Lorsin, Inc., Loretta M. Lockhart, Craig K. Hjalmarson, Russell Management, Inc., George R. Siembida, Harold Engel, Jr., Microcap Marketing, Inc., and Shane M. Nelson Robert G. Mahony, Administrative Law Judge

Securities Act of 1933
Release No. 8308 / October 23, 2003

Administrative Proceeding
File No. 3-11310

Cease-and-Desist Proceedings Instituted Against Lorsin, Inc., Loretta M. Lockhart, Craig K. Hjalmarson, Russell Management, Inc., George R. Siembida, Harold Engel, Jr., MicroCap Marketing, Inc., and Shane M. Nelson

On October 23, 2003, the Securities and Exchange Commission ("Commission") instituted cease-and-desist proceedings against alleged Internet stock promoters Lorsin, Inc. ("Lorsin"), Loretta M. Lockhart ("Lockhart"), Craig K. Hjalmarson ("Hjalmarson"), Russell Management, Inc. ("Russell Management"), George R. Siembida ("Siembida"), Harold Engel, Jr. ("Engel"), MicroCap Marketing, Inc. ("MicroCap Marketing"), and Shane M. Nelson ("Nelson").

The Division of Enforcement ("Division") alleges that Energy & Engine Technology Corporation ("Energy & Engine"), a public company in Plano, Texas that maintains a natural gas gathering system, hired former stock promoter Siembida, of Depew, New York, and his company, Russell Management, to promote Energy & Engine on the Internet. Energy & Engine paid Siembida in stock that was improperly registered pursuant to a Form S-8 Registration Statement. (Form S-8 registration is not available for stock issued as compensation for stock promotion services.) Siembida subcontracted with Engel, who operates a small cap stock promotion website, WillyWizard.com, to promote Energy & Engine. To compensate Engel, Siembida transferred some of the shares he received from Energy & Engine to Engel.

The Division alleges that Engel, in turn, subcontracted with two other promoters, Hjalmarson and Nelson, to profile Energy & Engine on the Internet. Hjalmarson, of Kill Devil Hills, North Carolina, operates a website, GreedOrFear.com, through a corporation named Lorsin, which is headed by Lockhart, also of Kill Devil Hills. Nelson, of Bethany, Illinois, heads MicroCap Marketing, which promotes small cap companies on the Internet. Engel paid Hjalmarson and Nelson with a portion of the Energy & Engine shares he received from Siembida.

The Division further alleges that Engel and Nelson touted Energy & Engine on their websites, and that Hjalmarson distributed Energy & Engine press releases over the Internet. The promotion coincided with a 68 percent rise in the price of Energy & Engine's stock, from $0.29 to $0.49 per share, and average daily trading volume that was over 600% higher that the stock's historical daily volume. Siembida, Engel, Hjalmarson, and Nelson sold the stock that they had received for a combined total of over $14,000.

According to the Division's allegations, Siembida obtained the Energy & Engine shares in an unregistered offering with a view to distributing the stock to the public, making him an underwriter in a distribution of Energy & Engine stock. By participating in this distribution, Energy & Engine, Russell Management, Siembida, Engel, Lorsin, Hjalmarson, Lockhart, MicroCap Marketing, and Nelson violated Sections 5(a) and 5(c) of the Securities Act.

The Division also alleges that Nelson and MicroCap Marketing participated in a second illegal stock distribution with another small cap issuer, ProActive Computer Services, Inc. ("ProActive"). ProActive, a Houston-based computer services provider, hired Nelson and MicroCap Marketing to promote ProActive in exchange for a combination of restricted and purportedly unrestricted ProActive shares. ProActive arranged for a third-party shareholder to transfer 300,000 ProActive shares to Nelson's brokerage account. Nelson posted ProActive profiles on his websites and touted ProActive in his electronic newsletter. Nelson sold the ProActive shares he received from the third-party shortly after receiving them for $1,340.50.

The Division alleges that Nelson obtained the ProActive shares with a view to distributing them to the public from a person directly or indirectly controlling or controlled by ProActive, or under direct or indirect common control with ProActive. Therefore, the stock was restricted and could not be sold to the public for one year.

The Division further alleges that another issuer, whose stock was traded on the OTC Bulletin Board, hired Lorsin to promote it on the Internet. To pay for the promotion, the issuer directed two shareholders to transfer a total of 30,000 of its shares to Lorsin. Following the launch of Lorsin's promotional campaign, Lorsin sold a portion of the stock it had received from the issuer for $1,249.

According to the Division's allegations, Lorsin obtained the issuer's shares with a view to distributing them to the public from a person directly or indirectly controlling or controlled by the issuer, or under direct or indirect common control with the issuer. Therefore, the stock was restricted and could not be sold to the public for one year.

The Division alleges that Lorsin, Lockhart, Hjalmarson, Russell Management, Siembida, Engel, MicroCap Marketing, and Nelson violated Sections 5(a) and 5(c) of the Securities Act. A hearing will be scheduled before an administrative law judge to determine whether the allegations in the Order are true and, if so, whether Lorsin, Lockhart, Hjalmarson, Russell Management, Siembida, Engel, MicroCap Marketing, and Nelson should be ordered to cease and desist from committing or causing violations of and any future violations of Sections 5(a) and 5(c) of the Securities Act, and whether they should be ordered to disgorge the proceeds of their conduct.

The Commission directed that the administrative law judge shall issue an initial decision in this matter within 300 days from the date of service of the Order Instituting Proceedings.