scion
5 years ago
SEC Charges Four in Fraudulent Microcap Manipulation Scheme Orchestrated Through International Accounts
SEC Complaint
https://www.sec.gov/litigation/complaints/2018/comp24361.pdf
Litigation Release No. 24361 / November 28, 2018
Securities and Exchange Commission v. Morrie Tobin et al., Civil Action No. 1:18-CV-12451 (D. Mass. filed November 27, 2018)
The Securities and Exchange Commission charged four individuals for their roles in a scheme to profit from the manipulation and illegal sale of stock of two publicly traded companies, Environmental Packaging Technologies Holdings, Inc. and CURE Pharmaceutical Holding Corp.
According to the SEC's complaint, Morrie Tobin, a California resident, worked with co-defendants Milan Patel, Matthew Ledvina, and Daniel Lacher to facilitate Tobin's scheme. Patel and Ledvina, attorneys at an international tax law firm, and Lacher, a resident of Switzerland, allegedly hid Tobin's ownership and control over the companies by using offshore entitites to hold his stock and by establishing accounts to sell that stock at Wintercap SA, a Swiss-based company run by U.K. citizen Roger Knox. On October 2, 2018, the SEC filed an emergency action and obtained an asset freeze against Knox and Wintercap, charging them with a scheme that generated more than $165 million of illegal sales of stock in at least 50 microcap companies.
The SEC's complaint charges that to maximize profits from the alleged scheme, the defendants arranged to pay a stock promoter to tout the stock of Environmental Packaging while creating the impression that the recommendation came from a neutral third party. Environmental Packaging shares more than doubled, from approximately $1.05 per share to $2.21 per share, during the promotional campaign. Patel, Ledvina, and Lacher allegedly planned to collect a percentage of the proceeds from the unlawful sales.
According to the complaint, after the SEC halted trading in the securities of Environmental Packaging on June 27, 2017, the defendants took steps to obstruct the SEC's investigation - and conceal their own involvement in the matter - by arranging to change the names listed on Wintercap account records.
The SEC's complaint, filed in the U.S. District Court in the District of Massachusetts, charges Tobin, Patel, Ledvina, and Lacher with violating various federal securities laws, including the antifraud provisions of Sections 17(a)(1) and (3) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rules 10b-5(a) and (c) thereunder, and the securities registration provisions of Sections 5(a) and (c) of the Securities Act. The SEC seeks a permanent injunction against future violations, disgorgement of allegedly ill-gotten gains plus prejudgment interest, penny stock bars, and monetary penalties.
The SEC's case is being handled by J. Lauchlan Wash, Trevor Donelan, Eric Forni, David Scheffler, Rebecca Israel, Jonathan Allen, Kathleen Shields, and Amy Gwiazda of the SEC's Boston Regional Office, in coordination with the Enforcement Division's Microcap Fraud Task Force. The SEC appreciates the assistance of the FBI and the U.S. Attorney's Office for the District of Massachusetts, the Financial Industry Regulatory Authority (FINRA), the British Columbia Securities Commission, the Ontario Securities Commission, and the Malta Financial Services Authority.
https://www.sec.gov/litigation/litreleases/2018/lr24361.htm
Big Brother
5 years ago
8K and PR out
https://www.otcmarkets.com/filing/html?id=13027257&guid=I9rMU6RzK-rY_3h
NEWS RELEASE Symbol: TSX-V: BLUE.P
October 29, 2018
For Immediate Dissemination
UPDATE ON QUALIFYING TRANSACTION WITH SPECIALTY LIQUID TRANSPORTATION
VANCOUVER, BC , Blue Bay Capital Inc. (TSX-V: BLUE.P) (“Blue Bay” or the “Company”) , is pleased to announce that the closing of its qualifying transaction with Specialty Liquid Transportation Corp. (“SLT”) is expected to occur on or about October 30, 2018.
Pursuant to the transaction Blue Bay will issue a total of 10,750,000 post-consolidated common shares and 79,250,000 Class B restricted voting shares to acquire 100% of SLT. SLT will on closing hold 100% of Environmental Packaging Technology, Inc., a manufacturer of flexible liquid transportation tanks. In connection with the closing of the qualifying transaction the Company will consolidate its currently issued share capital on a 2 existing shares for each one new share basis. In addition the Company will on closing change its name to Specialty Liquid Transportation Corp. and in connection with the name change has reserved the trading symbol “SLT.V”.
Additional information on the transaction can be found in the Blue Bay Filing Statement dated August 28, 2018 available at www.sedar.com, and in the news release of Blue Bay dated August 29, 2018.
