SEC files charges against an alleged Pump and Dump Ring

[ronning]

Its actually quite amazing, Matt is being applauded on I-Crud for doing the honorable thing by pleading guilty!

I shake my head in dismay, the man is a crook who got caught ripping off people who paid him via subscriptions to his site. Why? Because he could.

The f**ker should be stripped, lashed and tossed down a mine shaft.

How about one in southern Utah?   

[Goldenbollox]

Its actually quite amazing, Matt is being applauded on I-Crud for doing the honorable thing by pleading guilty!

I shake my head in dismay, the man is a crook who got caught ripping off people who paid him via subscriptions to his site. Why? Because he could.

The f**ker should be stripped, lashed and tossed down a mine shaft.

[Goldenbollox]

http://www.viewer.zoho.com/docs/bFb7cj

THE COURT: I'm told that you want to plead guilty to Counts I, IV, V and VIII as set forth in the Indictment, is that correct?

THE DEFENDANT: Yes, your Honor?

THE COURT: All right.

Tell me what you did with regard to -- we'll start with -- we'll follow the Memorandum of Plea Agreement here. We'll start with Counts I and V that charges you with Conspiracy to Commit Securities Fraud.

Tell me what you did that makes you think you're guilty.

THE DEFENDANT: Myself and others agreed to take part in a scheme to manipulate the value of certain stocks that were publicly held corporations called GH3 and AAGH.

[tecch10000]

Dude.
This is awesome.
No doubt,we talked many many years ago.
And speculated.
This day would come.
ICrud!
Tooooooooooooooo Funny!
Being correct.
Is very important.

[Goldenbollox]

SEC target Riviello pleads guilty

2010-05-19 15:14 ET - Street Wire
See Street Wire (C-*SEC) U.S. Securities and Exchange Commission
by Mike Caswell
http://www.stockwatch.com/newsit/newsit_newsit.aspx?bid=U-s0130895-U%3AAAGH-20100519&symbol=AAGH&region=U

Marc Riviello, one of seven men charged in a pump-and-dump scheme that included Investors Hub operator Matthew Brown, has reached a deal with prosecutors. In return for a reduced sentence, he has agreed to plead guilty to a criminal charge of unlawfully transporting money.

Delaware prosecutors claim that Mr. Riviello, a broker from Atherton, Calif., participated in a pump-and-dump scheme that netted $6.2-million in illegal profits. (All figures are in U.S. dollars.) His co-defendants touted four companies with misleading news and posts on Investors Hub. The stocks included Playstar Corp., an Ontario pink sheets listing that purported to be developing a proprietary text message system for cellphones.

Mr. Riviello's role, according to a plea agreement dated April 27, 2010, was to relay money in the scheme. He withdrew $220,000 in cash from a Bank of America account in three separate transactions between Dec. 21, 2006, and Jan. 19, 2007. The money represented proceeds from the pump-and-dump of GH3 International Inc., a pink sheets company that claimed to be developing an anti-aging treatment. He gave the cash to one of his co-defendants, Joseph Mangiapane, who paid a driver $10,000 to take the money from California to Delaware. There it was distributed to Mr. Brown and others.

A sentencing date has not yet been set for Mr. Riviello, who faced a maximum of 10 years in jail and a $250,000 fine. He has been free on an undisclosed bond since his May 26, 2009, arrest. His guilty plea comes two months after Mr. Brown reached a deal with prosecutors, in which he admitted to pumping and dumping GH3 and another company, Asia Global Holdings Inc.

SEC's complaint

As part of his plea agreement, Mr. Riviello waived a formal indictment, which means that prosecutors will not be presenting the full charges that he would have faced at trial. These details can be found elsewhere though. On May 21, 2009, the U.S. Securities and Exchange Commission filed a parallel civil suit against him and the others for the scheme.

The complaint describes how the men manipulated four stocks in 2006 and 2007. Mr. Riviello's role was mostly with GH3, a pink sheets listing that rose from 0.04 cent to 1.8 cents in late 2006. That portion of the scheme generated fraudulent proceeds of $747,609, the SEC said.

