=DJ IN THE MONEY: Three Penny Stocks Bring Down ex-U.S. Att.
By Carol S. Remond
A Dow Jones Newswires Column
NEW YORK (Dow Jones)--Three heavily promoted penny stocks led to the downfall of former U.S. attorney Sam Currin.
Currin pleaded guilty earlier this week in the U.S. District Court for the Western District of North Carolina to charges that he conspired to launder $1.3 million through offshore accounts. Currin also pleaded guilty to two counts of obstruction.
That's quite a downturn for Currin, a former protege of conservative Republican U.S. Senator Jesse Helms, who was North Carolina's senior federal prosecutor from 1981 to 1987. Currin is also a former NC Superior Court judge.
The three public companies mentioned in Currin's plea agreement are: Absolute Health and Fitness Inc., Concorde America Inc. and Bio-Heal Laboratories Inc.
The criminal case against Currin follows in the footsteps of civil cases filed against the three companies promoters and entities associated with them by the Securities and Exchange Commission in the U.S. District Court for the Southern
District of Florida in 2004.
In the Absolute Health and Concorde case, the SEC accused two stock promoters - Donald Oehmke and Bryan Kos - and related companies of having pumped the stocks of the two companies. Jeremy Jaynes, a man convicted of spamming and sentenced to a nine-year jail term in Virginia, was also at the center of the SEC case, although he was not charged in that case.
According to Currin's plea agreement, he laundered money for a client identified as Mr. J. Mr. J isn't identified in the plea but is described as a man who was arrested on Dec. 11, 2003, the day Jaynes was arrested, in Virginia in a case involving E-mail spam. According to Currin's plea, Mr. J was convicted on Virginia spamming charges on Nov. 3, 2004. That happens to be the day Jaynes was convicted.
Jaynes recently lost his appeal to overturn his nine years sentencing. He is currently under house arrest, pending his appeal for a rehearing en banc in front of the state's Court of Appeals. A lawyer representing Jaynes in the Virginia case declined to comment on Currin's plea.
Currin describes in the document how he and others laundered illicit gains through various offshore entities and accounts.
Among the transfers detailed in Currin's plea are $689,000 of Mr. J's fundswired to Currin's law firm from the National Bank of Anguilla. According to his plea, Currin wrote five checks totaling about $689,000 that were distributed to Mr. J and his wife. "In addition, I caused approximately $16,000 of the funds to be distributed to my law firm. At the time the wire from the National Bank of Anguilla was received by my law firm, I was willfully blind to the fact that those funds were proceeds of criminal activity involving the promotion of the stocks of Absolute Health and Concorde," Currin said in his plea.
Also detailed in Currin's plea are hundreds of thousands of dollars that ran though offshore accounts and flew back to Mr. J with the help of Currin's law firm.
Currin also explains in his plea how he laundered $6,000 from a corporate account at First Curacao through the use of a debit card at teller machines in Raleigh, NC.
As reported in several Dow Jones "In the Money" columns, federal prosecutors in North Carolina began looking into possible criminal charges surrounding Absolute Health in late 2005. A prosecutor on the case wasn't immediately available, but Currin's plea will likely help investigators piece together the whereabouts of millions of dollars generated by the sale of stock heavily promoted on the Internet and elsewhere.
Absolute Health shares were trading at $0.005 earlier this month in very thin volume. Meanwhile, Concorde America's shares traded at $0.011 in late September on volume of a few hundred shares.
(Carol S. Remond is an award-winning columnist who won a Gerald Loeb Award in 2005 for best news service content with "Exposing Small-Cap fraud," a series of articles that described how three small companies unscrupulously pumped up their stocks.)
-By Carol S. Remond; Dow Jones Newswires; 201 938 2074;
carol.remond@dowjones.com
(END) Dow Jones Newswires |
