Background checks on Duavant (CEO) and Rene Hamouth, (the largest shareholder) are enlightening.
Mr. PIn( will occaissionally post articles He has found to enlighten the investing public.
LEVEL 1 - 23 OF 23 ITEMS
Copyright 1991 Pacific Press Ltd.
The Vancouver Sun
July 5, 1991, Friday, 4* EDITION
SECTION: BUSINESS; Pg. D1
LENGTH: 990 words
HEADLINE: VSE targets questionable players: Suspicion leads to quick
halt to
trading
BYLINE: DAVID BAINES VANSUN
BODY:
The Vancouver Stock Exchange is waging guerrilla warfare against
Howe Street
operatives who play fast and loose with VSE companies.
During the past month, the exchange has halted trading in five
companies
whose activities have come under suspicion.
The exchange often runs interference with companies that don't appear
to be
playing by the rules, but now it is issuing detailed notices naming
names and
citing specific transactions that have caught their attention.
Previously such information was collected in internal files and
dispatched to
the B.C. Securities Commission or the RCMP market-surveillance group for
review. However, there were often lengthy delays before any action was
taken.
"If we find questionable people in a VSE company, we're going to
immediately
halt trading and start naming names," VSE surveillance supervisor Alfred
Stewart
said in an interview Thursday.
"If brokers get involved with these people, they're going to be
running a
significant risk that they will be left holding worthless paper."
On Wednesday, the exchange halted trading in Bicer Medical Systems
Ltd. and
issued a notice saying it had received information stock fraudster Erich
Brunnhuber had set up a company in Germany to distribute Bicer's heart
valves.
The VSE said this arrangement breached an earlier undertaking by the
company
that it would terminate all connections with Brunnhuber, who is out on
bail
pending appeal of a seven-year jail sentence for fraud, theft and stock
manipulation.
On Tuesday, the exchange suspended trading in Dynamo Resources Ltd.,
a VSE
company that recently acquired a computer-products firm.
The exchange said it wants the company to justify spending certain
funds
during the nine months ending Nov. 30, including consulting and
investor-relations fees of $ 259,056, management fees of $ 56,000 and
finders'
fees of $ 103,310.
It also said it wants the company to clarify "the role of Barry
Bampton in
the company's corporate and trading activities, and his relationship to
the
company's directors."
Stewart said Bampton, who worked as a broker with Yorkton Securities
Inc.
until February 1990, was receiving $ 9,500 per month for
investor-relations
services and had received the finders' fee for introducing the
computer-products
firm to Dynamo.
"The investor-relations contract with Bampton hadn't been disclosed
and the
finders' fee was double the amount approved by the VSE," said Stewart.
The VSE also said it wants proof that certain people who received
stock-option shares between May 1990 and April 1991 actually paid for
them, and
proof they were real employees and therefore eligible to receive
options.
"We're concerned that money received from the exercise of stock
options may
have flowed right out again," said Stewart.
Dynamo stock was trading steadily at the $ 1.65 level until the end
of
February, when it suddenly collapsed to 40 cents in a flurry of selling.
It had
slumped to 14 cents by the time trading was halted.
On June 11, the exchange suspended trading in First Star Capital
Corporation,
a VSE company that raised $ 200,000 in June 1990 to explore a mineral
property.
However, the company made no further mention of the property.
The exchange said it wants the company to disclose results of its
exploration
program and provide "the rationale for not carrying out the drill
program" for
which it had raised funds.
It also said it is reviewing the issuance of 100,000 shares to
acquire
another mineral property. Stewart said the exchange has learned there
are
several undisclosed encumbrances on the property.
The exchange said it also wants the company to clarify its
relationship with
May Joan Yee, former president of Lotus Cosmetics Ltd., and "the
rationale for a
proposed $ 5,000 per month investor-relations contract" with her.
Yee also figures in Boundary Gold Corp., halted by the VSE on June 6
pending
clarification of 12 share transactions involving 1.3-million shares.
Among the transactions cited by the VSE were 100,000 shares issued to
May
Joan Yee, 100,000 to Denis Shikatani and 100,000 to a company controlled
by
lawyer Mary Sloane and promoter Rene Hamouth.
Shikatani ran into regulatory problems in 1977 and was refused
registration
as a broker. He recently served as an officer of 21st Century
Securities, a
private company controlled by Gary Anderson, who is wanted by U.S.
securities
regulators for allegedly running boiler-room operations in Costa Rica.
In March this year, 21st Century Securities set up an office on West
Broadway
where it sold "rare" coins by telephone. The premises were vacated
overnight,
leaving a string of unpaid creditors.
Hamouth was charged along with promoters Rajiv Vohra and Brett Salter
in June
1990 by the RCMP commercial-crime section in Toronto with manipulating
the stock
price of Penway Explorers Ltd., an Alberta Stock Exchange-listed
company.
Until the charges are heard in court, the B.C. Securities Commission
has
revoked their trading rights and prohibited them from acting as officers
or
directors of any B.C. public company.
Hamouth and Shikatani were also involved in Bellwether Resources
Ltd., halted
June 3 pending clarification of four share transactions totalling
600,000
shares. They include:
* 200,000 shares issued pursuant to stock options to Jim Morgan and
Frank
Bull, but actually received by Hamouth and Robert Knight. Stewart said
company
officials claimed they had been paid for, but in fact no money had been
paid.
* 100,000 shares issued to Shikatani for distribution rights to the
Fry-Lite
Oven. (Formerly called the Roto-Fry Convection oven and promoted by
Harry Moll
through Cantebury Resources Ltd.) Stewart said Shikatani didn't own the
rights.
* 100,000 shares issued to Barrie Field-Dyte, "purportedly for the
acquisition of 70 Picasso lithographs." Stewart said he is not sure of
the
authenticity of the lithographs.
GRAPHIC: Bill Keay/ VSE cracks down: Supervisor of listed company
surveillance
Alfred Stewart at work keeping law and order
LANGUAGE: ENGLISH
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