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Fri, 11-10-2006, 04:25 PM
| #71 (permalink) |
| Realist,/Moderator!!!  Join Date: Dec 2005 Location: My feet!!!
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  | Conversion Solutions asset assigned by alleged scammer Conversion Solutions asset assigned by alleged scammer 2006-11-10 13:11 ET - Street Wire by Lee M. Webb Stockwatch > News > News Item... Conversion Solutions Holdings Corp.'s touted $310-million Uniform Commercial Code (UCC) security note was assigned to one of the company's precursors, Waatle Holdings Corp., by alleged Mad Dog Builders Inc. fraudster David A. Hawkins, Stockwatch has learned. (All amounts are in U.S. dollars.) Mr. Hawkins, a 67-year-old resident of the Seattle, Wash., area and 71-year-old lawyer Harry Skeins from Blanco, Tex., were arrested in May and indicted for conspiracy and wire fraud in connection with an allegedly fraudulent mortgage scheme on Aug. 16. Among other things, the scheme allegedly involved invalid liens, purported foreclosures, illegal conveyance, bogus title insurance and fraudulent mortgage applications that netted the pair approximately $1.5-million in loan proceeds. Mr. Hawkins and Mr. Skeins have both entered pleas of not guilty and, upon the filing of waivers of a speedy trial and a stipulated motion for a continuance, the case is scheduled for trial next February. While the charges against Mr. Hawkins and Mr. Skeins do not involve Conversion's $310-million UCC note, Stockwatch's investigation of the background to the case, including the review of hundreds of pages of court and county filings, has uncovered matters with significant implications for the company's already highly suspect claims regarding its assets. As previously reported, on Oct. 24, the U.S. Securities and Exchange Commission (SEC) issued a 10-day suspension against Conversion and filed a fraud lawsuit against the company and its now former chief executive officer Rufus Paul Harris alleging that the company's claims about owning billions of dollars worth of bonds are bogus. Even after Conversion was booted from the OTC Bulletin Board to the grey market in the wake of the SEC suspension, many of the promotion's cult-like followers insist that the U.S. regulator is mistaken, or corrupt, and cling to the fantasy that the penniless company has $7.3-billion worth of assets. Other "true longs," casting themselves in the role of "conservative" investors, point to Conversion's dubious audited financial statements covering a period prior to the purported acquisition of the bulk of its bonds as proof that, at the very least, the company had $810-million in assets as of June 30, 2006. Setting aside any detailed consideration of the arguably slipshod audited financial statements, the purported $810-million in assets as of June 30, 2006, reportedly comprised a $500-million Republic of Venezuela bond and the $310-million UCC note. In an affidavit by an SEC accountant filed in connection with the lawsuit, the U.S. regulator offers rather compelling evidence that, among other things, Conversion does not own the $500-million Venezuelan bond. To this point, perhaps understandably satisfied that it can make its fraud case based primarily on the bogus bond claims, the SEC has been silent on the matter of the reported $310-million UCC note, which actually provided the early foundation for the promotion. In any event, Stockwatch's investigation indicates that the purported $310-million UCC note assigned to Conversion precursor Waatle by Mad Dog principal Mr. Hawkins is probably worthless. Mad Dog The intriguing story of Mr. Hawkins and Mad Dog traces back more than two decades to at least the early 1980s. In 1981, Mr. Hawkins was the developer of a nine-story condominium project overlooking Seattle and Puget Sound. At the time, the Mad Dog project was reportedly appraised at $6-million. As construction was nearing completion, Queen City Savings and Loan, which was financing the project, withheld several months worth of draws under the loan contract with Mad Dog. According to Mr. Hawkins, Queen City's actions choked off his company's cash flow and prevented him from making the regular loan payments to the lender. With the loan in default, Queen City then served a notice of foreclosure, shutting the job down. Mad Dog filed for bankruptcy in order to obtain a temporary stay of the foreclosure and sale of the condominium project, hoping to get financing from another source. In May of 1983, however, bankruptcy judge Samuel J. Steiner terminated the stay, clearing the way for Queen City to sell the property. "Then Queen City sold the building to itself, stealing thereby our investment of capital, labor and materials," Mr. Hawkins later declared in an affidavit. "Our business was destroyed, and the businesses of many of my associates were destroyed or suffered injury." Mr. Hawkins quickly filed a fraud lawsuit against Queen City, prevailing in a jury trial in which the verdict and jury award was rendered in February of 1984. According to Mr. Hawkins, however, the jury award "was deliberately, improperly, and unlawfully reported in open court by Judge James McCutcheon" to be $350,000 instead of the $3.5-million actually awarded by the jury. Indeed, based on the affidavits of the 12 jurors subsequently obtained by Mr. Hawkins, the jury evidently believed that it had made awards of $350,000 and $3.2-million for a total of approximately $3.5-million. Alas, according to Mr. Hawkins, Superior Court Judge Donald Thompson accepted the allegedly perjured testimony about the matter by Judge McCutcheon and his bailiff and "refused to correct and record the true jury award." Mr. Hawkins battled on, filing appeals and launching about a dozen civil actions in Washington state and federal courts in addition to lodging complaints with various judicial and administrative bodies. Over the course of about 10 years, the Mad Dog builder lost the appeals and lawsuits and evidently did not receive any satisfaction from bodies such as the Washington State Commission on Judicial Conduct. Evidently distraught, to put it mildly, by the perceived misconduct and chicanery of trial and appellate judges, lawyers, bank executives, county officials and others, Mr. Hawkins turned to another strategy in the early 1990s. By 1994, Mr. Hawkins and Mad Dog began filing non-consensual liens and an "affidavit of obligation" in King county against the property of at least 16 individuals including various judges, lawyers, bank executives and others who he believed had conspired to wrongfully frustrate his civil lawsuits related to the Queen City dispute. In October of 1994, Mr. Hawkins and Mad Dog assigned their purported interests in the liens to Pacific Beach Mortgage Co. Inc., another entity that he controlled. On Nov. 1, 1994, however, Superior Court Judge R. Joseph Wesley issued an order striking liens and other documents filed by Mr. Hawkins, Mad Dog and Pacific Beach. Similar orders were entered by the court with respect to actions involving other properties. The Nov. 1, 1994, court order effectively putting paid to the Mad Dog scheme might have stopped a less determined individual, but Mr. Hawkins barely broke stride. Indeed, while it evidently took a bit of time, Mr. Hawkins added considerably to his list of purported lien debtors following the issuance of the court order intended to bring his "frivolous" and "malicious" activities to an end. On a purported $300-million commercial note filed on July 3, 2001, Mr. Hawkins identifies more than 50 principal and accessory lien debtors including the United States of America, seven judges, at least six lawyers, a handful of Washington state and King county officials and a couple of Seattle police officers, among others. Beginning in about 2000, as part of his efforts to convert the invalid liens into an asset he could use to make money, Mr. Hawkins and his Pacific Beach Mortgage began assigning and transferring interests in purported commercial notes and UCC security notes that ran to billions of dollars in total. Perhaps the UCC notes scheme was not very lucrative. In any event, at least by early 2003, Mr. Hawkins was busy with a scheme that led to his arrest and subsequent indictment along with Mr. Skeins. The mortgage scheme As noted, Mr. Hawkins and Mr. Skeins were arrested on May 3 and indicted on one count of conspiracy to commit wire fraud and two counts of wire fraud on Aug. 16. According to the government's allegations, on April 18, 2003, Pacific Beach filed quit claim deeds on properties that had been the subject of invalid liens by Mad Dog. The deeds purported to pass title from Pacific Beach to another outfit, PowerStone Ltd. The U.S. prosecutor claims that there was no lawful