Blue Bay anticipates that it will, on closing of the qualifying transaction, issue the following securities pursuant to completed and pending financing transactions (all dollar amounts in CAD):
?3,017,500 shares of the Company on conversion of convertible debentures issued by SLT pursuant to a financing for proceeds of $1,207,000. The holders of the convertible debentures will also hold share purchase warrants entitling them to acquire on exercise up to 3,107,500 shares of the Company. Half of the warrants can be exercised to acquire an additional share at a price of $0.55 for a period of two years from closing, and the remaining half can be exercised to acquire an additional share at a price of $0.45 for a period of 18 months from closing;
?2,750,000 shares of the Company pursuant to the conversion of convertible debentures issued by SLT pursuant to a financing for proceeds of $1,100,000. The holders of the convertible debentures also received warrants entitling them to acquire on exercise up to 1,875,000 shares of the Company at a price of $0.55 for a period of two years from closing; and
?5,791,375 units of the Company pursuant to a brokered private placement of units of the Company and its subsidiary (the “Offering”) for gross proceeds of $2,316,550, based on current subscriptions received, but subject to closing of the financing. Each unit will consist of one post-consolidated share and half of one share purchase warrant. Each whole warrant can be exercised to acquire an additional share at a price of $0.55 for a period of two years from closing. In connection with the private placement the Company will pay commissions of 7% in cash and 7% in broker warrants (3.5% cash and 3.5% broker warrants in respect of investors on the president’s list) to a syndicate of agents led by PI Financial.
The above financing transactions would on closing represent aggregate gross proceeds of $4,623,550 raised in connection with the qualifying transaction. The twelve month allocation of available funds on closing of the qualifying transaction is currently estimated to be as follows (actual use of funds may vary):
? Expansion of the existing manufacturing facility ($500,000)
? Reduction of payables and debt ($1,500,000)
? Balance of transaction Costs ($250,000)
? General and Administrative Costs ($1,400,000)
? Unallocated funds ($566,550)
-1-
BLUE BAY CAPITAL INC.
Suite 610 - 700 West Pender Street
Vancouver, B.C. V6C 1G8
SLT has also reached agreements to exchange $2,425,000 of term notes held by noteholders of Environmental Packaging Technology, Inc. (“ EPT ”) into convertible debentures. The convertible debentures will on closing of the qualifying transaction entitle the noteholders to convert their debt into up to 6,062,500 shares of the Company (assuming the conversion of all such convertible debentures) at the rate of $0.40 per share. The convertible debentures become due on November 30, 2019 if not converted prior, and will bear interest at the rate of 10% per annum.
About Specialty Liquid Transportation Corp.
SLT holds an agreement to acquire 100% EPT, a Delaware company, through a share exchange to be completed concurrently with the closing of the Transaction. EPT delivers high quality and safe bulk packing solutions for transport of non-hazardous liquid in the Flexitank logistics industry. EPT’s patented Big Red Flexitank and patent pending Liquiride TM Flexitank enables customers to significantly reduce shipping costs, increase efficiency and minimize environmental impact as all EPT Flexitanks are recyclable. The Liquiride TM Flexitank is the only known product that can guarantee temperature control with use in refrigerated containers. The Company will provide additional information on the business of EPT by subsequent press releases to be issued in the near future.
Trading Halt
In accordance with Exchange policies, Blue Bay shares are currently halted from trading and may remain halted until completion of the Transaction.
Conditions to Closing the Transaction
Closing the Transaction is conditional upon, among other things, receipt of all required regulatory, corporate, and third party approvals, including Exchange approval, the negotiation and execution of the Definitive Agreement, completion of the acquisition of EPT by SLT, and concurrent completion of the Offering.
In addition to other prospectus exemptions commonly relied on in private placements, the Offering was made available to certain subscribers in British Columbia, Alberta, Saskatchewan and certain other Canadian jurisdictions where permitted by regulation, that have obtained advice regarding the suitability of the investment from a registered investment dealer. In accordance with the requirements of the applicable provincial regulations for the investment dealer exemption, the Company confirms that as at the date of this news release there is no material fact or material change related to the Company that has not been generally disclosed.
-2-
BLUE BAY CAPITAL INC.
Suite 610 - 700 West Pender Street
Vancouver, B.C. V6C 1G8
For further information, please contact:
Rana Vig, CEO
Telephone: 604-218-4766
Completion of the Transaction and the Offering is subject to a number of conditions, including but not limited to, Exchange acceptance. There can be no assurance that the Transaction and the Offering will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the transaction, any information released or received with respect to the transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.
The TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. The information in this news release includes certain information and statements about management’s view of future events, expectations, plans and prospects that constitute forward looking statements. These statements are based upon assumptions that are subject to significant risks and uncertainties. Forward looking statements in this news release include, but are not limited to, the closing of the Transaction and the anticipated benefits of the Transactions. Because of these risks and uncertainties and as a result of a variety of factors, including with respect to the closing of the Transaction, the closing of the Offering, the timing and receipt of all applicable regulatory, corporate and third party approvals, the anticipated benefits from the Transaction and the satisfaction of other conditions to closing the Transaction, the actual results, expectations, achievements or performance may differ materially from those anticipated and indicated by these forward looking statements. Although the Company believes that the expectations reflected in forward looking statements are reasonable, it can give no assurances that the expectations of any forward looking statement will prove to be correct. Except as required by law, the Company disclaims any intention and assumes no obligation to update or revise any forward looking statements to reflect actual results, whether as a result of new information, future events, changes in assumptions, changes in factors affecting such forward looking statements
or otherwise.
The securities of the Company have not been and will not be registered under the United States Securities Act of 1933, as amended and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirement. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
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