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Tag: cease-trade order

  • Man, 85, Accused Of Selling Unregistered Securities In ‘Shipwreck’ Venture; Recidivist Huckster Hawked Sunken-Treasure Offer While Banned Because Of Previous Misconduct, BCSC Says

    Ten years ago, when John Arthur Roche McLoughlin was about 75 years old, the British Columbia Securities Commission accused him of selling unregistered securities in a venture known as Grandby Development Corp., a purported fertilizer company.

    BCSC imposed a five-year ban that prohibited McLoughlin from acting as a director or officer of any issuer. Because McLoughlin did not meet the requirements to lift the ban, including paying a $25,000 assessment, the ban remained in effect, according to records.

    Now, at 85, McLoughlin has been accused of selling unregistered securities in a purported Irish venture in which investors were told they’d receive a share of treasure recovered from shipwrecks. The scheme, according to records, raised about $312,00 for the company, known as Blue Lighthouse Ltd.

    McLoughlin initially protested the $20,000 penalty BCSC sought to impose for his conduct in the treasure-salvaging venture, which he sold as an agent for Blue Lighthouse through a British Columbia firm known as MCL Ventures Inc., according to records.

    BCSC then increased the penalty by $30,000 and banned McLoughlin for 15 years. He next could seek to sell securities when he was approximately 100 years old, according to the ruling.

    “As McLoughlin engaged in the same misconduct for which he had previously been sanctioned and continued to breach the orders against him in spite of repeated warnings from BCSC staff, the panel increased the $20,000 fine sought by the commission to $50,000,” the agency said.

    BCSC also “cease-traded MCL Ventures Inc.,” the agency said.

  • BULLETIN: Now, A Multimillion-Dollar ‘Penny-Stock’ Scheme Operating On Facebook, Twitter; SEC Charges Two Canadians In ‘Scalping Scam’

    UPDATED 1:58 P.M. EDT (U.S.A.) The SEC has obtained an emergency order to freeze the assets of two Montreal residents, alleging they were pushing a penny-stock scheme through their website and on Facebook and Twitter.

    Named defendants in the alleged scheme were Carol McKeown and Daniel F. Ryan, whom the SEC described as a Canadian “couple.” The agency said it worked with the Quebec Autorité des marchés financiers (AMF), which also has obtained an emergency freeze, along with a “cease trade order.”

    The stocks were touted through a website known as PennyStockChaser.com, the SEC said. McKeown is 44; Ryan’s age was not immediately known.

    “As alleged in our complaint, McKeown and Ryan used all the modern methods to communicate with investors including the PennyStockChaser website, e-mail, text messages, Facebook, and Twitter yet failed to adequately communicate that their rosy predictions for touted stocks were accompanied by their sales of those very same stocks,” said Eric I. Bustillo, director of the SEC’s Miami Regional Office.

    The U.S. complaint is filed in U.S. District Court for the Southern District of Florida.

    McKeown and Ryan received millions of shares of touted companies through two corporations — Downshire Capital Inc. and Meadow Vista Financial Corp. — which also were named defendants, the SEC said.

    Both McKeown and Ryan were compensated for pumping the stock, while “PennyStockChaser simultaneously predicted massive price increases for the issuers, a practice known as ‘scalping,’” the SEC charged.

    “McKeown, Ryan and one of their corporations failed to disclose the full amount of the compensation they received for touting stocks on PennyStockChaser,” the SEC charged, saying that the couple and their corporations “have realized at least $2.4 million in sales proceeds from their scalping scheme.”

    The PennyStockChaser website was throwing a server error at the time of this post. Meanwhile, the Twitter site appeared to be locked. The Facebook site appeared to be operational, with a posted dated Sunday that blared, “How many newsletters put their money where their mouth is? PSC will be buying another 500,000 shares on Monday.”

    It was not immediately clear what stock the Facebook site was pumping Sunday because the link led to a page on the PennyStockChaser site that generated a server error.

    It has become somewhat common for scammers to use social-networking sites to hawk investment-fraud schemes and murky businesses. Some fraudsters even have claimed that the so-called autosurf “industry” in which purported “advertisers” get paid for viewing websites is a new form of social networking and that the autosurf sites are building on the success of brands such as Twitter, Facebook and others.

    Read the SEC complaint to see the names of some of the other stocks the agency says the defendants recently have pumped.