authority for the alleged conveyances. More than two years later, on June 20, 2005, Pacific Beach allegedly filed notices vacating the quit claim deeds to PowerStone, thereby purporting to revert the title back to Mr. Hawkins's Pacific Beach. At some point in the scheme, Mr. Hawkins and Mr. Skeins allegedly started a bogus title insurance company called the Commercial Title and Escrow Company Inc. On March 15 of this year, Mr. Hawkins, acting as president of Pacific Beach, entered into purported sale agreements with a "straw buyer" he recruited for the scheme. The buyer is identified only as "B.D." in the indictment. The straw buyer, armed with allegedly bogus title insurance policies from Commercial Title, then applied for mortgage loans to complete the purchases. All told, Mr. Hawkins and Mr. Skeins allegedly ended up with approximately $1.5-million from the fraudulent mortgage loan scheme. According to the indictment, the allegedly fraudulent scheme was the culmination of Mr. Hawkins's efforts to convert the invalid liens he had been filing since at least 1994 "into an asset he could sell, mortgage, or otherwise use to make money." While the allegedly fraudulent mortgage scheme may well mark the end of Mr. Hawkins's efforts with respect to the invalid liens, particularly given his arrest, his UCC note transfers and assignments arguably deserve some consideration as marking the high point of his efforts, though it is not clear just how much money, if any, he made with that scheme. The UCC notes As noted above, Mr. Hawkins and Pacific Beach transferred and assigned commercial and UCC notes totalling billions of dollars. The largest single UCC note assignment uncovered by Stockwatch amounted to a purported $1-billion that was assigned to Mr. Hawkins and Carl Chuman by Pacific Beach on Dec. 10, 2002. Pacific Beach made a number smaller assignments including $1-million to Joe Cribbs of Birmingham, Ala., another $1-million to William Webb of Lawrenceville, Ga., and $4-million to Dwayne D. Rudd of West Lake, Ohio. All of those assignments were made on Jan. 13, 2003. A larger UCC note assignment was recorded on May 14, 2002, when Pacific Beach assigned a purported $150-million interest to the Great Domestic Insurance Company Inc. of the Philippines and Excalibur International Insurance Services. Interestingly, when Broadband Wireless International Corp. filed a lawsuit as part of its effort to give the boot to Mr. Harris and his two associates, Ben Stanley and John Walsh, the company claimed that they had foisted a purported $100-million, but actually worthless, bond off on them that had been underwritten by two defunct Philippine companies. It is not clear whether the purported $100-million bond that Mr. Harris brought to Broadband is related to the $150-million UCC note assignment Mr. Hawkins's Pacific Beach issued to Great Domestic and Excalibur. In any event, it does appear that Mr. Harris's sidekick at Broadband and Conversion, Mr. Stanley, had some previous dealing with Pacific Beach. Evidently Pacific Beach assigned a $40-million UCC note interest to a company called Progressive Primitive Oaks Inc. some time prior to March of 2000, though that assignment was at least temporarily rescinded for non-performance of whatever contract it entailed on March 16, 2000. By April of 2003, however the Progressive Primitive Oaks deal, whatever its specific nature, was apparently back on. A Pacific Beach corporate resolution of April of 2003 gave Mr. Hawkins authority to open chequing accounts and so on, including the specific authority to direct the opening of a bank account by inviduals identified as Ben Stanley and Mike Grabarkiewiez for depositing "the designated net usable cash" tied to the $40-million UCC assignment to Progressive Primitive Oaks. There is no way of telling just how that turned out, but it certainly appears that at least one subsequent Conversion officer had some relationship with Mr. Hawkins and Pacific Beach predating the UCC note assigned to Waatle that ended up as a Conversion asset. The Waatle note It is difficult to tease much in the way of significant details regarding the UCC note acquired by Conversion through its merger with Waatle on June 17, 2005, from any of the company's SEC filings, and Mr. Harris has been far from forthcoming about the matter. Indeed, when pressed for details about the note by Timothy Miles, one of Conversion's early and sharpest critics, during one of his marathon SupPennyRadio interviews, Mr. Harris simply brushed the questions off by telling Mr. Miles that he should be able to do his own research. Mr. Harris claimed that all the information about the UCC note was available in Waatle news releases, but Stockwatch has had no more success than Mr. Miles in locating any such news releases. According to what apparently passes for audited financial statements, Conversion holds a $310-million UCC note obtained by virtue of the Waatle merger. "The UCC Security Note was properly assigned to Waatle Holdings Corp. (assignee) on April 15, 2004 to be effective on May 27, 2004 from another company (assignor) in exchange for agreed upon consideration," a note to the slipshod financial statements vaguely states. "The UCC Security Note is free and clear of all liens and encumbrances and the company has clear and marketable title to the assets securing the note," the note adds. "The assignor is a corporation organized and existing under the laws of the State of Washington and in good standing under the laws of such State." The note to the financial statements goes on to claim that the value components of the UCC note comprise approximately $172.3-million in principal and $137.8-million in interest, which might lead some skeptics to think that the note is badly impaired, given the whopping interest outstanding and the absence of any payment since the company acquired the note. In any event, the note to the financial statements goes on to disclose that Waatle agreed to pay the unidentified assignor $40-million for the UCC note, with the first payment due within 60 days of May 27, 2004. The first payment was never made and Conversion still owes the full $40-million for the ballyhooed UCC note. While the notes to the financial statements do not identify the mystery assignor, Stockwatch can identify the assignor as Pacific Beach, with the certificate of standing executed by Mr. Hawkins in the role of managing director. Interestingly, the Washington state recorder's cover sheet identifies the assignee as Waatle Holdings LLC with an address in San Diego, Calif. Also of some interest, the May 27, 2004, filing includes a Pacific Beach corporate resolution authorizing the assignment, then pegged at $250-million, that is signed by Dr. Vijaya Kumar as secretary. The resolution lists a Scarborough, Ont., address as Pacific Beach's corporate office, while an exhibit identifying Waatle as the assignee lists a different Scarborough address for Pacific Beach. In any case, a review of the history of Mr. Hawkins and Mad Dog indicates that Conversion's touted $310-million UCC note is every bit as suspect as the company's allegedly bogus bond assets. Indeed, it is probably worthless. Stockwatch will take a closer look at Conversion's purported bonds in a future article. Preliminary injunction In other news, the SEC obtained a preliminary injunction against Mr. Harris and Conversion on Nov. 7. Mr. Harris consented to the entry of the order without admitting or denying the allegations in the lawsuit filed on Oct. 24. In spite of being advised that it had to be represented by counsel, Conversion did not bother to appear with a lawyer at the Nov. 7 hearing. According to the order, Conversion's new chief executive officer Michael Alexander did not oppose the motion for a preliminary injunction. Basically, the preliminary injunction enjoins the defendants, Mr. Harris and Conversion, from making fraudulent claims and violating securities regulations. The injunction also allows the SEC to continue with expedited discovery. Now changing hands on the grey market, Conversion shed another eight cents to close at 47 cents on Nov. 9. Stockwatch will continue to follow developments. Comments regarding this article may be sent to lwebb@stockwatch.com. (More information regarding Conversion Solutions Holdings Corp. is available in Stockwatch articles published on Oct. 13, 16, 18, 20, 24 and 26; and Nov. 2, 3 and 7, 2006.)
__________________ All ambitions are lawful except those which climb upward on the miseries or credulities of mankind. Joseph Conrad, Use your own mind on what to buy and sell!! |
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Tue, 11-14-2006, 09:36 PM
| #72 (permalink) |
| Realist,/Moderator!!! Join Date: Dec 2005 Location: My feet!!!
