Las Vegas Sun

March 2, 2015

Currently: 61° — Complete forecast | Log in | Create an account

SEC: Las Vegas company’s stock manipulated for profits

Related Document

The stock of a Las Vegas company selling an anti-aging product was manipulated by schemers who profited by having the company issue false information in press releases in 2006, federal regulators charged Thursday.

The Securities and Exchange Commission said the Las Vegas company, GH3 International Inc., was involved in a larger case it announced the same day.

Efforts to locate officials with GH3 for comment were unsuccessful. The Nevada Secretary of State's office indicates its state business registration has been revoked.

In the broader case, the SEC said it charged eight participants in a penny stock manipulation ring that allegedly pumped up the market prices of at least four stocks and generated more than $6.2 million in illicit profits when they dumped shares on the market.

The SEC alleges that Pawel Dynkowski, who lived in Newark, Del., carried out the market manipulation schemes with others he met through a penny stock Web site,, which it said is operated by Matthew Brown of Aliso Viejo, Calif.

The agency said Dynkowski, Brown, and other participants in the schemes often timed the manipulative trading to coincide with false or misleading press releases issued by the companies to hype the stock. The four companies were GH3, Asia Global Holdings Inc., Playstar Corp. and Xtreme Motorsports of California, Inc.

"As we allege in our complaint, Dynkowski and his accomplices around the country met through the Internet and together spun a web of deception that gave investors the false impression that there was a real demand for these stocks," Scott Friestad, deputy director of the SEC’s Division of Enforcement, said in a statement. "Dynkowski went so far as to himself write some of the misleading press releases that pumped these penny stocks so they could line their own pockets with millions of dollars."

The SEC’s complaint, filed in federal district court in Delaware, charges six others in addition to Dynkowski and Brown:

--Jacob Canceli of Mission Viejo, Calif., who the SEC says is a stock promoter.

--Gerard J. D’Amaro of Pompano Beach, Fla., said to be a stock promoter.

--Joseph Mangiapane Jr. of Laguna Niguel, Calif., said to be a registered representative at AIS Financial Inc. and whom the SEC says is currently CEO of Rubicon Financial Inc., which it said owned AIS Financial Inc. during the relevant time period.

--Nathan M. Michaud of Boston, said to be a web site designer.

--Marc J. Riviello of Redwood City, Calif., said to be a registered representative at AIS Financial Inc.

--Adam S. Rosengard of Voorhees, N.J., said to be a student at the University of Delaware during the relevant time period.

The U.S. Attorney’s Office in Delaware on Thursday also announced felony criminal charges against Dynkowski, Brown, Canceli, D’Amaro, Mangiapane and Riviello.

In the case of GH3, the government alleged the scheme netted $747,609 in illegal profits between October and December 2006. GH3 had purported to sell an anti-aging product called GeroVital H3, the government said.

The SEC said the alleged pump-and-dump scheme involving GH3 was orchestrated by Dynkowski with Brown.

The SEC said: "Brown introduced Dynkowski to a representative of GH3 and to Canceli, a penny stock promoter who participated in the scheme. Brown acted as a liaison between Dynkowski, Canceli and the issuer. Dynkowski and his associates used wash sales, matched orders, and other manipulative trading, timed to coincide with false, misleading and touting press releases by the company, to inflate the price of GH3 stock. Canceli provided the accounts from which Dynkowski subsequently sold purportedly unrestricted shares received from the issuer. The scheme culminated in mid-December 2006, with Dynkowski dumping 312 million shares of GH3 stock for total illicit proceeds of $747,609."

Join the Discussion:

Check this out for a full explanation of our conversion to the LiveFyre commenting system and instructions on how to sign up for an account.

Full comments policy

Previous Discussion: comments so far…

Comments are moderated by Las Vegas Sun editors. Our goal is not to limit the discussion, but rather to elevate it. Comments should be relevant and contain no abusive language. Comments that are off-topic, vulgar, profane or include personal attacks will be removed. Full comments policy. Additionally, we now display comments from trusted commenters by default. Those wishing to become a trusted commenter need to verify their identity or sign in with Facebook Connect to tie their Facebook account to their Las Vegas Sun account. For more on this change, read our story about how it works and why we did it.

Only trusted comments are displayed on this page. Untrusted comments have expired from this story.

No trusted comments have been posted.