I guess Pussy's errant brother could not take it:"Hitsgalore.com Shares Fall After Founder Reed Resigns
Rancho Cucamonga, California, May 13 (Bloomberg) --
Hitsgalore.com Inc. shares fell as much as 28 percent after the
Internet company said its founder quit as a director and officer
following accusations he cheated customers in a previous job.
The shares fell 2 1/2 to 9 1/2 in early trading of 224,000
shares. Earlier they touched 8 5/8.
Dorian Reed, who's the largest shareholder, resigned his
posts as chief technology officer and director, a spokesman said.
It came after Hitsgalore stock fell 53 percent on Tuesday on
reports the company didn't disclose fraud charges against Reed.
Last month Reed and Audrey Reed were ordered by a federal
judge to pay $613,110 to 100 customers for false claims made by
Internet Business Broadcasting, a failed online advertising
company they worked for. It's unknown if the Reeds are related.
The Federal Trade Commission accused Reed and co-defendants
of touting a 100 percent annual return on investments of $5,000
to $7,500 in IBB Internet advertising banners. The company was
also accused of not providing refunds when investors didn't
receive their promised results. The FTC described Reed as IBB's
''principal telemarketer.''
Hitsgalore.com is making claims similar to IBB's. It says
on its web site that investors, by paying $99 to sponsor banner
ads on the Internet, can earn $495 if they get 20 more investors
to also pay $99 to Hitsgalore.com.
Hitsgalore.com was founded in July, four months after the
FTC sued Reed. It's based a few blocks from IBB's former
headquarters in Rancho Cucamonga, California, 60 miles east of
Los Angeles.
Hitsgalore.com went public on Feb. 11 by merging with
Systems Communications Inc., a publicly traded shell company. In
the merger agreement, filed with the Securities and Exchange
Commission, Hitsgalore.com said there were no suits or
governmental investigations against any of its officers,
directors or employees. It didn't disclose the FTC's case against
Reed in subsequent SEC filings.
The company's market value rose from $53 million to $1
billion within three months after it went public.
--David Evans in Los Angeles (310) 827-2348 with reporting by
Andy Davidson in Tokyo (813) 3201-8950 /ad/jh
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