Posts: 2,738
| Conversion Solutions Holdings Corp Updates Shareholders Conversion Solutions Holdings Corp Updates Shareholders 2006-11-14 22:41 ET - News Release LAKE DALLAS, TX -- (MARKET WIRE) -- 11/14/06 Conversion Solutions Holdings Corp (OTCBB: CSHD), a Delaware Corporation, announces the following current events have taken place. As of 8:38 p.m. on November 14, 2006, Mike Alexander has resigned as director and Chief Executive Officer and Randy Moseley has resigned as Chief Financial Officer of Conversion Solutions Holdings Corp (CSHD). Mike Alexander says that, "I have spent the last couple weeks reviewing the records of Conversion Solutions Holdings Corp (CSHD) and have come to the conclusion that for the Company's assets to be monetized, the Conversion Solutions management group located in Georgia has the background and relationships in the bond market, with the particular bond assets claimed as assets by the Company, to implement the company's business plan. I, and all of the shareholders, wish the group in Georgia the best of luck in the development of the Company and the shareholders' value. Mr. Harris has agreed to assume his previous management and board position and will be making announcements in the near future. He can be reached at (678) 758-3010." About Conversion Solutions Holdings Corp CSHD is a diversified holdings corporation, which was formed to originate, fund and source funding for asset-based transactions in the private market. CSHD's main service will be to acquire, fund and provide insurance to target companies in the currently underserved $15,000,000 to $100,000,000 asset finance market. Our funding will enable our businesses to compete more effectively, improve operations and increase value. CSHD is headquartered in Kennesaw, Georgia, a suburb of Atlanta. For more information, please visit us at www.cvsu.us. Contact Info: Rufus Paul Harris Email Contact (678) 758-3010 Stockwatch > News > News Item
__________________ All ambitions are lawful except those which climb upward on the miseries or credulities of mankind. Joseph Conrad, Use your own mind on what to buy and sell!! |
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Tue, 11-14-2006, 10:59 PM
| #73 (permalink) | |
| Member Join Date: Nov 2006
Posts: 83
| very nice, high five capt. Quote:
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Wed, 11-15-2006, 09:27 AM
| #74 (permalink) |
| Member Join Date: Jul 2006
Posts: 39
| Tomorrow, I am still around haven’t post much because theirs nothing to post nor news. Oh and I am not a pumper I have never told anyone to buy or sell I have only fought with you and capt. Oh and I am not a sheep, I have made money in CSHD and I also have shares which are now in grey sheets and are down 75% but I am still up from my original investment so I am not concern.  I don’t post much on any forum so its not that I put my tail between my legs and left. I am just waiting to see how this turns out and time well tell. Do I like the shareholder’s situation? No. I don’t like that the SEC(bill hicks) saying that it is fraud and not able to prove it to the judge that it is fraud. I don’t like that the SEC(bill hicks) put us on a 10 day suspension with no hard facts and then resume trading on the gray sheets. And he said “it’s to protect the investor” that’s BS.  Well enough said about this back to design buildings I love my job. Good luck everyone….
__________________ SHO TRASH(Ignore)LIST BigCat |
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Fri, 11-17-2006, 12:49 AM
| #75 (permalink) |
| Member Join Date: Apr 2005
Posts: 49
 | Stating the obvious, CSHD is toast: Deadline/Hearing Event Filed 11/16/06 Due/Set 12/04/06 IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA ATLANTA DIVISION SECURITIES AND EXCHANGE COMMISSION, Plaintiff, Civil Action No. v. 1:06-CV-2568-CC CONVERSION SOLUTIONS HOLDING CORPORATION and RUFUS PAUL HARRIS a/k/a PAUL RUFUS HARRIS, Defendants. APPLICATION FOR ENTRY OF DEFAULT The Securities and Exchange Commission (“Commission”), plaintiff in the above-referenced matter, hereby applies to the Clerk of the Court pursuant to Rule 55(a) of the Federal Rules of Civil Procedure for an entry of default against defendant Conversion Solutions Holdings Corp (“Conversion”). Entry of default is sought against Conversion for failure to plead or otherwise defend as provided by Rule 55(a). In support of this application for entry of default against Conversion, the plaintiff has filed Conversion’s return of service. The return of service of process establishes that Conversion, through its registered agent for service of process, Harvard Business Services of Lewes, Delaware, was served with the summons, complaint, request for temporary restraining order, memorandum in support, proposed order, and other associated documents on October 26, 2006. The return of service of process was filed with this Court on November 16, 2006 and is now part of the record in this case. Conversion was obligated to file an answer to the complaint not later than November 15, 2006, but has not filed an answer as required by the federal rules. Since Conversion has not timely filed a response to the complaint, and has not sought an extension, the entry of default is now appropriate. Under Rule 55(a) of the Federal Rules of Civil Procedure, the Clerk of Court is instructed to enter a default against a defendant who “has failed to plead or otherwise defend as provided by the rules,” when a failure to defend is made to appear by affidavit or otherwise. Indeed, the purpose of Rule 55(a) is to relieve the district judge of the obligation of reviewing applications for the entry of default. 6 James W. Moore et al. Moore’s Federal Practice ¶ 55.03[1] n.16 (2d ed. 1992). Thus, the power to enter default is given to the Clerk. Based therefore on the previously filed return of service of summons establishing that Conversion was served through its agent for service of process on October 26, 2006, and the authority specifically granted to the Clerk by Rule 55(a), the Commission respectfully requests the Clerk enter a default against defendant Conversion Solutions forthwith. Respectfully submitted, /s/ William P. Hicks William P. Hicks District Trial Counsel Georgia Bar No. 351649 /s/ Alana R. Black Alana R. Black Senior Trial Counsel Georgia Bar No. 785045 Counsel for Plaintiff SECURITIES AND EXCHANGE COMMISSION 3475 Lenox Road, N.E., Suite 1000 Atlanta, Georgia 30326-1232 Telephone: (404) 842-7600 CERTIFICATE OF SERVICE I hereby certify that on this 16th day of November, 2006, I mailed by United States Postal Service the preceding Notice of Filing of Returns of Service to the following non-CM/ECF participants: Rufus Paul Harris a/k/a Paul Rufus Harris 383 Clear Creek Road, N.W. Adairsville, Georgia 30103-5934 Conversion Solutions Holdings Corporation c/o Registered Agent Harvard Business Services 16192 Coastal Highway Lewes, DE 19958 /s/ Alana R. Black Alana R. Black Counsel for Plaintiff Georgia Bar No. 785045 U.S. Securities and Exchange Commission Atlanta District Office 3475 Lenox Road, N. E., Suite 1000 Atlanta, Georgia 30326-1232 Tel. No. (404) 842-7678 blacka@sec.gov |
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Fri, 11-17-2006, 12:51 AM
| #76 (permalink) |
| Member Join Date: Apr 2005
Posts: 49
| Conversion Solutions CEO hands off to ex-CEO 2006-11-16 19:30 ET - Street Wire by Lee M. Webb Conversion Solutions Holdings Corp.'s cult-like Internet followers are in a near-rapturous tizzy over the news that chief executive officer Michael Alexander has handed management of the company back to the man he fired less than two weeks ago, semi-literate promoter Rufus Paul Harris. The latest switcheroo, announced in a surprise news release issued at 10:41 p.m. on Nov. 14, came about seven hours after Conversion notified the U.S. Securities and Exchange Commission (SEC) that the company will be late in filing its quarterly report for the period ending Sept. 30, 2006. Given that the SEC is suing Conversion and Mr. Harris over allegedly fraudulent claims regarding purported billions of dollars worth of bond assets, it probably comes as little surprise to most knowledgeable investors that the company could not make the Nov. 14 deadline for filing its first-quarter report. As previously reported by Stockwatch, the U.S. regulator issued a temporary trading suspension against Conversion and filed a lawsuit against the company and Mr. Harris on Oct. 24. Mr. Alexander, the former head of Conversion's OTC Bulletin Board predecessor, the FrontHaul Group Inc., and the company's largest shareholder, gave Mr. Harris and the rest of the troubled promotion's management and directors the boot on Nov. 2. Among other things, Mr. Alexander claimed that the ousted officers and directors triggered the SEC suspension and investigation by "filing erroneous financial statements." "They have published misleading and questionable press releases and other communications to shareholders and the general public and they have failed to file proper documents and amendments with the Delaware Secretary of State relative