Ordinary Perople Versus Corporate Bullies
1 year ago
Sunday, October 11, 2009
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.
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 thestreet.com 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.
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 thestreet.com 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
MEET THE NEW SEC:
SAME AS THE OLD SEC
SAME AS THE OLD SEC
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.
Not
Meet the new limp dick; same as the old limp dick.
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.
Not
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.
CC:
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:
- 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.
- 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.
- 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?
CC
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 InvestorsHub.com; 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?
Wrong.
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?
Crickets.
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.
cc: SECOIG
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?
Wrong.
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?
Crickets.
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.
cc: SECOIG
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