seems to have asked that it be done either.
LENF's newest cheerleader is a Vancouver-based stock promoter named Dawn Van Zant, who waves her pom-poms tirelessly on behalf of LENF and her other clients via more than three dozen different penny-stock pumping Web sites she owns and operates.
And looming in the distance behind all of these characters are the shadowy outlines of the penny stock world's Mister Bigs, who are a story for another day. But if the SEC lacks the manpower — or the moxie — to rid Wall Street of its squeegeemen and penny stock graffiti, why bother pointing out even bigger battles after that?
The penny stock market is a Wall Street alleyway that simply must be hosed down, and so far no one's doing nuttin'. Your tax dollars? Go figure.
cbyron@nypost.com |