to the Company's Articles of Incorporation," Mr. Alexander went on to report in a Nov. 3 SEC filing. In the wake of the SEC's 10-day trading suspension, Conversion, which claimed to have approximately $7.3-billion in assets consisting primarily of bonds as of Oct. 16, was booted from the OTC-BB to the lowly grey market on Nov. 7. Mr. Alexander's brief tenure as chief executive officer after booting Mr. Harris began with the resolve to file an amended annual report and a first-quarter report "as soon as possible," but the Nov. 14 notification of late filing for the quarterly report for the period ending Sept. 30 indicates that his resolve could not be realized by the due date. Late is good In the peculiar world of Conversion's Internet worshipers, many of whom congregate on **************.com to swap fantasies and misinformation with like-minded cheerleaders, the Nov. 14 notification of late filing is a good thing. Among other things, some gullible shareholders suggest that the late filing notice indicates that Conversion has proven that it owns the billions of dollars of disputed bonds and that the company is definitely on the up and up. According to some of Conversion's leading, and largely unchallenged acolytes, the notice of late filing is a good thing because grey market companies are not even required to file financial statements with the SEC. In fact, being ignominiously booted down to the grey market under the pall of an SEC suspension and fraud suit does not absolve a reporting issuer from its obligations to file periodic reports, including quarterly financial reports, as required by federal securities regulations. Conversion cheerleaders glossed over, or simply dismissed as inapplicable, the fact that the notice of late filing submitted by Mr. Alexander indicated that the company did not expect that the delayed quarterly report would reflect any significant change in the results of operations from the corresponding period last year; specifically, from the period ending Sept. 30, 2005. Interestingly, in the first quarter of last year the company was engaged in a money losing trucking related operation with less than $80,000 in revenue and rang up a $3.4-million net loss through the first three months of the fiscal year. In any event, with fantasy obviously trumping fact among the company's zealous followers, the late filing notice sent many of Conversion's naive shareholders into an early tizzy. Indeed, in the wake of Conversion's late filing notice, many "true longs" proclaimed that they would be acting upon one of Mr. Harris's earlier exhortations to "buy the crap out of it" the following day. With the later news that Mr. Alexander was handing the company back to Mr. Harris, many more ************** cheerleaders vowed to join the buy-the-crap-out-of-it crowd. Change is good In the strange world of Conversion's cult-like Internet followers, evidently change is good, too. Indeed, no matter how damning some developments might seem to other observers, it is difficult to find anything at all related to Conversion that is not imaginatively spun into a positive thing by the company's loyal fans. For example, while there was some early shock on Nov. 2 when the company reported that the board of directors had voted to remove Mr. Harris, imaginative Conversion cheerleaders quickly served up a positive spin. Among other things, some of the devoted leaders proclaimed that the ouster paved the way for Conversion to appoint some well known chief executive officer with a proven track record in the financial industry to take the company to the next level. When it was disclosed just 12 hours later that Mr. Alexander, the former head of money-losing FrontHaul, was taking over after giving the heave-ho to the entire management and board of directors of Conversion, well, that was good, too. After all, the unflagging, if remarkably fickle, Conversion cheerleaders proclaimed, Mr. Alexander had the largest stake in the company and, notwithstanding his foul language, was clearly the best man for the job. Already oddly buoyed by the notice of late filing, Conversion's devoted followers, including Mr. Alexander's formerly dedicated supporters, were ecstatic over the 10:41 p.m. news release announcing that he was giving way as chief executive officer in favour of Mr. Harris. That announcement, coming just 12 days after Mr. Alexander gave the boot to Mr. Harris and his associates, was evidently about as good as it can possibly get as far as Conversion's loyal ************** followers were concerned. Even some of the company's critics seem to agree with that assessment, at least in terms of remarkably wild market entertainment. "An amazing story!" one skeptical Internet stock promotion sleuth remarked to Stockwatch. "You just can't make this stuff up." The handoff According to the late evening Nov. 14 news release, Mr. Alexander resigned as chief executive officer and director of Conversion at 8:38 p.m., several hours after notifying the SEC that the company's first-quarter report would be delayed. Randy Moseley bailed as the company's chief financial officer at the same time. "I have spent the last couple weeks reviewing the records of Conversion Solutions Holdings Corp (CSHD) and have come to the conclusion that for the Company's assets to be monetized, the Conversion Solutions management group located in Georgia has the background and relationships in the bond market, with the particular bond assets claimed as assets by the Company, to implement the company's business plan," Mr. Alexander stated in his farewell address. According to the interpretation favoured by Conversion's starry-eyed Internet followers, Mr. Alexander's statement clearly indicated that he had verified the penniless company's purported ownership of billions of dollars worth of bonds and was simply yielding to the man with the experience to put those bonds to use. "I, and all of the shareholders, wish the group in Georgia the best of luck in the development of the Company and the shareholders' value," Mr. Alexander continued. "Mr. Harris has agreed to assume his previous management and board position and will be making announcements in the near future," the abdicating chief executive officer reported. Interestingly, Mr. Harris was in the midst of a public engagement when the surprise news of his reappointment broke. Live on SubPennyRadio As previously reported by Stockwatch, while formerly in the role of Conversion's chief executive officer, Mr. Harris participated in several marathon interviews running into the wee hours of the morning on obscure Internet-based SubPennyRadio.com. Even after being ditched by Mr. Alexander, the seemingly indomitable tout continued to call in to the radio program. As it happens, sounding uncharacteristically subdued, Mr. Harris was nattering away on SubPennyRadio on the evening of Nov. 14. In response to an early question, Mr. Harris assured listeners that the merger with FrontHaul could not be undone. He went on to insist that Conversion is not a fraud. Sounding somewhat perturbed, Mr. Harris later suggested that he really did not have a clue about where the company was headed any longer. Mr. Harris was still nattering away when the radio host received the news that Mr. Alexander had packed it in and passed the job back to Mr. Harris. "It's official," Mr. Harris remarked, perking up. "I'm glad to be back." By Mr. Harris's assessment, the fact that he was asked to come back as chief executive officer was because of proof that Conversion actually does own the billions of dollars worth of bonds as he claimed in news releases and SEC filings. According to Mr. Harris, who is under a preliminary injunction obtained by the SEC prohibiting him from, among other things, making any untrue statement of material fact, all the ducks are lined up and there are multiple deals on the table. "Just sit back, relax, and we'll finish this thing off," Mr. Harris told his SubPennyRadio listeners. While the SubPennyRadio host has accommodated Mr. Harris and his loyal fans until 4 a.m. or so in the past, he cut his Nov. 14 program short not long after he introduced the topic of Conversion's late evening news release. Notwithstanding the early SubPennyRadio exit, the excited celebration over Mr. Harris's surprise return continued for hours on **************. Touting Tut A Canadian tout posting under the alias "tutankhamen" did his best to rally Conversion's loyal followers further on Nov. 15. Tut, as the ************** Conversion followers affectionately call him, is held in high esteem by many of the company's loyal fans. Interestingly, the Canadian tout threw his full support behind Mr. Alexander when he gave Mr. Harris the boot, but his allegiance has shifted once again. "Shareholders you need to understand that Rufus coming back is a strong signal that everything is real and this was the best thing that could happen for the company," touting Tut proclaimed. "He is the one that deals with the European banking platform and is the one that is trusted by them. "It was needed, and him coming back tells you now