It began on Oct. 30, 2006, when the company rolled back 1:20 and improperly issued 312 million free-trading shares, according to the complaint. The issuances relied on Rule 504, which is normally only available to accredited investors who do not plan to sell their stock. The SEC said the men then embarked on a manipulation that included several wash trades timed to coincide with misleading news releases.

The trades were carried out by Mr. Brown and another defendant, Delaware resident Pawel Dynkowski. The men simultaneously bought and sold millions of shares, making the stock appear far more liquid than it was, the SEC claimed. "As unsuspecting buyers were attracted to GH3 in increasing numbers, the stock's volume and ultimately its price continued to increase," the complaint stated.

The news releases, which came out around the same time, touted the company's revenues. One, dated Dec. 7, 2006, claimed that the revenues exceeded $2.1-million in 2005. The next day, the company issued another news release stating that the 2006 revenues exceeded $3-million. The stock rose from 0.7 cent to 1.8 cents on the news. (It now trades for 0.01 cent.)

The SEC said that Mr. Dynkowski and another defendant, Jacob Canceli, started dumping their shares over the next several days. Between Dec. 7 and Dec. 13, 2006, they sold all 312 million shares that they had received earlier. The proceeds from the sales went to Mr. Canceli, Mr. Brown, Mr. Dynkowski, Mr. Riviello and another defendant, Joseph Mangiapane, the SEC said. Mr. Riviello laundered a substantial portion of the money to help pay the others, according to the complaint.

The complaint also identified Mr. Riviello as having a role in another one of the pump-and-dumps, that of Asia Global Holdings. The company claimed to have the rights to the show "Who Wants to be a Millionaire" in China. According to the SEC, Mr. Riviello's co-defendants made $4.05-million dumping Asia Global after they improperly obtained millions of shares by relying on an S-8 offering, normally used for employee benefit plans.

Mr. Riviello's role was serving as a broker on accounts used by Mr. Brown and the others. According to the SEC, the men opened accounts in the names of nominees at the brokerage where Mr. Riviello worked, AIS Financial Inc., and deposited their shares there. Then, during the course of the promotion, Mr. Riviello accepted repeated sell orders from the men that were obviously part of the dump phase of a pump-and-dump, the complaint stated.

The SEC sought injunctions preventing future violations of the U.S. Securities Act, appropriate civil penalties, and disgorgement of profits against each defendant. It also sought permanent penny stock bans against Mr. Dynkowski, Mr. Brown and Mr. Canceli.

Mr. Riviello is the third defendant to plead guilty in the case. Another, Florida resident Gerard D'Amaro, changed his plea to guilty on March 11, 2010. The judge has not yet scheduled a sentencing hearing for any of the men.


http://www.stockwatch.com/newsit/newsit_newsit.aspx?bid=U-s0130895-U%3AAAGH-20100519&symbol=AAGH&region=U

[tecch10000]

SEC AMENDED COMPLAINT
http://sec.gov/litigation/complaints/2010/comp21463.pdf

3. The GH3 pump-and-dump scheme occurred between October and December 2006. Dynkowski orchestrated this fraud with Defendant Matthew Brown, who operates a penny stock website called InvestorsHub.com.

Brown introduced Dynkowski to Defendant Richard Bailey, an officer of GH3, and to Defendant Jake Canceli, a penny stock promoter who participated in the scheme.

Brown acted as a liaison between Dynkowski, Canceli, Bailey and Defendant Florian Ternes, the CEO of GH3.

Dynkowski and his associates used wash sales, matched orders, and other manipulative trading, timed to coincide with false, misleading, and touting press releases arranged by Bailey and Ternes at the company, to artificially inflate the price of GH3 stock.

Canceli provided the accounts from which Dynkowski subsequently sold purportedly unrestricted shares received from the issuer through Defendant Gary Heath, who Bailey and Ternes arranged to act as a conduit for the shares.

The scheme culminated in mid-December 2006, with Dynkowski dumping 312 million shares of GH3 stock for total proceeds of $747,609.

