$600 Million Worth Of Air Wiped Out in Two Hours
also: OMVE and SRPX Give It Another Go
also: OMVE and SRPX Give It Another Go
For the second time in two weeks, someone else has managed to bring a scheme to the attention of the masses within a matter of minutes, after we've spent weeks screaming about it. Apparently we have some work to do in bringing our website to the attention of the public.
We spent almost three months showing the world that Legend Oil & Gas (LOGL) was a scam and a sideways Pump & Dump, and yet a series of articles published over a few days by SeekingAlpha.com, accomplished more to bring that scam to realization than we could. That company's share price is now down 60% from the levels we were warning at and is likely to disappear into oblivion. Unfortunately, there would have been fewer victims had more been paying attention to us.
On Thursday, private investor, George Sharp, issued a press release with respect to his lawsuit against another company we issued an advisory on last spring, namely, Writers' Group Film Corp (WRIT). Within that press release, Mr. Sharp identified several new defendants, including Amwest Imaging (AMWI) insider,
Phil Keuber, a well established participant in Pump & Dump schemes, as we, ourselves, have already established in past alerts. Mr. Keuber was/is a key player in both the WRIT and AMWI schemes, which also share or shared a Beverly Hills address and (according to Mr. Sharp) corporate counsel.
Within the content of his press release, Mr. Sharp attributed some of his research to this website. At least somebody was paying attention.
We contacted Mr. Sharp to discuss his press release with him, but he begged off, as his phone was ringing off the hook (yeah no kidding), and he didn't want to give us advance information before he gives the SEC a chance to talk to him about it, "if they so wish", and he publishes it on his own blog. He expects that his report will be available at noon ET Friday and promised to make himself available to us this weekend.
Mr. Sharp did let slip one juicy tidbit that we found interesting. AMWI President, Jason Gerteisen, has apparently known since Friday, December 2 that this press release was forthcoming. We couldn't get Mr. Sharp to elaborate.
A Pump & Dump doesn't get any more obvious than this. We told you in a November 18 alert that the company had $317 in the bank and yet through its 535,600,000 shares issued and outstanding carried at that time a $100 million market cap. We also showed you that just prior to the start of the PnD, every one of those 535.6 million shares were owned by company insiders Patrick Moore, Keuber, Gerteisen and 25 pals who bought stock @ 1/26 of a penny, in order to bring the number of shareholders up to the requisite number.
Interestingly enough, Mr. Sharp claims to have documents that prove that Keuber and his then associates owned almost every share of WRIT prior to that company's subjection to a Pump & Dump. Why are we not surprised? It seems likely that the AMWI PnD is a carbon copy of the WRIT scheme, although with more profits realized by the insiders and thus more victims amongst the public.
In our November 21 alert, we identified Phil Keuber as a habitual participant in PnD schemes and offered up Jason Gerteisen to be an Amway style peddler. Still the touts managed to bring the suckers along for the ride with projections of a $12 share price (a $6.4 billion market cap? really????) and this trash was brought up to a market cap of almost $744 million this afternoon, when the stock hit its high of $1.39, and in spite of the fact that the company has no money or revenues. Obviously, that share price was shakey at best, as the stock closed, just two hours after the 2:00pm ET press release @ .26, down 58% on the day and off 81% from it high of the day. We figure that Keuber and company missed out on selling as many shares at inflated prices as they had hoped.
In the meantime, OTC Markets has placed AMWI on Caveat Emptor (buyer beware) status, which it does "When there is a public interest concern associated with the company, which may include a spam campaign, questionable stock promotion, known investigation of fraudulent activity committed by the company or insiders, regulatory suspensions, or disruptive corporate actions." We'd assume that Mr. Sharp's press release has brought to light certain facts to the regulators.
It is important to note that neither Gerteisen, Moore or AMWI were implicated by Sharp in the WRIT scheme. The press release seems to effectively be an update of Mr. Sharp's lawsuit against WRIT with a not-so-veiled attempt at warning AMWI shareholders of a similar scheme by a mutually key participant.
The Pump & Dump on Omni Ventures (OMVE) continues today even as those who got in at the start of the current campaign, one month ago, are now down 40%. The situation is even worse for those who bought into the August scheme, as those shareholders are down 70%. And it's no wonder. According to OMVE's financial statements for June 2011 (the September financials are way overdue), the company has $9,556 in the bank but owes $636K. Revenues for the latest reported quarter were $22K resulting in losses of $133K. And yet with this meager business, the company still carries a market cap of $35 million. Can anybody explain this? We have a very bad feeling about why the latest financials are way overdue and would get away from this one as far and fast as possible.
Scorpex, Inc (SRPX) is another one that's giving it another shot today. The last, heavily promoted, multi-week promotion, was conducted back in July/August and created losses of 70% as the share price fell from the $2.00 range to its current 60 cent level. Even lower share prices should be expected as insiders head for the exits. The currently reported 206 million shares issued and outstanding still give this a market cap of $130 million, a little heady for a company with zero revenues but $800K in losses for the latest quarter. Even headier when you consider that the company has $6,800 in the bank and yet owes $1.1 million. Massive dilution is rampant as the share count increased by better than 30% over the previous quarter and we'd bet that trend continues.
Back to main page