everything can move forward. The SEC situation will be (sic) just have to go through the formal clearing method but what the company has stated they have is now shown to be. "I think we can now look forward to events happening like they should have and you should all be happy with the results. "Take a strong clue from this. It is very good news and we are winning the battle and now it is onward and upward and no one can tell you differently." Different tale While touting Tut seems to believe that things are pretty much hunky-dory, the SEC still claims otherwise in its lawsuit against Conversion and Mr. Harris filed in the U.S. District Court for the Northern District of Georgia on Oct. 24. According to the SEC's allegations and supporting affidavit, the company's claims about owning billions of dollars worth of bonds are complete bunkum. Notwithstanding the admonition of Judge Clarence Cooper, Conversion had not retained counsel to represent it as of Nov. 7 when the SEC obtained its preliminary injunction against the defendants and no lawyer has yet filed an appearance on behalf of either the company or Mr. Harris, who has just been handed responsibility for the whole mess again. Indeed, the purported multibillion-dollar Conversion did not even manage to file an answer to the SEC complaint within the alloted time following service of the lawsuit. On Nov. 16, the SEC filed an application for entry of default against the company. "Conversion was obligated to file an answer to the complaint not later than November 15, 2006, but has not filed an answer as required by the federal rules," the SEC notes in its Nov. 16 application. "Since Conversion has not timely filed a response to the complaint, and has not sought an extension, the entry of default is now appropriate," the U.S. regulator claims. Mr. Harris was not served until Nov. 4 when the process server handed the documents to the defendant's daughter, Kayla Harris, so he has until Nov. 25 to file an answer to the complaint. Setting aside the troubling fraud allegations in the SEC lawsuit, the market apparently also disagrees with touting Tut's assessment, not to mention Mr. Harris's lofty claim that the company has a book value of $70.71 per share. Notwithstanding the efforts of shareholders claiming to follow Mr. Harris's exhortation to buy the crap out of it, the market evidently had something different to tell investors about Conversion in the first trading session following the semi-literate promoter's reappointment as chief executive officer. With approximately 2.2 million shares changing hands in grey market matched trades, Conversion closed flat at 35 cents on Nov. 15. Some muted murmurs of discontent even began to surface among Conversion's devoted ************** followers as the stock lost ground on Thursday. With a more modest 666,600 shares changing hands, Conversion shed a nickel to close at 30 cents on Nov. 16. Stockwatch will continue to follow developments. Comments regarding this article may be sent to lwebb@stockwatch.com. (More information regarding Conversion Solutions Holdings Corp. is available in Stockwatch articles published on Oct. 13, 16, 18, 20, 24 and 26; and Nov. 2, 3, 7 and 10, 2006.) Reader Comments - Comments are open and unmoderated, although libelous remarks may be deleted. Opinions expressed do not necessarily reflect the views of Stockwatch. "True Longs" baaawhaaa! Seem the CMKX sheep have moved to another pasture. Posted by goLEEgo @ 2006-11-16 20:56 |
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Fri, 11-17-2006, 01:01 AM
| #78 (permalink) |
| Member Join Date: Apr 2005
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| Conversion Solutions CEO hands off to ex-CEO 2006-11-16 19:30 ET - Street Wire by Lee M. Webb Conversion Solutions Holdings Corp.'s cult-like Internet followers are in a near-rapturous tizzy over the news that chief executive officer Michael Alexander has handed management of the company back to the man he fired less than two weeks ago, semi-literate promoter Rufus Paul Harris. The latest switcheroo, announced in a surprise news release issued at 10:41 p.m. on Nov. 14, came about seven hours after Conversion notified the U.S. Securities and Exchange Commission (SEC) that the company will be late in filing its quarterly report for the period ending Sept. 30, 2006. Given that the SEC is suing Conversion and Mr. Harris over allegedly fraudulent claims regarding purported billions of dollars worth of bond assets, it probably comes as little surprise to most knowledgeable investors that the company could not make the Nov. 14 deadline for filing its first-quarter report. As previously reported by Stockwatch, the U.S. regulator issued a temporary trading suspension against Conversion and filed a lawsuit against the company and Mr. Harris on Oct. 24. Mr. Alexander, the former head of Conversion's OTC Bulletin Board predecessor, the FrontHaul Group Inc., and the company's largest shareholder, gave Mr. Harris and the rest of the troubled promotion's management and directors the boot on Nov. 2. Among other things, Mr. Alexander claimed that the ousted officers and directors triggered the SEC suspension and investigation by "filing erroneous financial statements." "They have published misleading and questionable press releases and other communications to shareholders and the general public and they have failed to file proper documents and amendments with the Delaware Secretary of State relative to the Company's Articles of Incorporation," Mr. Alexander went on to report in a Nov. 3 SEC filing. In the wake of the SEC's 10-day trading suspension, Conversion, which claimed to have approximately $7.3-billion in assets consisting primarily of bonds as of Oct. 16, was booted from the OTC-BB to the lowly grey market on Nov. 7. Mr. Alexander's brief tenure as chief executive officer after booting Mr. Harris began with the resolve to file an amended annual report and a first-quarter report "as soon as possible," but the Nov. 14 notification of late filing for the quarterly report for the period ending Sept. 30 indicates that his resolve could not be realized by the due date. Late is good In the peculiar world of Conversion's Internet worshipers, many of whom congregate on **************.com to swap fantasies and misinformation with like-minded cheerleaders, the Nov. 14 notification of late filing is a good thing. Among other things, some gullible shareholders suggest that the late filing notice indicates that Conversion has proven that it owns the billions of dollars of disputed bonds and that the company is definitely on the up and up. According to some of Conversion's leading, and largely unchallenged acolytes, the notice of late filing is a good thing because grey market companies are not even required to file financial statements with the SEC. In fact, being ignominiously booted down to the grey market under the pall of an SEC suspension and fraud suit does not absolve a reporting issuer from its obligations to file periodic reports, including quarterly financial reports, as required by federal securities regulations. Conversion cheerleaders glossed over, or simply dismissed as inapplicable, the fact that the notice of late filing submitted by Mr. Alexander indicated that the company did not expect that the delayed quarterly report would reflect any significant change in the results of operations from the corresponding period last year; specifically, from the period ending Sept. 30, 2005. Interestingly, in the first quarter of last year the company was engaged in a money losing trucking related operation with less than $80,000 in revenue and rang up a $3.4-million net loss through the first three months of the fiscal year. In any event, with fantasy obviously trumping fact among the company's zealous followers, the late filing notice sent many of Conversion's naive shareholders into an early tizzy. Indeed, in the wake of Conversion's late filing notice, many "true longs" proclaimed that they would be acting upon one of Mr. Harris's earlier exhortations to "buy the crap out of it" the following day. With the later news that Mr. Alexander was handing the company back to Mr. Harris, many more ************** cheerleaders vowed to join the buy-the-crap-out-of-it crowd. Change is good In the strange world of Conversion's cult-like Internet followers, evidently change is good, too. Indeed, no matter how damning some developments might seem to other observers, it is difficult to find anything at all related to Conversion that is not imaginatively spun into a positive thing by the company's loyal fans. For example, while there was some early shock on Nov. 2 when the company reported that the board of directors had voted to remove Mr. Harris, imaginative Conversion cheerleaders quickly served up a positive spin. Among other things, some of the devoted leaders proclaimed that the ouster paved the way for Conversion to appoint some well known chief executive officer with a proven track record in the financial industry to take the company to the next level. When it was disclosed just 12 hours later