InvestSource latest SEC penny
stock fraud case in on-going hunt for fraudulent stock promoters
18, 2010 - (Tip Report) Los Angeles - The Securities and Exchange
Commission has levied [civil] penny
stock fraud charges against InvestSourceinc.com and site operator,
Songkram Roy Sahachaisere, 40, of Huntington Beach, Calif. in
the Fed's on-going investigation into online penny stock fraud.
SEC complaint, filed July 9, 2010 United States District Court
for the Central District of California in Los Angeles alleges
Sahachaisere heavily touted penny stock company stocks between
January 2008 to March 2009, sending over 450 email messages over
the time in question in its daily email newsletter, called the
"Daily Digest," and by posting company profiles on its
SEC claims "ROY" Sahachaisere generated over $276,000
in profit, which seems like small potatoes compared to others
who were charged earlier this year. Still, "the dollar amount
has nothing to do with it," says one Florida investigator.
"Mr. Sahachaisere was touting stocks illegally."
noted that InvestSourceinc.com is offline and that Mr. Sahachaisere
has not been charged criminally in the state of California, which
is odd considering the State Attorney General is quick to prosecute
where the press is showing interest in a topic.
for investsourceinc.com revealed that the website is no longer
online, though a cache search will reveal some of Sahachaisere's
focus of the SEC civil complaint was on the defendants' lack of
disclosure, noting that while investsourceinc.com did say that
it 'may' own stock in companies it promotes from time-to-time,
the SEC charged that Sahachaisere owned stock regularly and typically
sold those shares through its email newsletter campaign to unsuspecting
investors. So heavily did Sahachaisere tout penny stocks that,
according to the SEC complaint, over 24 million investors received
his email over the period in question outlined in court documents.
SEC's complaint charges InvestSource and Sahachaisere with violating
the antifraud provisions of the federal securities laws, Section
17(a) of the Securities Act of 1933 (Securities Act), Section
10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.
It also charges them with violating the antitouting provisions
contained in Section 17(b) of the Securities Act. The SEC's complaint
seeks permanent injunctions, disgorgement with prejudgment interest,
and civil monetary penalties against both defendants. In addition,
the SEC seeks penny stock and officer and director bars against
complaint focuses on seven specific penny stocks that defendants
touted in which, the SEC alleges, defendants made misleading statements
regarding the nature of their compensation on InvestSource's website
and in the promotional emails. The defendants also failed to disclose
that they were selling the very securities they were recommending
investors buy. According to the complaint, between April 2008
and March 2009, defendants sold over 5 million shares of these
seven clients through one or more of their approximately 36 brokerage
accounts, illegally reaping profits of at least $276,000.
companies named in the complaint were China Forestry (OTCBB: CHFY),
whose shares closed up more-than 60% Friday; FIMA, Inc. (OTC:
FIMA), of which Sahachaisere is the CEO (The Company's press releases
list him by his middle name, "Roy"); Heart Health (no
listing could be found) Praebius Communications (OTC: PRCM); Obee's
Franchise Systems (OTC: OBEE); Purespectrum, Inc. (OTCBB: PSRU)
and New World Gold (OTC: NWGC), formerly New Asia Gold, the latter
of which alarmed
PIPE financiers considering the Company had raised $2 million
through a PIPE offering in 2001, though the Statue of Limitations
of any criminal wrongdoing relating to that financing have expired
(lucky break). PIPE deals through unregulated hedge funds are
on the Fed's radar screen for criminal investigations. TipReport
covered NIR Group, where a principal of the fund was recently
arrested - further charges against NIR Group's principal may show
up shortly if the canary caged by the Fed's sings.
would like to give kudos to patrickpretty.com,
a blogger that rants on stock touts, for highlighting one of the
companies mentioned in the SEC complaint - Praebius Communications.
In his July 16 post, PP wrote: The timing of the alleged touting
scheme, according to records, coincided with dates in October
2008 in which AdSurfDaily, Inc. (ASD), an autosurf company, was
announcing a purportedly lucrative joint venture with Praebius.
blogger noted that ASD was under investigation at the time for
operating fraudulently. ASD owner, Andy Bowdoin, was not named
in the July 14, 2010 SEC complaint against InvestSourceinc.com
and "Roy" Sahachaisere. As to why "Pretty Pat"
would peel the scab off of Bowdoin's wounds may make one wonder,
but his point was well taken in providing an example of just how
[allegedly outlandish] Sahachaisere could be - its a wonder he
wasn't charged sooner!