Saturday, October 10, 2009

Sponge Bob Stock Scam

You would think that a company with a brand as valuable as the delightfully goofy Sponge Bob Square Pants would be argus-eyed when it came to protecting the integrity of their brand.

If they decided to license the image to, say, a pump-and-dump stock scam run by career criminals you might expect them to do minimal due diligence on the licensee, particularly if they were alerted several times by a pesky blogger of their lapse in judgment.

If you thought that of Viacom you would, of course, be dead wrong.

Spongetech, a criminal enterprise disguised as a penny-stock, has made much of their license to produce and market Sponge Bob children's bath sponges pre-filled with soap, so much in fact that they went to the trouble of lying about the product's inclusion in the special WalMart 10th anniversary Sponge Bob product display. Since WalMart does not carry SpongeTech products, the product was a no-show.

Bath and carwash sponges are not the only sponge fixation of Sponge Tech President Steven Moscowitz. He also owns Vanity Events, which featured in a now-scrubbed website, sponges pre-loaded with male desensitizing creme, and a variety of other sexual aids, not products normally associated with the Nickelodean demographic.

The long and short of it is that Viacom allowed its Sponge Bob brand to play a starring role in a sleazy penny stock promotion that by any reasonable estimate sold over $200 million in worthless shares to the investing public. Spongetech is now suspended from trading, is under investigation for fraud by the Securities and Exchange Commission, and faces a class action shareholder lawsuit alleging theft by deception.

But I guess as long as the licensing fees and royalties are paid on time, that isn't Viacom's problem. Call it the Mr. Crab approach to money.

Monday, October 5, 2009

The Sound of One Hand Clapping

Spongetech (OTCBB SPNGE) today was handed a ten day trading suspension by the SEC, effectively ending one of the more elaborate and successful OTC pump and dump scams in recent history. Last week the company announced that had been notified by the SEC of the opening of a formal investigation, which almost always leads to SEC litigation being filed.

Both of these are good things, so why is only one hand clapping?

This is why: the SEC was notified in mid May of complaints from the Transfer Agent, Old Monmouth, and from former SPNG attorney Joel Pensley, both referencing Spongetech's widespread use of forged, and in some cases totally fabricated opinion letters allowing their (unregistered) shares to be free trading. When we obtained the documents in question, including a transfer agent report that documented SPNG's consistent public lies about their outstanding share count, we also sent a query to the SEC, using slightly more temperate language than is our habit.

Since the SEC was originally contacted, over two billion new unregistered shares have been issued and sold to the investing public, such sales being abetted by Company fabricated claims of sales and earnings, and a veritable army of paid (and undisclosed) stock promoters. At a conservative $0.10 per share price assumption, that represents $200 million stolen from the public based on documented forgery, counterfeiting, and lies that the SEC was informed about months ago. Since there were several promotion backed runs of the share price to over $0.20, the total theft may be far higher.

Our favorite message board IHub played a major role in the promotion scam. Despite IHub's head, Matt Brown being criminally indicted on multiple felonies related to stock fraud and money laundering, IHub followed their standard pattern of assigning paid promoters to "moderate" the message board and to prevent negative information from getting to the rapidly developing cult who came to believe that they had found the key to instant wealth.

The notable head board censor went by the name Soapy Bubbles. In addition to providing censorship services he also filled the intertubes with private messages and e-mails touting the stock and claiming insider information.

Our friend soapy was a paid shill, and touted the stock in blatant violation of SEC disclosure requirements.IHub and parent UK based ADVFN as usual can neither hear nor see evil when it comes to the use of their service to violate the law and rape the naifs who fall for these scams.

We suspect that the SEC was prodded a bit by a services of NY Post articles by reporter Kaja Whitehouse that further documented SPNG's forgery and financial fraud. Add on stories by Roddy Boyd, and Greenberg of may have also helped. Even David Patch, normally the most wild-eyed of the Naked Short wing-nuts took up the cause of exposing this egregious fraud.

So one hand clapping is what the SEC gets. A trade suspension is one of the most powerful weapon in the SEC's arsenal that can be used against penny stock scams, and is used far to rarely. A more aggressive SEC stance could stop most pump and dump promotions-which are painfully easy to spot-dead in their tracks and banish the stocks to the illiquid wilderness of the Gray Market. The agency had sufficient evidence for a suspension in their hands since mid May, five months and two hundred million investor dollars ago.

