They paid how much and never paid the options, I think we can credit the non payment of the options to Mr King who I heard back then was strongly against the $10,000 that George Chelikis was paid just befor he got there ...but he ...knew this Josh and things deleloped at NEXT WAVE. I can't remember the specifics of that call back then,,, but he was upset in general that prior folkd did a HOT STOCKS ( or should I say a HOT BOT ) thingy with George C. The wondering on who brought this Josh...an old friend...of who? Anyone remember what was said on how this Josh Levine ...and how he got our names on hismailing list, was it that I called his NY number ..or was it that he got all the SH from IZP office guys? I did call the guy and 20 question him- got 20 maybes...like he didn't KNOWN IZP like we know IZP; ie no talk IZPlish - I can't resist- NEXT WORM STOCKS REVIEW ? RE:
Internet tout targeted in SEC sweep
Inflazyme Pharmaceuticals Ltd IZP
Shares issued 24,997,493 Oct 28 close $0.44
Wed 28 Oct 98 Street Wire
Also Nord Pacific Ltd (NPF)
by Brent Mudry
SURF'S UP, DUDE!
An New York-based Internet tout who promoted Nord Pacific and Inflazyme
Pharmaceuticals under contract is among 44 penny stock promoters targeted
by the United States Securities and Exchange Commission in a massive
crackdown on Internet stock promotions revealed Wednesday. In what it calls
an "unprecedented nationwide sweep," the SEC filed 23 enforcement actions
for "committing fraud over the Internet and deceiving investors around the
world." Following the path blazed by its previous prosecutions of Florida
Internet tipster George Chelekis and New York radio tout Sonny Bloch, the
SEC notes its investigators targeted "purveyors of fraudulent spam, online
newsletters, message board postings and web sites."
The SEC claims the Internet tipsters unlawfully touted more than 235
"microcap" companies by either lying about the companies, lying about their
own "independence" from the companies, and/or failing to properly disclose
the nature, source and amount of compensation paid by the companies. "The
sweep, the first orchestrated coast-to-coast operation by the SEC to combat
Internet fraud, involved actions filed by SEC offices in Atlanta, Boston,
Chicago, Denver, Fort Worth, Los Angeles, Miami, New York, Philadelphia,
Salt Lake City and Washington, D.C.," stated SEC enforcement director
Richard Walker at a press conference in Washington.
Core Communications Group and principal Joshua Levine were the targets of
one of two New York prosecutions in the sweep of touts. The SEC notes that
Mr. Levine, 39, a resident of New York City, founded Core in March 1992 and
serves as its president and major shareholder. Mr. Levine launched his
company as Core Technology Group, to publish a business newsletter on tech
companies in the Long Island, New York, area. In 1994, he scrapped the
newsletter, changed the name to Core Communications Group, and focused on
investor relations work. The SEC notes that since 1994, Core has had nine
investor relations clients.
Since November 1996, Core has published reports on at least seven investor
relations clients, including Nord Pacific and Inflazyme Pharmaceuticals.
"Each report resembled a third party's research report," states SEC
secretary Jonathan Katz in a court filing. Core ran its site under the
banner "Next Wave Stocks," with the subheading "Intellectual Capital for
the Professional Investor." The SEC notes that Core and Mr. Levine
portrayed all the client companies favourably, but neglected to detail the
placement fees. "Although the reports disclosed that Core might receive
fees for acting as investor relations counsel, none of the seven reports
disclosed the amount of fees that Core and Levine received from the
companies pursuant to compensation arrangements," states Mr. Katz.
The SEC notes that Nord Pacific retained Core for investor relations work
from October 1994 to July 1997. Under the agreement, Nord was paid $3,500
(U.S.) per month, for a total of $115,500 (U.S.). Nord's American
Depositary Receipts traded during this period on Nasdaq. In February 1997,
Mr. Levine wrote a two-page Next Wave report profiling Nord. The SEC notes
the report was mailed to several thousand investors on Core's mailing list,
and posted to the Next Wave web site when it was created that June. The
next month, in July 1997, Nord shares began trading on the TSE at $6.25.
The SEC notes that Inflazyme, listed on the Vancouver Stock Exchange and
the Nasdaq bulletin board market, retained Core for investor relations work
between June 1996 and January 1997. Under the agreement, Inflazyme paid
Core $4,500 (U.S.) per month, plus a total of 80,000 options, to vest at
the rate of 6,500 per month. The SEC notes that Core received a total of
$36,000 (U.S.) during this period, but it did not receive any options. Mr.
Levine wrote a four-page Next Wave report on Inflazyme in November 1996,
and mailed it to 5,000 or 6,000 potential investors on Core's mailing list.
The stock tout also posted the report on Next Wave's web site when it was
created in June 1997.
The SEC notes that Mr. Levine and Core opted to reach a "cease and desist"
settlement by mutual agreement with the regulator. The agency notes that
Mr. Levine and his company violated Section 17 (b) of the Securities Act,
which makes it unlawful to tout stocks "without fully disclosing the
receipt, whether past or prospective, of such consideration and the amount
therof." The commission cites a Sept. 14 legal opinion that "vague
allusions to possible financial interest" are an insufficient defence, and
a 1996 case noting that a disclaimer of "possible receipt" of compensation
is inadequate when an actual agreement existed and compensation was paid.
While Mr. Levine's tout site claimed to be aimed up-market, at the
sophisticated crowd of "intellectual" professional money managers, his
pitch was a down-market pitter-patter aimed at aspiring surfer dudes. "A
good surfer knows how to read the waves. Doing it well makes the difference
between riding high or getting wiped out," states Core's spiel. "Surf's
Up!," proclaims Mr. Levine.
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