Legal
Joe Meuse

China Reverse Merger Banker Meuse Banned by the SEC

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A leading banker in China reverse merger deals was banned from the penny stock business for five years by the Securities and Exchange Commission. On January 8, the U.S. District Court for the Southern District of New York ordered Belmont Partners CEO Joseph Meuse to pay fines and penalties of $224,500. The SEC barred Virginia-based Belmont and Meuse from committing fraud in relation to a securities offering again but Meuse did not admit or deny guilt.
Joe Meuse
In December 2011 the government regulator alleged that the company and Joseph Meuse used fabricated and backdated documents to convince a transfer agent and an attorney writing an opinion letter to issue free-trading shares of Alternative Green Technologies (AGTI). The SEC also charged AGTI, its CEO Mitchell Segal, a business partner named Howard Borg and stock promoters for their roles in the scheme that resulted in unknowing investors purchasing fraudulently issued AGTI shares. “Shell packagers who buy and sell public companies for use by fraudsters have no rightful place in our markets,” said David Rosenfeld, Associate Director of the SEC’s New York Regional Office in 2011 after the SEC fraud suit was filed.

Deals

Santa Fe Gold Raises $3M in APO with Tyhee Gold

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Santa Fe Gold Corporation (SFEG) announced that it has raised $3,000,000 in a Non-Convertible Debentures transaction. The securities accrue interest at a rate of 18%. The investor was Tyhee Gold Corporation. Concurrently with this Placement, Tyhee Gold Corporation completed a reverse merger with the Company. The principal amount of the Debentures becomes due and payable upon termination of the merger agreement with the Investor or, following completion of the merger, will be converted to an intercompany loan.

Deals

Media IP Protection Company Completes $2M APO

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Rightscorp (RIHT), a company which sells technology to protect media companies from illegal content downloading, went public in a reverse merger and closed a private placement with an investor to raise $2 million. The Santa Monica, Calif.-based company completed the alternative public offering (APO) on Oct. 25, selling 950,000 units at 50 cents each to Hartford Equity. Each unit includes one common share and a five-year warrant to buy an additional share for 75 cents, to raise an initial $475,000. The company concluded an agreement with Hartford to purchase a total of $2 million in common stock and warrants over the next 14 months.

Deals
KonaRed

KonaRed Completes $1.3M APO

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A Hawaiian health food and juice maker completed an alternative public offering (APO) by reverse-merging with a shell company and raising $800,000 and exchanging stock for $500,000 in debt on October 10. The company, KonaRed Corp., merged into shell company TeamUpSport Inc., a defunct New Zealand company that had sought to develop an online network for sport fans. KonaRed sold the APO shares to Littlebird Capital, which purchased 1.7 million shares for 45 cents each, and purchased the debt from Maxam Capital Management in exchange for an additional 1.1 million shares. KonaRed announced it will seek to raise an additional $300,000 through a private placement of stock and warrants. The company intends to trade over-the-counter under the symbol KRED.