One hopes the magnitude of this scam crosses the threshold for DOJ involvement and criminal prosecution. One also hopes that just for kicks the agency will broaden the investigation to include promoters, IHub and its censorious board moderators/shills, and the complacent new Transfer Agent.

The SEC didn't drop this ball, but they sure took too long to pick it up.

Monday, August 10, 2009


Wow. Gosharottie We sure are impressed with Ms. Shapiro's new get tough policy toward corporate miscreants.

Her new lap, er, watchdog breathlessly announced this week that they had fined big bad GE $30 million dollars for lying in their financial statements filed with the SEC. For those of you that don't know, that is a felony.

The stockholders, who had zippo to do with the blatant fraud, will pay the fine.

GE executives, who received over one billion dollars in bonuses during the days of fraud will pay

Not a fucking penny.

That makes sense.


Meet the new limp dick; same as the old limp dick.

Tuesday, August 4, 2009

Why Rob Banks when you can sell Penny Stocks

We Fucking Give Up
I mean really. We fucking give up.
The SEC Director of Enforcement has had, in his fucking face, evidence of massive stock fraud in the Penny Stock fraud SPNG. And he has had it for months.
During that time investors have been ripped off for over $100 million, mostly astonishly stupid 20 somethings.
Bullshit. And fuck you dear SEC enforcer. You are part and parcel of the problem, hunnybunch.
floyd norris
gary weiss
carol remond
sec inspector general

Friday, July 24, 2009

Why rob banks when you can sell penny stocks?

A Scam In Plain Sight
I don't know about you, but with the fresh new breeze blowing through Ms. Shapiro's SEC I can sleep better at night knowing that our tireless government watchdogs are busy protecting the public from con artists stealing tens of millions of dollars in penny stock scams.
Or not.
Spongetech is a crappy little OTC-BB company that has hired every stock promoter known to man (or woman) to hype its unlikely path to shareholder wealth-soap loaded sponges to wash your car, your pet, and your kid. While they have spent a fair amount of money advertising the product in unlikely venues such as baseball games, they have spent far more hiring an army of touts to spam and message board carpet-bomb the hype. IHub, scam promoter for the world, is front and center in the lineup of unisclosed paid shills despite the criminal indictment and arrest of its founder, Matt Brown, for just such manipulation.
Well, the SEC is busy with Madoff and Stanford, so maybe they overlooked this one, eh?
Or maybe they are the same torpid bureaucrats who were nurtured under Commissioner Cox.
The SEC has had in their possession since mid-May of this year the following damning documents related to Spongetech:
  1. A letter from an attorney claiming that his name had been fraudlently forged on scores of opinion letters avowing that Spongetech shares were free of restrictions and could be traded on the open market. In said letter the attorney also describes what any reasonable person would interpret as an attempt by Spongetech's CEO to bribe him.
  2. A letter from an attorney representing the company's former transfer agent, Old Monmouth, stating that they had relied upon opinion letters that were later found to be forged.
  3. A letter from a mythical New York law firm used to create "legal opinions" as to the lack of restrictions on shares.

In addition, the SEC has received documentation of a massive dilution of unregistered shares sold into the market in direct contradiction of company claims in its most recent SEC filings.

Despite having this documentation of blatant fraud for three months, your fearless regulators have taken no action, and during those three months over a billion unregistered shares of the company have been sold to the public at prices ranging from a dime to close to thirty cents. Do the math.
What is it those SEC folks do all day?

Tuesday, July 14, 2009

Why rob banks when you can sell penny stocks?

Dead Fish on a Silver Platter

Being a public spirited citizen I am passing on a deep insight that should make the SEC's job of policing markets easier for them: go to; read the "top ten" stocks being discussed; they are all odds-on scams.

Number one in the listing for several months has been Spongetech (OTCBB SPNG), a cash poor penny stock that claims to be selling tens of millions of dollars worth of soap impregnated sponges, and whose fanatical message board following believe will soon be a billion dollar company.

I will not belabor the company's dubious financial figures, its gagged transfer agent, or the fact that over 90% of its claimed sales are to companies of questionable existence.

Why go to all that hard work when there is clear and convincing evidence that the company has forged an attorney's signature on opinion letters opening new stock to free trading status, constructed a fictional New York City law firm for yet other opinion letters, and gotten dumped by their former transfer agent because of these actions.

