El-Batrawi formed Genesis Media group, Inc in late 1993, changed the Name to GenesisIntermedia, Inc before taking it public in 1998 under the symbol GENI. GenesisIntermedia was a marketing and incubator company. The Company was very successful and the stock rose at an average of 160% a year until the events of the 9/11 attack of 2001.
Prior to the attack of September 11 attacks GenesisIntermedia (GENI) became a battleground between the shareholders of GENI, led by El-Batrawi, and short sellers intent on destroying the company. This battle began in 2000 and hit a fever pitch in 2001 till the stock was halted when the market crashed after the attack of September 11 attacks.
Some of the facts surrounding this battle:
• Corrupt FBI agents worked for the short sellers
• Many of the short sellers were illegal naked short sellers
• Multiple legal cases, including criminal cases, have resulted from the Battle for GENI
This epic battle between El-Batrawi and illegal short selling is an amazing story of greed and corruption. El-Batrawi has been sued and lost millions of dollars in this battle. When it was all said and done El-Batrawi was vindicated and several people including two FBI special agents were convicted of criminal acts including, fraud, extortion and perjury, all related to GenesisIntermedia.
At the end of a seven-year investigation the justice department found no wrongdoing by El-Batrawi. The class action suit that was filled against GenesisIntermedia and El-Batrawi was declassified as a class and then later dismissed. [5] [6] Just before the statue of limitations expired the SEC filed a lawsuit in haste. The SEC lawsuit was settled without any fines and El-Batrawi entered in a consent decree with the SEC not admitting or denying any of the allegations to avoid any further legal bills.
The true culprits of the GENI Debacle were illegal shorter’s including famed shorter Anthony Elgindy. Also involved where three FBI agents Jeffrey Royer, Lynn Wingate and Cleveland.
On May 22, 2002, FBI agents Jeffrey A. Royer and Lynn Wingate were indicted for engaging in securities fraud, racketeering and obstruction of justice. An extortion charge was also filed against Jeffrey Royer.
Elgindy was arrested in San Diego in May 2002 along with FBI agents Jeffrey Royer and Lynn Wingate, who have been using their FBI positions to feed information on various corporations to Elgindy.
Elgindy used his site to give the impression that he was a selfless “crusader,” thus further exaggerating his influence. At trial Michaelson testified, the defendant “lied all the time. Exaggerated, enhanced himself. Made himself look good.” As noted, he outright lied with respect to GENI. All of these deceptions served to intentionally enhance the defendant’s ability to influence trading and prices.
SEC Attorney Rob Long testified that agent Royer contacted him in January 2001 with information on Genesis Intermedia (GENI) that he had received from Mr. Elgindy. Long then contacted Mr. Elgindy several times and Mr. Elgindy gave him additional information about GENI. In fact, Long requested Mr. Elgindy’s report on GENI, contacted Mr. Elgindy to “follow up” on GENI, and received and reviewed the email alert on GENI from Insidetruth.com
For GENI, and other stocks, the government submitted evidence of the dissemination of alleged law enforcement information on the website through chat logs. The government submitted evidence of dissemination of law enforcement information to Mr. Cleveland and Mr. Elgindy. Royer and Cleveland passed confidential law enforcement information to the defendant, who then passed the information to AP members, concerning GenesisIntermedia (“GENI”) and other stocks.
On July 2001 El-Batrawi sourced acquisitions for Genesisintermedia and arranged $100 million in acquisition loan commitment from Carl Icahn’s Riverdale, LLC for GenesisIntermedia, Inc. |
