Hey People - Check This Out!
Subject: Hype
Date: Wed, Mar 18, 1998 16:56 EST
From: JimDFrost@aol.com
Message-id:
Maybe we should all get in at .003-4 and hype this comapny like so many others have done with pkgp, mers, adgi, etc... Someone on SI was inquiring about it so I am sure its just a matter of time before somebody hypes this co. 10k shares at .004....I may get in.. :-)
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 15312 / April 2, 1997
Accounting and Auditing Enforcement
Release No. 901 / April 2, 1997
SECURITIES AND EXCHANGE COMMISSION v. CHESTER HOLDINGS, LTD., formerly named AQUA BUOY CORPORATION, JOSEPH PIGNATIELLO, CONSTANCE PIGNATIELLO, and CHRISTOPHER WERNER, 97 Civ. 1654 (D.N.J.) (MTB)
The Securities and Exchange Commission ("Commission") announced today the filing of a Complaint in the United States District Court for the District of New Jersey charging a public company and three of its former officers and directors ("Defendants") with making false statements to the public concerning the company's financial condition and about certain businesses and assets that the company acquired. The three former
officers and directors are also charged with obtaining approximately $2 million in illicit profits by selling the company's stock at inflated prices.
Named in the Complaint are: Chester Holdings, Ltd. (formerly named Aqua Buoy Corporation) ("Aqua Buoy"), with its principal office located in Wayne, New Jersey; Joseph Pignatiello, age 50, residing in Coral Springs, Florida; Constance Pignatiello, age
40, married to Joseph Pignatiello, and residing in Coral Springs, Florida; and Christopher Werner ("Werner"), age 34, residing in Newport, Rhode Island.
According to the Complaint, between March 1991 and October 1992, the Defendants made materially false or misleading statements in press releases and Commission filings concerning five acquisitions of assets and businesses by Aqua Buoy. Specifically, the Defendants allegedly overstated the value of the consideration paid for the acquisitions, overstated Aqua Buoy's assets and shareholders' equity in its financial statements, and made false and misleading statements about the acquisitions. For example, the Defendants claimed that Aqua Buoy had acquired certain assets from Lord Jeff Knitting Company, Inc. ("Lord Jeff"), a then-bankrupt sweater manufacturer, for $14 million in securities when, in fact, the Lord Jeff acquisition was worth no more than $4.9 million. The Complaint also alleges that Werner made materially false and misleading statements, and gave misleading documents to, Aqua Buoy's auditor in connection with audits of Aqua Buoy's financial statements.
The Complaint also alleges that Joseph Pignatiello, Constance Pignatiello, and Werner sold Aqua Buoy common stock while knowing the truth about Aqua Buoy's falsely inflated financial statements and its acquisitions. Specifically, the Complaint alleges that Joseph Pignatiello and Constance Pignatiello, through several different brokerage accounts, sold approximately 1 million shares of Aqua Buoy common stock and realized nearly $2 million in illicit profits. The Complaint also alleges that Werner sold 27,000 shares of Aqua Buoy stock and realized approximately $74,000 in illicit profits.
The Commission seeks permanent injunctions against the Defendants, prohibiting further violations of the antifraud provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934. The Complaint alleges that Joseph Pignatiello, Constance Pignatiello, and Werner are liable, as controlling persons of Aqua Buoy, for Aqua Buoy's false and fraudulent reporting. The Complaint also demands that Joseph Pignatiello, Constance Pignatiello, and Werner disgorge their illicit insider trading profits and pay prejudgment interest on those illicit profits. The Complaint further demands that Joseph Pignatiello, Constance Pignatiello, and Werner pay civil monetary penalties for their fraudulent conduct. Finally, the Complaint demands that the Court issue an order barring Joseph Pignatiello, Constance Pignatiello, and Werner from serving as an officer or director of a public company.
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