Don't shoot me I'm just the messenger for this news article just released in Vancouver, Canada.
Solucorp Industries Ltd -
Solucorp's malodourous legacy lives on and on and on
Solucorp Industries Ltd SLUPF
Shares issued 17,527,233 1899-12-30 close $0
Tuesday Dec 14 1999
Also Earthworks Industries Inc (EWK)
by Brent Mudry
The United States Securities and Exchange Commission's prosecution of Solucorp Industries is just the latest chapter in the former Vancouver Stock Exchange company's decade of regulatory troubles. Despite its growing legacy as one of the least fragrant garbage companies on the VSE, and a worthy contribution to the Scam Capital of the World moniker, Solucorp was able to attract former New Jersey governor James Florio and football legend Joe Theismann as publicity fronts in May of 1995. A mere five months later the VSE halted the controversial stock at $13.75 in the wake of revelations by Vancouver Sun reporter David Baines of dubious accounting deals and Solucorp's "symbiotic relationship" with Rene Branconnier's Thermo Tech Technologies, another smelly garbage promotion.
Solucorp's 10-year tenure in the doghouse dates back to 1989, when Nicholas Michael Ross, the president of predecessor World Tec Industries, began his spree of securities violations. In December of 1994, Solucorp then-president Joseph Kemprowski settled with the SEC by agreeing to disgorge illegal profits of $135,000 for violations by him and his New Jersey company, Cambridge Consulting, relating to Astro Enterprises.
Two months later, in February of 1995, Mr. Ross settled with the British Columbia Securities Commission by agreeing to an initial three-year trading and directorship ban for numerous securities violations. That fall, the VSE halted Solucorp several times amid its own growing controversy, and finally suspended the stock at $12 in December.
A month later, in January of 1996, the SEC ordered two brokers implicated in Mr. Kemprowski's Astro case to cease and desist from further securities violations. Although already a repeat securities offender, Harold Bailey Gallison Jr., the president of San Diego brokerage La Jolla Capital, was able to retain his leadership of the controversial brokerage.
On Aug. 18 of this year, an SEC appeal panel upheld fines of $100,000 (U.S.) each against La Jolla and Mr. Gallison in yet another case, involving Jutland Enterprises, an OTC Bulletin Board promotion. Mr. Gallison was also banned from associating with any member firm as a principal or in any supervisory capacity. He must requalify by examination before serving in any non-supervisory capacity in a brokerage firm.
Undaunted by its own troubles, Solucorp continued trading on the OTC Bulletin Board through 1996 and 1997, picked up United States brokerage M.H. Meyerson as a sponsor and continued pumping out impressive claims of massive contracts, deals the SEC contends were overinflated at best and fraudulently reported at worst. By late April of 1998, the scandal-plagued company was discontent to lurk in the murky world of the bulletin board, and made a confident bid to raise its profile with an application for a Nasdaq small-cap listing.
After a brief look at Solucorp's submission, a week later the SEC promptly imposed a rare 10-day trading halt, amid its own probe into potential disclosure irregularities. The SEC halted the stock at $5.84 (U.S.) on May 1, 1998, and Solucorp revealed a few days later that it was under formal investigation by the regulator.
In the SEC's civil complaint, filed Monday, the Vancouver flavour lingers strong. The key defendants include Mr. Kemprowski and Howe Street promoter W. Bryan Fair, who date back to Solucorp predecessor World Tec and its VSE affiliate, Procordia Explorations. The VSE halted trading of Concordia in October of 1992, citing concerns about dubious stock issuances to Mr. Kemprowski, Mr. Ross's companies Ruff Management and Inter Tec, and Mr. Fair.
Mr. Kemprowski was doing investor relations for Procordia through his company Cambridge Consulting of Maywood, N.J., under a Jan. 15, 1992, contract. (Almost three years later, in December of 1994, Mr. Kemprowski and Cambridge settled the Astro case with the SEC, with their $135,000 (U.S.) disgorgement order.)
In February of 1993, Procordia's new board revealed a host of serious irregularities. "It is likely that corporate funds were utilized, under the direction of previous management, in a manner that is not acceptable to the exchange," stated David Atkinson. Mr. Atkinson revealed Procordia had issued 625,000 shares without VSE approval and 475,000 of these shares were not paid for in cash, but with dubious offsetting accounts. Procordia's new board also noted Mr. Kemprowski's Cambridge contract had been terminated.
A month later, Mr. Atkinson revealed that an unidentified previous director had returned 300,000 shares "issued in error, for cancellation." "All ties to previous directors and management have effectively been severed," stated the new Procordia director.
Later that year, Procordia was renamed Earthworks Industries, with a consolidation of five old shares for one new share. While the new and improved Earthworks had rid itself of Mr. Kemprowski, Mr. Ross and Mr. Fair, it continued plugging away under the watchful eyes of the VSE, doing business with Mr. Kemprowski and Mr. Fair's Solucorp.
With Mr. Atkinson at the helm, Earthworks, listed on the new Canadian Venture Exchange, is happily plugging away on its Cortina landfill site on Indian land in California, ably assisted by its loyal partner Solucorp.
(c) Copyright 1999 Canjex Publishing Ltd. canada-stockwatch.com
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