UNITED STATES OF AMERICA
In the Matter of
Mark W. Lancaster,
|ORDER INSTITUTING CEASE-AND-DESIST PROCEEDINGS, MAKING FINDINGS, AND IMPOSING A CEASE-AND-DESIST ORDER|
The Securities and Exchange Commission ("Commission") deems it appropriate that cease-and-desist proceedings be instituted pursuant to Section 21C of the Securities Exchange Act of 1934 ("Exchange Act") against Mark W. Lancaster ("Lancaster").
In anticipation of the institution of these administrative proceedings, Lancaster has submitted an Offer of Settlement ("Offer"), which the Commission has determined to accept. Solely for the purpose of these proceedings and any other proceedings brought by or on behalf of the Commission or in which the Commission is a party, and without admitting or denying the findings herein, except that Lancaster admits jurisdiction of the Commission over him and over the subject matter of these proceedings, Lancaster has consented to the entry of this Order Instituting Cease-and-Desist Proceedings, Making Findings, and Imposing a Cease-and-Desist Order ("Order").
On the basis of this Order and the Offer submitted by Lancaster, the Commission finds1 that:
a. International Cavitation Technologies, Inc. ("ICT") is a Colorado corporation, located in Bixby, Oklahoma. The company's common stock is quoted on the Bulletin Board (a service of Nasdaq Stock Market, Inc.). As of September 21, 2001, there were 12,311,162 shares of its common stock outstanding.
b. Lancaster, age 45, is a resident of Midland, Texas. He works as a salesman for ICT on an independent contractor basis. Using the name MLSA Telecommunications, Lancaster has issued a small number of press releases for ICT and another publicly held company. Lancaster has no other experience in the investor relations or public relations areas. He has never been affiliated with a regulated entity and has no disciplinary history.
c. Lancaster drafted and caused Business Wire to issue a fraudulent press release on October 25, 2001. The release stated that "there are clear indications that [ICT's] Airborne Removal System (ARS) . . . will be able to remove, destroy and eliminate airborne bacteria, including the anthrax spore." The release further stated that "[i]n-field studies have been concluded [on airborne bacteria] and the company is now moving to final laboratory testing ... . "
d. These statements were false. Although ICT's ion collider technology has been shown to remove contaminants from water and soil, it has never been shown to remove contaminants from the air. Further, ICT has never developed an "Airborne Removal System." Moreover, ICT has not tested its technology's ability to remove or destroy airborne bacteria.
e. Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, prohibit persons from, directly or indirectly, in connection with the purchase or sale of securities by use of any means or instrumentality of interstate commerce or of the mails, or of any facility of any national securities exchange, employing any device, scheme or artifice to defraud; making any untrue statement of a material fact or omitting to state material facts necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading; or engaging in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person. Lancaster violated Section 10(b) of the Exchange Act and Rule 10b-5 thereunder by disseminating false and misleading information regarding the ability of ICT's technology to destroy anthrax bacteria, and the testing of such technology. Lancaster knew or was reckless in not knowing that these statements were false and misleading.
In view of the foregoing, the Commission deems it appropriate to accept the Offer submitted by Lancaster.
Accordingly, IT IS ORDERED that pursuant to Section 21C of the Exchange Act that Respondent cease and desist from committing or causing any violation and any future violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder.
By the Commission.
Jonathan G. Katz
|1||The findings herein are made pursuant to the Offer of Settlement of Lancaster and are not binding on any other person or entity in this or any other proceeding.|
|Home | Previous Page||