UNITED STATES OF AMERICA
In the Matter of
Mark E. Rice,
|ORDER INSTITUTING PUBLIC ADMINISTRATIVE PROCEEDINGS PURSUANT TO SECTION 15(b) OF THE SECURITIES EXCHANGE ACT OF 1934, MAKING FINDINGS, AND IMPOSING A PENNY STOCK BAR|
The Securities and Exchange Commission ("Commission") deems it appropriate and in the public interest to institute public administrative proceedings against Mark E. Rice ("Rice" or "Respondent") pursuant to Section 15(b) of the Securities Exchange Act of 1934 ("Exchange Act").
In anticipation of the institution of these administrative proceedings, Respondent has submitted an Offer of Settlement ("Offer"), which the Commission has determined is in the public interest to accept. Solely for the purpose of this proceeding, and any other proceeding brought by or on behalf of the Commission or to which the Commission is a party, Rice, without admitting or denying the findings herein, except as to the Commission's jurisdiction over him and over the subject matter of this proceeding, and the entry of the injunction described in paragraph IV. D. below, which is admitted, consents to the issuance of this Order Instituting Public Administrative Proceedings Pursuant to Section 15(b) of the Securities Exchange Act of 1934, Making Findings, and Imposing A Penny Stock Bar ("Order") and to the entry of the findings and the imposition of the remedial sanctions as set forth below.
Accordingly, IT IS ORDERED that said proceedings be, and hereby are, instituted.
Based on this Order and Rice's Offer, the Commission finds the following:
A. Rice, age 41, is a Texas resident who has a high school diploma. Rice has no experience in the securities industry. Since 1998, Rice has held himself out as an investment banker for developmental stage companies.
B. Global Connections, Inc. ("Global Connections") is a Nevada corporation with its principal offices in Denver, Colorado. It provides insurance technology marketing and support for consumers and insurance agents. Global Connections' stock is quoted in the National Quotation Bureau's Pink Sheets and is a penny stock within the meaning of Sections 15(b)(6) and 3(a)(51) of the Exchange Act and Rule 3a51-1 thereunder.
C. Pinnacle Business Management Inc. ("Pinnacle") is a Nevada corporation with offices in Clearwater, Florida. It is a holding company with a subsidiary engaged in consumer lending. Originally, Pinnacle was a wholly owned subsidiary of 300365 BC, Ltd. d/b/a Peakers Resources Company ("Peakers"), a British Columbia corporation. In 1997, Peakers incorporated Pinnacle Business Management, Inc. as a wholly owned subsidiary, and Peakers' shareholders exchanged all the outstanding shares of its stock for the stock of Pinnacle on a share-for-share basis. On March 3, 2000, Pinnacle acquired a reporting shell, MAS Acquisition XIX, Inc., through a stock-for-stock transfer. Pinnacle's stock is quoted on the Bulletin Board (a service of the Nasdaq Stock Market, Inc.) and is a penny stock within the meaning of Sections 15(b)(6) and 3(a)(51) of the Exchange Act and Rule 3a51-1 thereunder.
D. On March 5, 2002, in Securities and Exchange Commission v. Mark E. Rice et al. , Civil No. H:02CV00636 (S.D. Tex.), the United States District Court for the Southern District of Texas entered a final judgment permanently enjoining Rice from violating Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933 ("Securities Act"), Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, and Regulation M, Rule 101.
E. The injunction was based on the Commission's allegations that between approximately September 1999 and May 2000, Rice drafted and caused to be disseminated millions of unsolicited "spam" e-mail messages touting the stock of four issuers, including Pinnacle and Global Connections. Further, the Commission alleged that the messages regarding Pinnacle and Global Connections included false statements concerning, among other things: (a) the reasons why Global stock recently ceased being quoted on the OTC Bulletin Board; (b) the stock-picking track record of the person(s) responsible for the messages, i.e., Rice; (c) Rice's trading intentions; and (d) short-term stock price projections. Moreover, the Commission alleged that Rice sold shares of three of the issuers, including Global Connections, into the resulting inflated market.
F. Rice participated in offerings of the penny stocks of Global and Pinnacle.
Based on the foregoing, the Commission deems it appropriate and in the public interest to impose the sanctions specified in the Respondent's Offer.
Accordingly, IT IS ORDERED that Respondent be, and hereby is, barred from participating in any offering of a penny stock, including: acting as a promoter, finder, consultant, agent or other person who engages in activities with a broker, dealer or issuer for purposes of the issuance or trading in any penny stock; or inducing or attempting to induce the purchase or sale of any penny stock.
By the Commission.
Jonathan G. Katz
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