The SEC would be on this one like a duck on a junebug if they only knew, right?


The SEC has had hard documentation of these facts in their possession since May 15, 2009, since which time clueless investors have lapped up BILLIONS of questionably registered shares at prices ranging from ten to twenty cents per share. Not Madoff level, but not chump change either.

Some stock fraud cases are tough to make. This is a slam dunk that a Summer intern could handle.

But from the Federales?


UPDATE-We now have hard confirmation that Spongtech, despite claims of a share buyback, has outstanding shares in excess of 2.2 billion, several hundred million of them newly minted in June and distributed to insiders and promoters.


Tuesday, June 9, 2009

The Slime Trail Continues

Investors Hub-No Shame

Head of one of your subs indicted for stock fraud with his band of punks and mafiosas; no prob. Being hammered on ADFN message boards? No prob, just close them down and threaten members with bans if they persist.

Undisclosed shills affiliated with the loathsome Tina Vasqez of Chapel Hill NC, who pumps her ass like a two bit whore with the fleet in town, spamming a new company on IFlub; no prob.

The latest pump by IFlub posters Rawnoc and Brig is a wannabe nuclear power company, Alternative Energy Holdings (stink sheets AEHI). The company's claim to fame is trying to con Elmore County, Idaho into rezoning 1,200 acres of land to allow them to construct a nuclear reactor.

AEHI hsd never built or operated a nuclear reactor. AEHI does not have the capital to build and operate a nuclear reactor. And AEHI shills lie out their ass.

Like the Rawnoc claim that AEHI has a $70 million commitment from Source Capital of Connecticut. Utter bullshit.

According to a Source Capital official, they have agreed to "assist" the scam in raising capital, "pending due diligence". "Scam" is my word, not Source's.

And according to an NRC spokesman, the last communication they had with this scam was a year ago, and the time from submitting a clean application to approval is 3 1/4 to 4 years. "Scam" is my word again.

At least one Elmore County commissioner has received threatening calls for her opposition to the project. Commissioners Rose and Shaw did not respond to telephone calls.

And now IFlub's Dave Lawrence is not only allowing board mod censorship of critics of scams, he is banning IP's of those who dare speak the truth.

They don't call him dirty dave for nothing.

Tuesday, June 2, 2009

Did IHub Pump and Dump Drive Miami Prosecutor to Violence?

Sure this is speculative, but I blog from my parents' basement in my PJ's, so I'm entitled.

Today's Miami News reports that veteran Dade County prosecutor David Ranck was suspended after an altercation with a pizza delivery lady resulted in his punching her out.

Now granted, and as anybody who has ever read a Carl Hiaasen novel knows, life in Mr. Flagler's city can be stressful on a good day, but what could possibly goad a proper, gated-community-dwelling public servant into attacking a pizza lady?

We think we know, and it wasn't the anchovies.

Despite criminal indictments of Investor's Hub founder Matt Brown and a gaggle of fellow scammers the site continues to be infested with a variety of pump and dump artists operating with seeming impunity.

Like the Chapel Hill based JTV Management and Consulting, LLC, of which the repulsive and undisclosed shill Tina Marie (tmstocks on IHub) is a principal.

One of her recent promotions took took the obscure, barely trading stink sheet Papa Bello's Enterprises to a volume of over a billion shares in a month, and a brief 50% increase in price, which of course subsequently collapsed. The hype was based on expansion of the pizza hawker via franchises and, of course, the fabulously obscure China market (do you know why cheese is not big in China? Most adult Asians are lactose intolerant). This is what a pump and dump looks like.

Standard IHub tactics in the illegal promotion are spelled out in Brown's indictment: wash trades, censorship of dissenting board posts, private messages purporting to have insider information, &C, and dear Tina, a board "moderator" was in the thick of it with her faithful companion shills "Rawnoc" and "Brig".

Clearly Ranck was sucked into the pump, and developed an irrational hatred for all things Italian. There is no other logical explanation for his behavior.

And there is no logical explanation for IHub parent company ADVFN allowing Brown to remain in his position, and to continuing to allow this slimeball message board to continue in the active pump and dump business.

cc SEC

Monday, June 1, 2009

Altomare Cert Denied

Fiat Indictments

The Supreme Court of the United States has denied the appeal of Richard Altomare, Scammer in Chief of the defunct Universal Express, an OTC BB company that stole over forty million dollars from investors.