that Mr. Alexander, the former head of money-losing FrontHaul, was taking over after giving the heave-ho to the entire management and board of directors of Conversion, well, that was good, too. After all, the unflagging, if remarkably fickle, Conversion cheerleaders proclaimed, Mr. Alexander had the largest stake in the company and, notwithstanding his foul language, was clearly the best man for the job. Already oddly buoyed by the notice of late filing, Conversion's devoted followers, including Mr. Alexander's formerly dedicated supporters, were ecstatic over the 10:41 p.m. news release announcing that he was giving way as chief executive officer in favour of Mr. Harris. That announcement, coming just 12 days after Mr. Alexander gave the boot to Mr. Harris and his associates, was evidently about as good as it can possibly get as far as Conversion's loyal ************** followers were concerned. Even some of the company's critics seem to agree with that assessment, at least in terms of remarkably wild market entertainment. "An amazing story!" one skeptical Internet stock promotion sleuth remarked to Stockwatch. "You just can't make this stuff up." The handoff According to the late evening Nov. 14 news release, Mr. Alexander resigned as chief executive officer and director of Conversion at 8:38 p.m., several hours after notifying the SEC that the company's first-quarter report would be delayed. Randy Moseley bailed as the company's chief financial officer at the same time. "I have spent the last couple weeks reviewing the records of Conversion Solutions Holdings Corp (CSHD) and have come to the conclusion that for the Company's assets to be monetized, the Conversion Solutions management group located in Georgia has the background and relationships in the bond market, with the particular bond assets claimed as assets by the Company, to implement the company's business plan," Mr. Alexander stated in his farewell address. According to the interpretation favoured by Conversion's starry-eyed Internet followers, Mr. Alexander's statement clearly indicated that he had verified the penniless company's purported ownership of billions of dollars worth of bonds and was simply yielding to the man with the experience to put those bonds to use. "I, and all of the shareholders, wish the group in Georgia the best of luck in the development of the Company and the shareholders' value," Mr. Alexander continued. "Mr. Harris has agreed to assume his previous management and board position and will be making announcements in the near future," the abdicating chief executive officer reported. Interestingly, Mr. Harris was in the midst of a public engagement when the surprise news of his reappointment broke. Live on SubPennyRadio As previously reported by Stockwatch, while formerly in the role of Conversion's chief executive officer, Mr. Harris participated in several marathon interviews running into the wee hours of the morning on obscure Internet-based SubPennyRadio.com. Even after being ditched by Mr. Alexander, the seemingly indomitable tout continued to call in to the radio program. As it happens, sounding uncharacteristically subdued, Mr. Harris was nattering away on SubPennyRadio on the evening of Nov. 14. In response to an early question, Mr. Harris assured listeners that the merger with FrontHaul could not be undone. He went on to insist that Conversion is not a fraud. Sounding somewhat perturbed, Mr. Harris later suggested that he really did not have a clue about where the company was headed any longer. Mr. Harris was still nattering away when the radio host received the news that Mr. Alexander had packed it in and passed the job back to Mr. Harris. "It's official," Mr. Harris remarked, perking up. "I'm glad to be back." By Mr. Harris's assessment, the fact that he was asked to come back as chief executive officer was because of proof that Conversion actually does own the billions of dollars worth of bonds as he claimed in news releases and SEC filings. According to Mr. Harris, who is under a preliminary injunction obtained by the SEC prohibiting him from, among other things, making any untrue statement of material fact, all the ducks are lined up and there are multiple deals on the table. "Just sit back, relax, and we'll finish this thing off," Mr. Harris told his SubPennyRadio listeners. While the SubPennyRadio host has accommodated Mr. Harris and his loyal fans until 4 a.m. or so in the past, he cut his Nov. 14 program short not long after he introduced the topic of Conversion's late evening news release. Notwithstanding the early SubPennyRadio exit, the excited celebration over Mr. Harris's surprise return continued for hours on **************. Touting Tut A Canadian tout posting under the alias "tutankhamen" did his best to rally Conversion's loyal followers further on Nov. 15. Tut, as the ************** Conversion followers affectionately call him, is held in high esteem by many of the company's loyal fans. Interestingly, the Canadian tout threw his full support behind Mr. Alexander when he gave Mr. Harris the boot, but his allegiance has shifted once again. "Shareholders you need to understand that Rufus coming back is a strong signal that everything is real and this was the best thing that could happen for the company," touting Tut proclaimed. "He is the one that deals with the European banking platform and is the one that is trusted by them. "It was needed, and him coming back tells you now everything can move forward. The SEC situation will be (sic) just have to go through the formal clearing method but what the company has stated they have is now shown to be. "I think we can now look forward to events happening like they should have and you should all be happy with the results. "Take a strong clue from this. It is very good news and we are winning the battle and now it is onward and upward and no one can tell you differently." Different tale While touting Tut seems to believe that things are pretty much hunky-dory, the SEC still claims otherwise in its lawsuit against Conversion and Mr. Harris filed in the U.S. District Court for the Northern District of Georgia on Oct. 24. According to the SEC's allegations and supporting affidavit, the company's claims about owning billions of dollars worth of bonds are complete bunkum. Notwithstanding the admonition of Judge Clarence Cooper, Conversion had not retained counsel to represent it as of Nov. 7 when the SEC obtained its preliminary injunction against the defendants and no lawyer has yet filed an appearance on behalf of either the company or Mr. Harris, who has just been handed responsibility for the whole mess again. Indeed, the purported multibillion-dollar Conversion did not even manage to file an answer to the SEC complaint within the alloted time following service of the lawsuit. On Nov. 16, the SEC filed an application for entry of default against the company. "Conversion was obligated to file an answer to the complaint not later than November 15, 2006, but has not filed an answer as required by the federal rules," the SEC notes in its Nov. 16 application. "Since Conversion has not timely filed a response to the complaint, and has not sought an extension, the entry of default is now appropriate," the U.S. regulator claims. Mr. Harris was not served until Nov. 4 when the process server handed the documents to the defendant's daughter, Kayla Harris, so he has until Nov. 25 to file an answer to the complaint. Setting aside the troubling fraud allegations in the SEC lawsuit, the market apparently also disagrees with touting Tut's assessment, not to mention Mr. Harris's lofty claim that the company has a book value of $70.71 per share. Notwithstanding the efforts of shareholders claiming to follow Mr. Harris's exhortation to buy the crap out of it, the market evidently had something different to tell investors about Conversion in the first trading session following the semi-literate promoter's reappointment as chief executive officer. With approximately 2.2 million shares changing hands in grey market matched trades, Conversion closed flat at 35 cents on Nov. 15. Some muted murmurs of discontent even began to surface among Conversion's devoted ************** followers as the stock lost ground on Thursday. With a more modest 666,600 shares changing hands, Conversion shed a nickel to close at 30 cents on Nov. 16. Stockwatch will continue to follow developments. Comments regarding this article may be sent to lwebb@stockwatch.com. (More information regarding Conversion Solutions Holdings Corp. is available in Stockwatch articles published on Oct. 13, 16, 18, 20, 24 and 26; and Nov. 2, 3, 7 and 10, 2006.) Reader Comments - Comments are open and unmoderated, although libelous remarks may be deleted. Opinions expressed do not necessarily reflect the views of Stockwatch. "True Longs" baaawhaaa! Seem the CMKX sheep have moved to another pasture. Posted by goLEEgo @ 2006-11-16 20:56 |
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Sat, 11-18-2006, 05:50 PM
| #79 (permalink) |
| Realist,/Moderator!!! Join Date: Dec 2005 Location: My feet!!!
