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SEC (Finally) Begins Investigation Into CYNK's 36,000% Rise (And Fall)

Tyler Durden's picture




 

Over six weeks ago we were the first to bring the investing world's (and SEC's) attention to CYNK technologies - a revenueless, assetless 'social network' shell that rapidly exploded in price and market cap soared to $6 billion. Since then it has come crashing back to 'sanity' levels - i.e. worthless - and now, as WSJ reports, The Securities and Exchange Commission is investigating. Their initial findings show a number of 'repeat offenders' linked to several stocks that suffered suspicious trading - just as we noted here...

 

As WSJ reports,

Even in the boom-and-bust universe of penny stocks, Cynk was a supernova—soaring 36,000% before the SEC suspended trading, then losing almost all of the gains after the halt was lifted.

 

Cynk's eye-popping valuation—given it reported no assets and only one employee—briefly made it the talk of Wall Street. But the affair also highlighted a complex web of people who were connected to Cynk and other microcap companies that have soared and sagged.

 

Peter Messineo, a 53-year-old accountant from Palm Harbor, Fla., is the auditor being scrutinized. He is one of a number of "repeat players" linked to several stocks that suffered suspicious trading who are being looked at by the SEC, as it shifts its tactics in its battle against penny-stock fraud, the people said.

 

 

 

 

The SEC is looking at whether some lawyers and accountants are liable for helping to enable penny-stock frauds, either by signing off on phony information or simply not asking the right questions, said people close to the agency.

 

...

 

Mr. Messineo, who hasn't been accused of any wrongdoing, said he was just a "bystander" at the Cynk stock blowup and there is no reason he should come under scrutiny. "The SEC should look into whatever they want to, that's their job. But I had no connection to any suspicious trading and I stand by my audits," he said.

 

The Public Company Accounting Oversight Board, which polices auditors, said its routine 2011 inspection of Mr. Messineo showed "deficiencies" in his audits.

 

...

 

The SEC still is investigating what happened with Cynk, said people close to the agency. It isn't clear who, if anybody, made significant profits from the stratospheric stock increase. A representative of Cynk couldn't be reached for comment.

*  *  *

In summary - you're welcome SEC. But, of course, all the time the Fed is encouraging the dash-for-trash trade with its ever increasing put strike, this kind of fraud will continue to find willing get-rich-quick investors to to fuel the insanity.

 

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Mon, 08/18/2014 - 20:48 | 5112045 SafelyGraze
SafelyGraze's picture

"Over six years ago we were the first to bring the investing world's attention to JPM - a revenueless, assetless 'financial network' shell that rapidly exploded in price"

the SEC is On It!

 

Mon, 08/18/2014 - 21:39 | 5112283 Davalicious
Davalicious's picture

These people will be tried for the crime of being criminals without being Jewish enough. Madoff's crime was swindling too many Jews.

Mon, 08/18/2014 - 20:57 | 5112074 Dr Strangemember
Dr Strangemember's picture

I guess this gave the last one to make millions on this scam enought time to close the account and transfer the funds offshore... a tax inversion of sorts if you will.  

Good job guys!  Go get 'em!!!!!

 

Mon, 08/18/2014 - 21:43 | 5112306 logicalman
logicalman's picture

Anyone seriously studying tbe banking system would benefit from a look at 1911 Thomson Dictionary of Banking.

Very instructive and available in .pdf format.

Not hard to find if you are serious about understanding.

 

Mon, 08/18/2014 - 21:01 | 5112087 fauxhammer
fauxhammer's picture

"Well, that's another fine Messineo you've got me into"

Mon, 08/18/2014 - 21:04 | 5112101 mister maghrebi
mister maghrebi's picture

In academia , we refer to this as a ponzi scheme.........

Mon, 08/18/2014 - 21:13 | 5112145 Da Yooper
Da Yooper's picture

Look at it this way

 

The SEC has finely gotten around to the

 

twiddling their thumbs stage

 

they will dick around for 4 - 6 weeks & then

 

every one will for get about it

 

but the SEC can say they tried & found nothing

Mon, 08/18/2014 - 21:07 | 5112115 pauhana
pauhana's picture

Too busy watching porn.

Mon, 08/18/2014 - 21:10 | 5112124 tyler
tyler's picture

Please take a shower bro, you smell like envy and not in a good way.  For real, a $15 stock so what?  Puke much

Mon, 08/18/2014 - 21:18 | 5112169 TeraByte
TeraByte's picture

Rich and dumb not seeing the inevitable deserved the total screwing. Call for serfs again to cover the losses.

Mon, 08/18/2014 - 21:27 | 5112200 alexcojones
alexcojones's picture

Media never mentioned SEC Records kept in

WTC-7. Wonder why not?

SEC Records destruction in WTC, Mayor Ghoul's "Disaster" HQs

Mon, 08/18/2014 - 21:51 | 5112345 orangegeek
orangegeek's picture

The SEC monkeys must have grown tired of watching porn, so what the fuck, may as well do some work for a change.

Mon, 08/18/2014 - 22:15 | 5112479 Bilderberg Member
Bilderberg Member's picture

Cut em some slack Tyler, do you have any idea how hard its been for them to try and unravel the MF Global fiasco???

Mon, 08/18/2014 - 22:25 | 5112502 Pascal1967
Pascal1967's picture

Peter, Dale and Harold,

You are my heroes. Sorry Tyler called The Feds on your ass and blew a good thing. I need to pay more attention ... let me know of your next pump-and-dump penny stock plan. I need to get in on that action.

Tue, 08/19/2014 - 00:01 | 5112917 user2011
user2011's picture

Yawn.... SEC will only pick on someone small and defenseless. I think some big players are involved with this.
SEC investigation will drag on and on until no one cares. Same as usual, crooks with connections gets away everytime.

Tue, 08/19/2014 - 00:30 | 5113015 McCormick No. 9
McCormick No. 9's picture

CYNK....CYYK!

Tue, 08/19/2014 - 01:01 | 5113105 smcapmachine
smcapmachine's picture

Broken clock it right twice a day

Tue, 08/19/2014 - 01:40 | 5113157 No More Bubbles
No More Bubbles's picture

What a joke. A penny stock that fooled a few clowns.  Who gives a fuck.  How about looking into who the crooks that have incessantly pumped NFLX, CMG, AAPL, AZO and many other bloated bubble stocks to the moon over the last few years!   ---- CRICKETS ----

Tue, 08/19/2014 - 02:44 | 5113231 OneTinTrooper
OneTinTrooper's picture

Now that they got the volume on high with the white v. black thing --- they can pretty much wrap up anything they want without us knowing about it.

Tue, 08/19/2014 - 07:39 | 5113486 NoPension
NoPension's picture

I once heard of this guy. I don't have a name or date, it's just stuck in my brain for years.

He got " approved" to bid on .gov contracts. A one man show, sitting at a computer. He would scan the bid requests, and look for obscure shit. Weird nomenclature .gov speak stuff. For example, and I'm making this up;

Qty,500 - Synthetic Rectal Apiture Support Device. ( plastic toilet seat, Home Depot, $8.95)

And put in a bid for $25,756.37
And because he was the only bidder.......

And I don't care what it is, if your getting enough bucks for it, you can supply.

I'm positive variations of this game are still played.

Do NOT follow this link or you will be banned from the site!