The U.S. Securities and Exchange Commission on Monday suspended trading in the shares of Neuromama Ltd., saying it was concerned that manipulation had inflated the value of the unlisted company to $35 billion.

In an order published Monday, the SEC said it halted trading in the firm's shares until Aug. 26 out of concern that false information, including a claim that the company would have it shares listed on the Nasdaq Stock Market, was driving demand for its stock. Its value had quadrupled in the past four months, rising as high as $56.25 a share in over the counter trading.

The company's website claims that Neuromama.com is a "leader in technology, innovation & research" and urges investors to "learn how we're changing the world." The site says the company has partnered on projects with Mexico's Department of Culture, has developed a search engine and social network, and is seeking financing to build a casino and resort in Ensenada, a coastal city on the Baja California peninsula.

Neuromama hasn't disclosed annual financial results since April 2013, when it reported having total assets worth just $4,721 and was known as Trance Global Entertainment Group Corp. In a quarterly filing made nine months later, the company valued its assets at $18.2 million, most of which it attributed to a "library of entertainment assets" that it acquired in September. In separate correspondence with the SEC, the company said the entertainment assets included 65 Jazz Network TV shows "as well as a syndication agreement that includes Direct TV and Dish Network among other distribution channels."

The website says the company's advisory board is chaired by Steven Schwartzbard, who also goes by the name Vladislav Steven Zubkis. In an email, Mr. Zubkis blamed the SEC's action on "the pressure from short sellers" and said his attorneys were in contact with the SEC. He said Neuromama's stock price had surged because tech companies "carry high valuation."

"We are looking to cooperate and make sure thing is resolved," Mr. Zubkis said in a phone interview.

The SEC in 1997 previously sued Mr. Zubkis over claims that he illegally sold $10 million worth of shares in International Brands Inc. to investors and made fraudulent statements about the company's revenue and future stock price. A disclosure on Neuromama's website says he later spent five years in federal prison. News accounts show that prosecutors accused him of defrauding investors of more than $1.8 million related to a Las Vegas casino purchase and development of a storage facility.

Write to Dave Michaels at dave.michaels@wsj.com

 

(END) Dow Jones Newswires

August 15, 2016 21:25 ET (01:25 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.
DISH Network (NASDAQ:DISH)
Historical Stock Chart
From Feb 2024 to Mar 2024 Click Here for more DISH Network Charts.
DISH Network (NASDAQ:DISH)
Historical Stock Chart
From Mar 2023 to Mar 2024 Click Here for more DISH Network Charts.