Posts: 2,738
| Conversion Solutions Announces Emergency Shareholders Meeting Conversion Solutions Announces Emergency Shareholders Meeting KENNESAW, Ga., Nov. 17 /PRNewswire-FirstCall/ -- Conversion Solutions Holdings Corp (OTC: CSHD), a Delaware Corporation, announces that an emergency shareholders meeting has been called and will be held in Washington, D.C. on December 17, 2006 (30 days from today). The Meeting will be available via tele-conference and video-conference. Each shareholder of record will receive notification via mail. The exact location of the meeting is to be announced upon receipt of the required permits. CSHD would also like to call an emergency meeting of the shareholders committee via teleconference November 18, 2006 at 5:00 PM. Each shareholder is hereby requested to go to the following website starting on Monday, November 20, 2006: www.cshdshareholdercommittee.com. A database will be set-up so each shareholder can update your mailing information for the corporate mailer. The corporation will cross reference the information provided against a current NOBO list. CSHD would like announce the result of the last internal market investigation of reported shareholders vs. NOBO list; the number of documented shareholders above the reported NOBO exceed 800 and still counting. Rufus Paul Harris, Chairman and CEO stated, 'Very confusing events have taken place and I feel that it is necessary and very important to hold the annual meeting and discuss with every shareholder the forward movement of the corporation. I will be releasing important information about the corporation's current status and recent events over the weekend. 'I know the storm is strong and we may suffer some damage but we will still be standing strong at the end. I have worked long and hard to form and build this corporation, and I will not stand by and let illegal market activities prevent us from our goals. Our corporation is the model corporation and will be the beginning of a new market place. Be careful out there in the market; try not to feed the beast unless forced too. I would also like to thank each and every one of you for your prayers in these trying times, and may GOD bless each of you.' SOURCE Conversion Solutions Holdings Corp Source: PR Newswire (November 17, 2006 - 4:45 PM EST) ------------------------------------------------------------------------------------ MA resignation PR: November 14, 2006 - 10:41 PM EST Conversion Solutions Holdings Corp Updates Shareholders Conversion Solutions Holdings Corp (OTCBB: CSHD), a Delaware Corporation, announces the following current events have taken place. As of 8:38 p.m. on November 14, 2006, Mike Alexander has resigned as director and Chief Executive Officer and Randy Moseley has resigned as Chief Financial Officer of Conversion Solutions Holdings Corp (CSHD). Mike Alexander says that, "I have spent the last couple weeks reviewing the records of Conversion Solutions Holdings Corp (CSHD) and have come to the conclusion that for the Company's assets to be monetized, the Conversion Solutions management group located in Georgia has the background and relationships in the bond market, with the particular bond assets claimed as assets by the Company, to implement the company's business plan. I, and all of the shareholders, wish the group in Georgia the best of luck in the development of the Company and the shareholders' value. Mr. Harris has agreed to assume his previous management and board position and will be making announcements in the near future. He can be reached at (678) 758-3010." About Conversion Solutions Holdings Corp CSHD is a diversified holdings corporation, which was formed to originate, fund and source funding for asset-based transactions in the private market. CSHD's main service will be to acquire, fund and provide insurance to target companies in the currently underserved $15,000,000 to $100,000,000 asset finance market. Our funding will enable our businesses to compete more effectively, improve operations and increase value. CSHD is headquartered in Kennesaw, Georgia, a suburb of Atlanta. For more information, please visit us at www.cvsu.us. Source: Market Wire (November 14, 2006 - 10:41 PM EST) ------------------------------------------------------------------------------------ INTERVIEWS Rufus on Radio 11/14/2006 (Rufus comes on at 12:48 into the audio file) http://www.yourfilehost.com/media.ph...us_Is_Back.wma RUFUS on Radio MP3 - 11/8-9/2006 http://www.ultimateuploads.com/audio...588a38e8234fa6 RUFUS on Radio MP3 - 11/07/2006 http://www.ultimateuploads.com/audio...ce5e531f2334de RUFUS on Radio MP3 - 11/06/2006 http://www.ultimateuploads.com/audio...1c87fb512041d6 Bluediamonds summary of most recent interview: http://www.**************.com/forums...824#post936824 http://www.**************.com/forums...827#post936827
__________________ All ambitions are lawful except those which climb upward on the miseries or credulities of mankind. Joseph Conrad, Use your own mind on what to buy and sell!! |
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Thu, 12-07-2006, 07:57 PM
| #80 (permalink) |
| Realist,/Moderator!!! Join Date: Dec 2005 Location: My feet!!!
Posts: 2,738
| Conversion Solutions dumps Harris for Vancouver tout,LOLOL Conversion Solutions dumps Harris for Vancouver tout 2006-12-07 11:49 ET - Street Wire by Lee M. Webb Conversion Solutions Holdings Corp., a virtually penniless promotion being sued by the U.S. Securities and Exchange Commission (SEC), has dumped semi-literate chief executive officer Rufus Paul Harris for the second time in less than a month. Howe Street promoter and Internet tout John L. Arlitt now heads the skunky grey market outfit. As previously reported, the SEC suspended Conversion, then trading on the OTC Bulletin Board, and filed a lawsuit against the company and Mr. Harris in the U.S. District Court for the Northern District of Georgia on Oct. 24. Among other things, the U.S. regulator alleges that Conversion and Mr. Harris made false and misleading claims about the company's purported $7.3-billion (U.S.) in assets, supposedly consisting primarily of bonds, fraudulently inflating the price of the stock in the process. Conversion, which had traded as high as $4 (U.S.) as the bond promotion ramped up, was ignominiously kicked down to the lowly grey market in the wake of the SEC suspension and is now changing hands for approximately 20 U.S. cents in matched trading. Neither Conversion nor Mr. Harris bothered to file a reply to the SEC lawsuit and entries of default have recently been filed against both defendants, paving the way for the U.S. regulator to seek default judgments. With the share price taking a nosedive and some rather belated bleating issuing from Conversion's flock of gullible Internet cheerleaders, the former head of the company's OTC-BB predecessor the FrontHaul Group Inc., Michael Alexander ousted Mr. Harris and took over as chief executive officer on Nov. 2. On Nov. 14, just 12 days after giving the Georgia promoter the bum's rush, Mr. Alexander washed his hands of the mess and passed the reins back to Mr. Harris. Semi-literate Mr. Harris was only back in the saddle for 13 days before he was rudely unhorsed again. On Nov. 27, with the backing of Mr. Alexander and his associates and the support of a so-called shareholders committee, Mr. Harris was dumped in favour of Mr. Arlitt. The biography According to the biographical information now adorning Conversion's otherwise rather barren website, Mr. Arlitt's experience includes a stint as a Vancouver broker spanning three years from 1987 to 1990. As noted in a previous Stockwatch article, however, registration information from the British Columbia Securities Commission (BCSC) indicates that Mr. Arlitt spent about six months with Jones, Gable & Company Ltd. before moving on to Georgia Pacific Securities Corp. for 11 months. All told, according to the BCSC, Mr. Arlitt worked as a broker for a little more than 17 months before his registration was terminated on Aug. 31, 1988. Mr. Arlitt's biographical sketch claims that he has over 20 years of extensive experience in the financial industry as the sole owner and head of Arlitt Financial Corp., though that is hard to square with his claim to having been a broker from 1987 to 1990 as well as other public disclosures indicating that his Vancouver-based company has only been around since 1990. Conversion's new champion further reports that he has assisted "in financial consulting and financing of numerous public companies" through Arlitt Financial and his experience includes serving as "president and director of numerous public companies." Stockwatch's research indicates that Mr. Arlitt served as president and chief executive officer of only one public company for approximately 13 months, during which time nary a trade was registered because of cease trade order, before abruptly leaving without so much as a fond fare-thee-well from his former charge. Stockwatch's records further indicate that Mr. Arlitt served brief stints, some lasting only a few weeks, as a director of five other Canadian public