A Kind Lurker just sent this, from Canada Stockwatch:
Interlock Consolidated Enterprises Inc -
The mystery of the many Stock Watches
Interlock Consolidated Enterprises Inc
ILSS
Shares issued 22,707,035
1899-12-30 close $0
Wednesday May 28 1997
by Stockwatch Business Reporter
While Bre-X Minerals Ltd managed to keep from the public eye its connection to scandal and tainted characters -- at least during its 18-odd month rise to fame and fortune -- much more has become known about its past since Freeport-McMoRan Copper and Gold's drill results led to the initial March 27 meltdown of Bre-X's share price.
Recently, the Financial Post reported that controversial Alberta entrepreneur, Thomas P. Devlin, also was involved with Bre-X. Mr Devlin is named on company documents as Bre-X's manager of special projects and was granted 25,000 options in January 1996. According to the Post, Mr Devlin shared a secretary with Bre-X CEO David Walsh.
Last year, Bre-X wanted to appoint Mr Devlin to a more senior position, but that was rejected by officials at the ASE. "As far as the ASE was concerned, Mr Devlin would not be a suitable candidate to hold a position of officer or director or any position related to investor relations," exchange president Tom Cumming told the Financial Post. "We did some checks on his background and he had some securities-related problems that made him unacceptable to the exchange."
Those problems date to October 1983, when Mr Devlin was found to have benefited from "private profiteering" while a shareholder and comptroller of Calgary-based Hampton Securities, which later became Bay Street West Securities. The commission cease-traded Mr Devlin for two years after investigating allegations of fraud stemming from the initial issue of 1.6 million shares of Alberta oil firm Kanstate Resources Ltd in spring 1981. More recently, Mr Devlin and the Calgary office of C.M. Oliver & Co Ltd have squared off in court over a share-trading episode that went sour. The matter involves the trading of shares in Mississauga-based Interlock Consolidated Enterprises Inc.
According to the statement of claim filed by C.M. Oliver in the Alberta Court of Queen's Bench in September 1994, the unsuitable Mr Devlin opened a cash account at C.M. Oliver in the name of Stock Watch Ltd, of which he was president and sole person authorized to trade for the company. (Stock Watch Ltd is not affiliated with this publication, which is published by Canjex Publishing Ltd).
In early February 1994, the statement of claim alleges, Mr Devlin sold shares in Interlock that were not held in the Stock Watch Ltd account. Normal settlement rules of the ASE and C.M. Oliver state that the shares be delivered for settlement within five days. The price of Interlock shares declined over the next few trading days and Mr Devlin instructed the registered representative of the account, Gregory Justice, to buy shares to cover the sale. C.M. Oliver contends the dealing amounted to an undeclared short sale -- a violation of the policies of both C.M. Oliver and the ASE.
Later that month, Mr Devlin again instructed his representative to place sell orders for Interlock shares. Mr Devlin requested that the trades -- involving 487,500 shares -- be jitneyed through other brokerage firms so the sale of the Interlock shares would appear to be widespread.
When C.M. Oliver requested delivery of the shares of Interlock for which sell orders had been completed, Mr Devlin advised C.M. Oliver that he had a stock option enabling him to acquire shares of Interlock and that the option would have to be exercised in order to settle the outstanding shares. Mr Devlin provided the plaintiff with copies of an Interlock directors' resolution purporting to grant an option to acquire 584,908 shares of Interlock at $0.10 each to Nuala Julian Martin, also known as Nuala Julian Devlin, who is also named as a defendant in the suit, along with Mr Justice and Stock Watch Ltd.
C.M. Oliver forwarded the funds required to exercise the option to Montreal Trust, in trust and for Interlock, on March 15 1994. However, Interlock refused to honour the stock option, stating that it had no record of any such option having been granted to any of those who later would be named in the action. The plaintiff was unable to purchase sufficient Interlock shares to cover the sale made by Stock Watch in the open market and was forced to enter a private arrangement with Interlock president Douglas Murdoch to purchase 400,000 shares of the company at $1 a share. C.M. Oliver bought the remaining 87,500 shares on the market at prices in excess of $1 each. It has asked for damages of $369,891.01.
