Penny Stock Promoters Barred
Federal judge Sidney A. Fitzwater of the United States District Court for the Northern District of Texas enjoined Ryan M. Reynolds of Dallas, TX, Timothy T. Page of Malibu, CA, Steven Fischer of Bonita Springs, FL, Phillip W. Offill, Jr., a Dallas attorney, RSMR Capital Group Inc. (RSMR), Page Properties LP, and ATN Enterprises LLC from violating Section 5 of the Securities Act of 1933.
The Commission’s complaint alleged that these individuals and entities violated the securities laws by acting as underwriters engaged in a scheme to evade the securities registration requirements by offering and selling the securities of one or more of six companies when no registration statements were filed or in effect to provide information to public investors. The six companies issued penny stocks, which are defined as equity securities trading at a price of less than five dollars per share, and the defendants initiated public trading in the over-the-counter market under the following trading symbols: American Television & Film Company (ATFT), Ecogate, Inc. (ECGT), Media International Concepts, Inc. (MEIC), Vanquish Productions, Inc. (VQPI), Auction Mills, Inc. (AUML), and Custom Designed Compressor Systems, Inc. (CUPY). The court also barred Reynolds, Page, Fischer, RSMR, Page, and Page Properties for seven years, and Offill permanently, from participating in the offer or sale of penny stocks. In addition, the court enjoined Reynolds, RSMR, Page, and Page Properties from violating Section 15(a) of the Securities Exchange Act of 1934 by engaging in the securities transaction without registering as brokers or dealers with the Commission. The court also ordered the defendants to pay disgorgement totaling $12,219,468 of profits from their unregistered securities sales plus prejudgment interest, and civil penalties of $120,000 each. In addition, the court ordered relief defendants Timothy Barham and his company Ballad Enterprises, Inc. of Henderson, Tennessee, and Bellatalia LP, a company owned by Reynolds, to disgorge funds they received from the defendants’ illegal stock sales. The Commission’s claims for remedies against Shane Mullholand and his company Dissemination Services LLC remain to be resolved. The court previously enjoined Arizona attorney, David Stocker and his company Curtis-Case Inc. for their violations of Section 5 of the Securities Act, and barred them from participating in penny stock sales.