companies. Mr. Arlitt has not served as an officer or director of any multibillion-dollar company or, for that matter, any company with a purported massive portfolio of bonds. Of course, any such experience would be largely irrelevant to Conversion. As noted in a previous article, the biographical sketch posted on Conversion's website and duplicated in a Nov. 29 SEC filing hardly does justice to Mr. Arlitt's experience as a Howe Street promoter and completely glosses over his Internet touting activities. In this article, Stockwatch will begin its review of Mr. Arlitt's association with approximately 20 companies that graced the former scandal-plagued Vancouver Stock Exchange (VSE) and its far from pristine cousin, the Alberta Stock Exchange (ASE), which subsequently combined to morph into the Canadian Venture Exchange (CDNX) and then the TSX Venture Exchange (TSX-V). Acorn Resources In March of 1989, cashless Acorn Resources Ltd., then eking out an occasional trade at less than 10 cents, announced that Mr. Arlitt would be joining the company's board of directors. By February of 1990, Acorn had been cited several times as a delinquent filer and was then pronounced inactive. In July of 1990, Acorn executed a 1-for-5 share consolidation and changed its name to Consolidated Acorn Resources Ltd. It is not clear just how much time, if any, Mr. Arlitt actually served as an Acorn director, but he was not a member of the company's board headed by the legendary promoter Murray Pezim by September of 1990. Alas, not even the consummate promoter Mr. Pezim could breathe much life into Acorn. By December of 1992, with the stock languishing a four cents, Acorn was cease traded. Three months later, Acorn suffered the ultimate humiliation and was delisted from the VSE. Chapleau Resources In June of 1990, Chapleau Resources Ltd., limping along with sporadic light trades for less than 20 cents per share, hired Mr. Arlitt of Arlitt Financial "to perform investor relations and promotions services" for the company until Dec. 31, 1990. By the time Mr. Arlitt's announced six-month stint ended, Chapleau's shares were changing hands for eight cents in lacklustre trading. There is no indication that Mr. Arlitt has had anything to do with Chapleau for more than 15 years. Chapleau is still operating, now as a TSX-V company, and has recently been trading at approximately 65 cents per share. Coast Diamond In July of 1993, Coast Diamond Ventures Ltd. entered into an investor relations agreement with Arlitt Financial "to provide promotion and investor/shareholder communication services." As disclosed by Coast Diamond, the compensation for Mr. Arlitt's services for three months was pegged at $7,500 or 25,000 shares at a deemed price of 30 cents per share. At the time, the company's shares were trading at less than 30 cents and were soon headed lower. It is not clear whether Mr. Arlitt was involved with Coast Diamond after his first three-month stint, which would have come to an end in October of 1993. In December of 1993, Coast Diamond decided to get out of the mining exploration business and into global positioning technology through a reverse takeover. On Dec. 7, 1993, with the company's shares trading for about 15 cents, Coast Diamond was halted pending acceptance of the reverse takeover, which occurred many months later. In June of 1994, as part of the transaction, the company executed a 1-for-3 reverse split and changed its name to Avcan Global Systems Inc. In April of 1999, the company executed a 1-for-4 consolidation and changed its name again, this time to ASC Avcan Systems Corp. In September of 2001, ASC Avcan executed a more severe 1-for-10 reverse split and changed its name to Avcan Systems Inc. In October of 2003, the company changed its name to Optimal Geomatics Inc. without any further consolidation of capital, no doubt to the relief of its shareholders. Recently, the company's shares have been trading at 14 cents. Oil City In March of 1994, Arlitt Financial signed on to assist Oil City Lubricants Ltd., trading for less than a dime, "in its investor relations and fund raising." Mr. Arlitt's assignment came on the heels of Oil City losing a deal to acquire the Canadian rights to flog some kind of aloe vera beverage because of a lack of cash, but the company held out some hope that might be remedied by its new consultant. It is not clear just how long Mr. Arlitt persevered in his investor relations and financing efforts for Oil City, but the aloe vera drink deal never materialized. Apart from several delinquent filer notices, the granting of options and the release of shares from escrow, there was no news out of Oil City until April 30, 1996, when the company did a 1-for-5 rollback and changed its name to Thunder Sword Resources Inc. While it went on to hit a few rough patches over the years, Thunder Sword survived without the ministrations of Mr. Arlitt and has recently been trading for approximately $2.60 per share. Cradle Mountain/Upper Canada In April of 1994, Cradle Mountain Canada Ltd., a junior mining company transforming itself into a bingo hall operator, enlisted Arlitt Financial to handle its investor relations for six months in return for $3,800 per month. At the time of Mr. Arlitt's first engagement with Cradle Mountain, the company's stock was changing hands for just under 40 cents per share. The share price quickly went into a slide and six months after Mr. Arlitt was hired Cradle Mountain shares were fetching 15 cents in very light trading. In February of 1996, Cradle Mountain again hired Arlitt Financial to perform investor relations and financial consulting services for a six-month term in exchange for $5,000 per month plus appropriately invoiced expenses to a maximum of $1,000 per month. At the time of his second engagement with Cradle Mountain, which was then pursuing registration as a gaming supplier, the company reported that Mr. Arlitt did not hold any interest, direct or indirect, in its securities. A little over a month after being hired for the second time, Mr. Arlitt evidently discovered the Internet as a medium for touting and began feverishly pumping Cradle Mountain in a stock forum. "DON'T MISS OUT ON THE CASINO DEAL EVERYONE'S TALKING ABOUT!!!" Mr. Arlitt wrote on March 18, 1996, using his own name rather than the aliases he would later employ including "The Professional Trader" and, possibly by a remarkable coincidence, "King Tutenkamen." Mr. Arlitt went on to claim that the same group that had taken AGC Americas Gold Corp., a company that will be discussed in more detail below, from 50 cents per share to $5.50 per share in 1995 had pegged Cradle Mountain as their number-one deal for 1996. "THEY EXPECT TO TAKE IT EVEN HIGHER THAN AGC AND WITH PLENTY OF GOOD REASON AND SOLID BACKING FROM OUT OF COUNTRY," the tout wrote. Mr. Arlitt said that the share price, which was just flirting with 50 cents, should skyrocket as the company released major news regarding pending deals, hinting that it could exceed $20 per share. "THIS LOOKS LIKE IT COULD BE THE BIGGEST CASINO/GAMING DEAL OF THE YEAR," the tout proclaimed, not bothering to disclose his association with the company. "DON'T MISS OUT ON THIS ONE!!!" Mr. Arlitt posted the same tout twice on March 18, 1996, but did not draw any public responses. Two days later, however, he was back with more. "HOT!!! CASINO/GAMING DEAL!!!" the tout began, going on to claim that quite a few announcements of deals for casino operations were expected over the next few weeks. "THE MOVE ON THE SHARE PRICE HAS BEGUN SO DON'T MISS OUT IF YOU WANT TO GET IN AT THESE LEVELS!!!" Mr. Arlitt wrote on March 20, 1996, as the share price hovered at 50 cents with less than 175,000 shares changing hands. A little more than an hour later, the tout blasted out a series of identical messages headed "HOT FLASH UPDATE!!!" urging investors to pile in before the share price rocketed on imminent news. "FOR ALL OF YOU WHO HAVEN'T BEEN ABLE TO GET YOUR SHARE POSITIONS YET, OR THOSE WHO WANT TO BUY MORE BEFORE THE SHARE PRICE SHOOTS OVER THE $1 LEVEL AND SKYROCKETS ON UPWARDS, LUCK IS ON YOUR SIDE!!!" Mr. Arlitt wrote. "YOU STILL HAVE TIME BEFORE THE PRESS RELEASE HITS TO ACCUMULATE BUT BE FOREWARNED, THE SHARE PRICE CONTINUES TO CLIMB THE LONGER YOU WAIT!!!" the tout claimed. Even "back in the day," as the saying goes, savvy investors had little truck with blatant Internet stock pumping and Mr. Arlitt's shrieking series of six identical messages drew a reaction from other participants. "Nice post, John," Rick Ackerman wrote in a beguilingly friendly opening. "I'm not one for flaming, but your message has got such an inordinate amount of class, all of it low, that I had to congratulate you." "Put a sock in it!" Guy Gordon chimed in to Mr. Arlitt. "Must be really hot if you gotta post it 6 times and ALL IN CAPS," Rhett Thompson remarked. "There's no credibility here, sorry dude." "I'm an investor in Cradle Mountain, but if you think that this will do the stock much good, you're a damn fool!" Johan van Slooten wrote. Mr. Arlitt took the time to respond sulkily to Mr. Ackerman's message. |