In the statement of defence, Mr Devlin, Stock Watch Ltd, Nuala Julian Martin and Gregory Martin deny all of C.M. Oliver's allegations. They maintain the "Interlock shares that Devlin sold in February were sold with the knowledge that the Devlins were in receipt of a legally contracted, signed and sealed stock-option agreement granted by Interlock, which was signed by Mr Douglas G. Murdoch, president of Interlock (and by the other directors.)"
The defence statement also maintains that "the selling of stock from a stock option agreement does not constitute a short selling of securities, and therefore (such securities) may be sold from a cash account (and so) is not a breach of the customer agreement." It further states the agreement document had been "obviously altered" without the knowledge or consent of the defendants, but was still accepted by the ASE and the ASC, adding that the ASE should have halted trading in Interlock shares once it received the stock-option agreement with a "whited-out change" on the directors" resolution page.
The defendants have filed a counterclaim against Interlock and the ASE asking for damages of $200,000.
C.M. Oliver officials do not want their former client who is unacceptable to exchange officials. Jim Ross, vice-president and branch manager, failed to return calls about whether any court dates for the matter had been set.
Complicating matters is another Calgary-based company named Stock Watch -- this one called Stock Watch Inc, which is listed in the Calgary phone book. Oddly, the woman who answers the number says "hello," rather than identifying the company, and is quick to direct callers to the Vancouver-based trade newspaper. Asked what kind of business Stock Watch Inc is involved in, the woman said: "I don't know. I answer the phone for a couple of companies and I know that there are hardly any phone calls for Stock Watch Inc, other than (the callers) are looking for some kind of company that deals with stocks."
After a few minutes, Stock Watch Inc director Gerald Sklar responded, stating emphatically that his company has nothing to do with the company that's named in the lawsuit with C.M. Oliver -- Stock Watch Ltd. Mr Sklar further states that Stock Watch Ltd was struck from the register of Alberta companies five or six years ago and that the spelling style of his company, Stock Watch Inc, is actually "Stockwatch Inc."
Says Mr. Sklar: "The Stock Watch they're into a fight with (C.M. Oliver) doesn't exist. It's been struck from the record for years. You'll run into the same thing every time. It's two words and it's "Ltd," not "Inc". It's a different Stock Watch and it doesn't have anything to do with me. I'm only pissed at you guys because you wrote that I was the undesirable individual with Rio Sun and the VSE and that was bullshit."
Mr Sklar, who thinks he is quite desirable, has been in trouble in BC for issuing misleading press releases. He did not explain how the long defunct company happened to be selling hundreds of thousands of Interlock shares in 1994.
The Alberta Corporate Registry does not agree with Mr Sklar about Inc. It names two directors: Gerald E. Sklar and, yes, Thomas P. Devlin. Asked if he is associated with Mr Devlin, Mr Sklar stated: "No (but) I know Tom . . . extremely well. I get dragged into this, I don't know how." Asked if Mr Devlin is a director of Stock Watch Inc, he says "No. Never has been in a million years." According to the registry, Stock Watch Inc, which was incorporated as 656572 Alberta Ltd on June 6, 1995, changed its name to Stock Watch Inc on March 5 1996, and the name separates Stock from Watch.
Mr Sklar adds that his Stock Watch Inc (the good Stock Watch) is a "little private company. We've got an office, I do my own investments. We don't deal with anybody else. We pay our rent, we pay our bills, we show a modest profit."
The register of companies also indicates that as of May 20 at 10:42 am, the modestly profitable little Stock Watch Inc, with directors Sklar and Devlin, was in default for filing financial information for 1996.
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