[Goldenbollox]

Everybody who is considering putting money into US penny junk should read this:-

http://sec.gov/litigation/complaints/2010/comp21463.pdf

[Goldenbollox]

U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 21463/ March 29, 2010
SEC v. Dynkowski, et al., Civil Action No. 09-361 (D. Del.)
SEC Files Charges Against Three Additional Individuals in Stock Manipulation Ring

The SEC announced that The Honorable Gregory M. Sleet, Chief Judge of the United States District Court for the District of Delaware, has authorized the SEC to file an amended complaint, alleging that three new defendants — Richard A. Bailey, Gary C. Heath, and Florian R. Ternes — each participated in the pump-and-dump scheme, described in the original complaint, involving GH3 International, Inc. during 2006. The amended complaint alleges that Bailey and Ternes, who were officers of GH3 at the time, made hundreds of millions of GH3 shares available, through Heath, to Pawel Dynkowski and other defendants to liquidate in the market once they had pumped the stock through manipulative trading and false, misleading and touting press releases. Bailey and Ternes shared in the scheme's proceeds of $747,609 and, when it was nearly over, sold almost a billion shares of GH3 on their own for proceeds of $272,000.

The original complaint alleged that Dynkowski and seven others had manipulated the trading in four penny stocks: GH3, Asia Global Holdings, Inc., Playstar Corp., and Xtreme Motorsports of California, Inc. They did so by pumping the stocks through manipulative trading (using washed sales and matched orders) and false or misleading press releases. They then dumped on the market billions of shares of unregistered stock that they obtained from the issuers. Together, these schemes reaped more than $6.2 million in illicit proceeds.

The amended complaint alleges that Bailey and Ternes violated Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder; and that Heath violated Sections 5(a) and 5(c) of the Securities Act. The complaint seeks against each defendant a permanent injunction against future violations, disgorgement of ill-gotten gains with prejudgment interest, civil monetary penalties, and orders barring them from participating in penny stock offerings.

The SEC thanks the U.S. Attorney's Office for the District of Delaware; the Department of Homeland Security, Immigration and Customs Enforcement; the Internal Revenue Service - Criminal Investigations; and the Delaware State Police for their assistance in this matter.

For further information, see Litigation Release No. 21053 (May 21, 2009).

See Also: SEC Complaint
 
http://www.sec.gov/litigation/litreleases/2010/lr21463.htm
Las

[Goldenbollox]

Delaware courts: Key cog in stock scheme admits role
Another plea expected in $6M scam

By SEAN O'SULLIVAN • The News Journal • February 18, 2010
http://www.delawareonline.com/article/20100218/NEWS01/2180341

WILMINGTON -- A key player in a massive, multimillion-dollar stock fraud that was operated through Delaware admitted in Delaware District Court on Wednesday to two counts of conspiracy to commit securities fraud and two counts of conspiracy to commit money laundering.

Matthew W. Brown, 27, of Aliso Viejo, Calif., who operated the Web site InvestorsHub.com, told Judge Joseph J. Farnan Jr. that he worked with others to fraudulently manipulate the price of certain stocks and then laundered the cash proceeds.

It was called a "pump and dump" scheme, in which conspirators work with officials from a targeted company to "pump up" a stock price -- with bogus press releases and manufactured stock activity and Internet buzz -- and then "dump" all their shares for a profit once a certain profitable level has been reached.

In court, Assistant U.S. Attorney Keith M. Rosen described Brown as the conduit between officials of at least two companies who were willing to participate in the fraudulent activity -- GH3 International Inc. and Asia Global Holdings Inc. -- and Pawel Dynkowski of Newark, who orchestrated the scheme.

Dynkowski, 24, has been charged but remains at large, according to prosecutors.

At least one other person involved in the scheme, which netted an estimated $6 million from 2006 through 2008, is expected to enter a similar plea in the coming weeks.

Outside court, Brown and his attorney, Michael J Amador, had no comment.

Brown faces up to five years in prison on each securities fraud count and up to 20 years in prison on each of the money laundering counts, in addition to potentially millions in fines when he is sentenced later this year.

According to court papers, GH3 was a Nevada business that purported to market anti-aging products; Asia Global, also based in Nevada, claimed to have the rights to the TV game show "Who Wants to Be a Millionaire" in China.

Rosen and Assistant U.S. Attorney Shannon Hanson said the conspirators, working with company officials, would coordinate the issue through positive press releases with manufactured stock activity to make it appear there was investor interest and activity.

They would also plant positive items about the company in investor chat rooms on the Internet and send out positive spam e-mails about the companies.