Altomare is amazing in his arrogance, protesting to the end that a ten year old Bankruptcy Court ruling allowed him to sell 40 billion unregistered shares to investors based on absolutely fake claims about his non-existent business.

Well, Dick, it's over. End of the road. Last Train to Clarksville. &c.

If the DOJ has been shy about well deserved criminal indictments because of the pending SCOTUS appeal, then they need be shy no longer.

Come on, guys in South Florida. Altomare is an arrogant maggot of a gonif who has been giving you the finger for years.

Throw his ass in jail.

Thursday, May 28, 2009

Throw Jasper Knabb's Ass in Jail

Where are the Customer's Yachts?

The SEC yesterday published a fraud complaint against Jasper (Jay) Knabb as regards to manipulation of the stock of the now bankrupt Pegasus Wireless.

Good on the SEC, except it was four years after the fact, and nine years after the fact of Knabb's never mentioned and never punished BIFS Technologies fraud in 2000-2001.

As detailed in the SEC complaint, Knabb, his criminal wifey Tammy, and his partner Stephen Durland stole untold millions of dollars from the public from the illegal sales of the hyped Pegasus, which at one point made it onto the Naz National Market listings. The complaint details the friends, relatives, and mistress Knabb et. al. used to hide the illegal sales of the shares of the company, which at one point had a market capitalization of $1.5 billion and change.

Never ones to hide their lights under a basket, Knabb, Tammy-poo, and Durland were living large.

Jay-boy was featured in a fawning article with his yacht. Durland bought exotic cars, and Tammy-poo picked up a $1.5 million cabin outside of Anchorage AK. (hat tip to Seth Jayson for the boat and cars links, and to the Anchorage Daily News for the property report).

I'll just make a SWAG here, and say that Jay et. al., his crooked attorneys, and his paid promoters stole north of $100 million, not the paltry $30 million cited in the SEC complaint. And they are facing fucking CIVIL charges likely to be settled without admitting or denying guilt and fines that will never be paid? Maybe that pesky class action suit will cause them some problems. The document is long, but well worth the read if you are interested in a decade long history of corporate crime and regulatory coma.

Then there is the back story; had the SEC gotten off of their lethargic ass in 2000 when Knabb made his first-known foray into fraud, Pegasus might never have happened.

That story involved BIFS Technologies, an OTC-BB company shell headed by Alpha Keyser, still comfortably dwelling in his Longboat Key, Sarasota condo. BIFS (Biofiltration Systems) was a dormant shell whose business aspirations were to make it big in detoxing de-icing fluid at airports. Or something.

Taking a page from the Vertical Computer Systems playbook, Keyser conducted a 100/1 forward split of the company shares to lower the quoted price to pennies, and hired Orville Baldridge, a convicted Florida sex offender to "get this thing moving".

Enter Jasper, stage left, selling BIFS Beach Access, a small Myrtle Beach ISP, and promising the rights to SWOMI (Seamless Wireles Omnidirectional Internet), a revolutionary new wireless Internet technology that he claimed to have developed.

Hyped by this improbable claim, BIFS stock soared from pennies to over $2.00 per share, with both Alpha and Knabb happily selling into the surge. Although their relationship soured when it turned out that Jay-boy didn't actually own Beach Access and he was fired from his "executive" position, he nevertheless retained the twenty million shares paid to him for the acquisition. The revolutionary wireless technology turned out to be 811.a Wi-Fi. The SEC took no action, nor did they bother to investigate Knabb in his subsequent pump and dump scams, all of which were eerie clones of BIFS, and all of which made the lame claim of "naked shorting" for the poor performance of the companyies.

Enough, already. This gonif is a career criminal who has left a wasteland of investor losses in his wake. Maybe, just maybe the DOJ could take some time away from chasing phony terrorist threats, prosecute Jasper et. ux., and send them on vacation to Club Fed.

If they can find them. They seem to have gone missing.

Wednesday, May 27, 2009

ADVFN Comes a Cropper

ADVFN Comes a Cropper

Well, we finally heard from Clem of the mighty ADVFN, and what we got was...crickets.

No prob, according to Clem. Matt Brown, head of IHub indicted on criminal charges? Hey:

Just as in TV and Film , the public face of our products, be they in the US, the UK, Brazil, Italy or otherwise, get a disproportionate amount of attention, in the same way as a news presenter or a talk show host does on a TV channel. These profiles are all part of the product offering but they are not a pivotal business continuity issue. iHub is a community of smart, seasoned stock speculators that we feel is big enough to sit back and await the outcome of this situation without pre-judgement.