Contact Sean O'Sullivan at 324-2777 or sosullivan@delawareonline.com

http://www.delawareonline.com/article/20100218/NEWS01/2180341

[Goldenbollox]

February 17th, 2010, 2:07 pm ·
posted by Ronald Campbell
http://ocbiz.freedomblogging.com/2010/02/17/o-c-stock-board-founder-pleads-guilty-to-fraud/16849/

Matthew Brown, founder of Orange County stock board InvestorsHub.com, pleaded guilty today to four counts of stock fraud and money laundering. He faces up to 20 years in prison and a $500,000 fine. Brown entered his plea in U.S. District Court in Delaware.

Federal prosecutors charged Brown and six others with a pump-and-dump scheme to hype five lightly traded stocks on InvestorsHub, drive up the price and then sell. In his plea agreement, Brown admitted that investors lost at least $1 million because of his scheme.

Prosecutors said Brown and the others arranged with help from insiders to gain control of millions of shares in the target companies. Then they spread glowing rumors on InvestorsHub and other stock boards, prompting unwitting buyers to rush in. Then they sold.

A key figure in the case, Polish citizen Pawel Dynkowski, also known as “Evo”, remains at large, Assistant U.S. Attorney Shannon Hanson said.

Another defendant, Gerard D’Amaro of Lighthouse Point., Fla., is scheduled to change his plea from innocent to guilty on March 11, Hanson said.

Since the original indictment of Brown, Dynkowski, D’Amaro and two others last May, a federal grand jury indicted two more alleged participants, Florian Ternes and Richard Bailey. They were insiders at one of the target companies, GH3 International, and allegedly arranged to provide 312 million shares for the scheme.

Read Brown’s plea agreement here.
http://ocbiz.freedomblogging.com/files/2010/02/Brown-plea-2010-02-171.pdf

Read our May 2009 coverage of the first indictments and Securities and Exchange Commission lawsuit here.
http://ocbiz.freedomblogging.com/2009/05/21/oc-stock-board-founder-broker-indicted-for-fraud/12005/

http://ocbiz.freedomblogging.com/2010/02/17/o-c-stock-board-founder-pleads-guilty-to-fraud/16849/

[Goldenbollox]

2009-12-31 14:20 ET - Street Wire
By Mike Caswell
http://www.stockwatch.com/newsit/newsit_newsit.aspx?bid=Z-C%3A*SEC-1677424&symbol=*SEC&region=C

The U.S. Securities and Exchange Commission
has belatedly halted GH3 International Inc., a pink sheets company that Investors Hub operator Matthew Brown and others allegedly pumped and dumped. In an order dated Dec. 24, 2009, the SEC says that publicly available information about the company is questionable. For the protection of investors, the regulator is halting the stock.

According to Delaware prosecutors, GH3 was one of four companies that Mr. Brown and others promoted with misleading news releases and postings on Investors Hub in 2006. The other stocks cited by prosecutors included Playstar Corp., an Ontario company that claimed to be developing a proprietary text message system for cellphones. Mr. Brown pleaded not guilty to the charges on June 24, 2009, and is free on a $50,000 bond. (All figures are in U.S. dollars.)

Brown's indictment

Prosecutors unsealed an eight-count indictment against Mr. Brown, 26, on May 21, 2009, in the District of Delaware. They charged him with eight counts of fraud, mostly for pumping and dumping GH3 and another company called Asia Global Holdings Corp. According to the indictment, Mr. Brown and others misused Regulation D offerings to obtain hundreds of millions of non-registered shares in GH3. They then had the company issue misleading news releases, claiming that its revenue in 2005 and 2006 exceeded $2.1-million and $3-million, prosecutors said. The company was touting an anti-aging product.

While the indictment contained little information on the GH3 dumping, it did describe transactions in which Mr. Brown and others arranged to transfer hundreds of thousands of dollars in proceeds from the scheme. In one such transfer, Mr. Brown paid $10,000 to have somebody drive $146,000 in cash from California to Delaware. The indictment also listed a series of wire transfers and cash withdrawals, totalling $693,000, which prosecutors said represented money from GH3 share sales.

In addition to the GH3 allegations, the indictment partly described the Asia Global pump-and-dump. The company claimed to have the rights to broadcast the show "Who Wants to be a Millionaire" in China. Prosecutors said that Mr. Brown received instant message communications about the timing of the promotion. The indictment quoted several, including one dated Nov. 1, 2006, which stated, "u have all the prs [press releases] right, except the first one, which im going to work on tomorrow for sure, we need a plan on line up of events and i need to see the damn prs to see which rumor to spread and how to start the damn thing ... ." Another, dated Sept. 1, 2006, stated that the company should "do [a] bigger S-8, 25 [million] shares instead of 15 and we'll sell it all extra 10 [million] ... ."

Prosecutors said Mr. Brown had previously received instructions on how to prepare Asia Global's news releases. These included an instant message on Aug. 24, 2006, telling him to "make it sound good like AAGH announces record revenue net profits increase of 300% etc."

According to the indictment, he and others directed the buying and selling of 24 million shares of the company between Feb. 1 and Feb. 13, 2007. In those two weeks, the stock traded between five and seven cents, and had average daily volume of 12.1 million shares. It closed at 0.25 of a cent Wednesday.

The indictment also accused Mr. Brown of helping set up an offshore account for one of his co-conspirators, Pawel Dynkowski, in Costa Rica. The purpose of the account was to help Mr. Dynkowski hide the proceeds from the Asia Global market manipulation. Prosecutors said the men travelled to Costa Rica on Oct. 31, 2006, and opened the account. In a subsequent instant message, Mr. Dynkowski said his "set up is now 100% sec safe."

Mr. Brown's co-conspirators, who were separately indicted, are Pawel Dynkowski, 24, of Delaware; Joseph Mangiapane, 43, of California; Marc Riviello, 50, of California; Jacob Canceli, 50, of California; Gerard D'Amaro, 38, of Florida; and Angelo "Bill" Panetta, 48, of California. All of the men have pleaded not guilty to the charges, and await trial, except Mr. Dynkowski, who has not yet entered a plea.

In addition the criminal charges, the men are facing a parallel civil suit filed by the SEC. That case is in hold, pending the outcome of the criminal cases.

GH3 International

The SEC's halt of GH3 will last for 10 business days, ending on Jan. 8, 2010. Unlike halts in Canada, those issued by the SEC place an onerous burden on brokers wishing to trade the stock even after it resumes. They must keep up-to-date information on the company's financial status and on its insiders. They must also have copies of the company's prospectus, its most recent annual report
and any subsequent quarterly reports. In addition, brokers must maintain current information on the company's name, address, state of incorporation, number of shares outstanding, the name of its transfer agent and the nature of its products. Brokers must also know if a price quotation is from another broker or from an insider. They must provide this information to anyone interested in trading the company.

GH3 has been inactive since December, 2006. The stock, which traded at 1.4 cents in 2006, last traded at 0.01 of a cent.



http://www.stockwatch.com/newsit/newsit_newsit.aspx?bid=Z-C%3A*SEC-1677424&symbol=*SEC&region=C

[tecch10000]

iHub subscription prices will increase on January 1, 2010....but you can lock in current rates, today!

This to pay for Matt Brown's rising legal costs 

Just goes to show you.
Proof Positive!
Stupid People will pay More Money!
For Turds!
Suckers!
Tooooooo Funny!
Tell 'em again P.T.!
They did not hear you the first time.

[Goldenbollox]

iHub subscription prices will increase on January 1, 2010....but you can lock in current rates, today!

This to pay for Matt Brown's rising legal costs 

[tecch10000]

Uh Oh Matt 

 

Pacer Update 24 Nov 09 USA v. Matthew W. Brown CRIMINAL DOCKET FOR CASE #: 1:09-cr-00046-JJF

Date Filed # Docket Text

11/24/2009 22 ORDER Granting 21 Joint MOTION for Extension of Time to File Pretrial Motions filed by USA. Pre-Trial Motions due by 12/28/2009., Status Report due by 12/28/2009. ORDER TO CONTINUE in the Interests of Justice as to Matthew W. Brown. Time excluded from 11/23/2009 until 12/28/2009. Signed by Judge Joseph J. Farnan, Jr. on 11/24/2009. (nms) (Entered: 11/24/2009)

[tecch10000]

Hahahahahaha!
Defense attorney arrested on felony charges!

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=44059937