No prob, clem. Just because the head of your property has been scamming for years, and conspiring with others to do so using your IHub property, and finally got indicted, it's not to worry.

Yeah. Crickets.

Tuesday, May 26, 2009


Where are the Rest of the Bad Guys

By now any penny stock sleuth who hasn't spent the past few days in an Internet free zone is aware of the civil and criminal charges brought against, among others, Matt Brown, founder and chief moderator of the Investors Hub message boards. With one exception all named defendants have been arrested and released on bail ranging from $50,000 to $500,000. Polish national Pawel P. Dynkowski, named as key in the scheme cannot be located, and it is rumored that he has fled the country.

IHub has set up a message board for discussion of the event, and that board accounted for over 90% of total IHub messages over the long weekend. Not many of the posts were Brown-friendly.

Amazingly, ADVFN, the UK financial services company that purchased IHub in September of 2006,-well within the time that the DOJ and others allege that Brown et. al. were engaged in their criminal behavior- has made no public statement, and Brown still seems to retain his position. Somebody needs to tell the Brits how do deal with an existential threat to one of their properties.

This is an onion story that will have its layers peeled back at the speed of law. However, there are fairly obvious omissions from both the SEC and DOJ named defendants.

In the SEC complaint the scheme is described as follows:

...Defendant Pawel Dynkowski and his accomplices agreed to sell large blocks of shares for penny stock companies (or "issuers") in exchange for a portion of the proceeds. The issuers put these shares in nominee accounts that Dynkowski controlled. Dynkowski and his accomplices then pumped the market price ofthe stocks through wash sales, matched orders, and other manipulative trading, to give the market the false impression that there was real demand for these securities. They often timed this manipulative trading to coincide with false, misleading, and touting press releases from the issuers, which Dynkowski at times prepared himself. After artificially inflating the price of the stocks, Dynkowski and his accomplices then sold the shares they obtained from the issuers to the unsuspecting market. Dynkowski, his accomplices, and the issuers shared the illicit profits.

Although the investigation is described as continuing, rather obvious omissions from the first round of named miscreants are the penny stock companies themselves.

The four companies named gave stock to Dynkowski, Brown et. al. who manipulated the price and volume through wash trades, false and misleading press releases, and favorable posts on IHub message boards. The stock was then sold to the now-drooling suckers, and the proceeds split in some ratio with the issuers.

Hello. What is missing from this picture. Issuers actively participated in the alleged (but well-documented) scheme and shared in the illicit profits. Are they playing nice with the Federales to help build the case against Brown and friends? Will they get to keep their share of profits from the scheme (if they haven't blown them yet, as penny stock "CEO's" are wont to do)? Or are the SEC folks just too damn busy going after a geriatric stock manipulator's small time (and stupid) scheme to try and recover his $40,000 lost nest-egg? Time will tell, one supposes.

On a parenthetic note, I would be very, very conservative if I were stealing the $6 million that we know about. Matt and the Boyz, on the other hand, styled themselves like Medellin Cartel members out on the town in South Beach. Their choice was a lost weekend in Vegas in 2006 partying like rock stars. Matt's pictures of that trip posted on IHub have mysteriously disappeared.

More as developments unfold.

Sunday, May 24, 2009

Matt Brown: Felon


There are lots of scammers in the world, and sadly that's the damned truth.

Investors Hub is riddled with pump and dump artists, from rawnoc to tmstocks. It reeks of fraud.

And now Matt "we are a neutral forum" Brown, founder of the scam site has been named in multiple criminal indictments for using Investor's Hub to run pump and dump schemes in conjunction with his boy-toy and possibly the Mafia.

He and his boyz "only" stole six million or so, so what's the big deal?

Oh, gosh, violation of public trust, gross hypocrisy, and common theft leap to mind.

Amazingly, ADVFN, parent company of IHub has been silent, and Brown seems to retain his position at IHub. The boy-toy has gone missing, although a money laundering bust did force him to leave the LAMBO behind. We ache for his loss.

Word has it that mattie poo, named in a separate indictment, is singing his little heart out. Maybe the little fuckface can bargain his sentence down to five years. At thirty one when it ends he will have plenty of time to scam again.

And he will.

If you want all the gory details, they are here.