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U.S. Securities and Exchange Commission

UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION

Securities Exchange Act of 1934
Release No. 50826 / December 9, 2004

Admin. Proc. File No. 3-11596


In the Matter of

GRAHAM ANDREWS,

Respondent.



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ORDER MAKING FINDINGS AND IMPOSING REMEDIAL SANCTION BY DEFAULT

The Securities and Exchange Commission (Commission) issued its Order Instituting Proceedings (OIP) on August 24, 2004, pursuant to Section 15(b)(6) of the Securities Exchange Act of 1934 (Exchange Act). Respondent Graham Andrews (Andrews) was personally served with the OIP on October 14, 2004, and his Answer was due by November 3, 2004. See 17 C.F.R. 201.160(a), .220(b); OIP at 4. A telephonic prehearing conference was held on October 27, 2004, which Andrews failed to attend. To date, Andrews has not filed an answer nor has he otherwise attempted to defend the proceeding brought against him.

On November 17, 2004, the Division of Enforcement (Division) filed a motion for entry of a default order against Andrews. On November 23, 2004, I issued an order requiring Andrews to show cause on or by December 3, 2004, why he should not be held in default and why he should not be barred from participating in an offering of penny stock. To date, Andrews has failed to show such cause.

Andrews is in default for failing to file his Answer within the time proscribed and for failing to appear at a scheduled prehearing conference. See 17 C.F.R. 201.155(a), .220(f), .221(f). As authorized by Rule 155(a) of the Commission's Rules of Practice, 17 C.F.R. 201.155(a), I find the following allegations in the OIP to be true:

Andrews, age forty-nine, is a citizen of the United Kingdom and currently resides in Monaco. Between December 1998 and August 2001, Andrews was the president, chief executive officer (CEO), and a director of AbsoluteFuture.com (AFTI) and its predecessor private company, AbsoluteFuture Tech, Inc. (AbsoluteFuture Tech). During the relevant period, Andrews participated in an offering of AFTI stock, which was a penny stock.

AFTI was a Nevada corporation with its headquarters in Bellevue, Washington. AFTI, a software company, was formed in May 1999 through a reverse merger between AbsoluteFuture Tech and Corporate Tours and Travel, Inc., a public shell corporation. During the relevant period, AFTI's stock was traded on the NASD's Over-the-Counter Bulletin Board.

On July 28, 2004, the United States District Court for the Southern District of New York entered a final judgment of default against Andrews (i) permanently enjoining him from, directly or indirectly, violating Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933 (Securities Act) and Sections 10(b) and 13(a) of the Exchange Act and Rules 10b-5, 12b-20, and 13a-1 thereunder; (ii) ordering him to pay disgorgement of $65,000 of his ill-gotten gains from the conduct alleged, plus prejudgment interest in the amount of $19,601.41; (iii) ordering Andrews to pay the maximum third-tier civil penalty authorized by Securities Act Section 20(d)(2) and Exchange Act Section 21(d)(3); and (iv) barring him from acting as an officer or director of any issuer that has a class of securities registered pursuant to Exchange Act Section 12 or that is required to file reports pursuant to Exchange Act Section 15(d).

The final judgment was based on a complaint filed by the Commission on October 11, 2001, which alleged that Andrews violated or aided and abetted violations of Securities Act Sections 5(a), 5(c), and 17(a) and Exchange Act Sections 10(b) and 13(a) and Rules 10b-5, 12b-20, and 13a-1 thereunder by participating in a scheme to manipulate the stock price of AFTI, where Andrews served as CEO. The Commission sought a permanent injunction from future violations of the above provisions, disgorgement of ill-gotten gains, prejudgment interest, civil penalties, and an officer and director bar against him.

The complaint alleged that, from July 1999 through April 2000, Andrews alone and together with others engaged in a fraudulent scheme to manipulate the price of AFTI stock. As part of the scheme, Andrews caused AFTI to issue four press releases in July and August 1999, which contained false and misleading statements about AFTI's relationships with third parties and the potential business prospects that would result from those relationships.

The Commission's complaint further alleged that, starting in November 1999, Andrews conspired with other defendants in the case to use two false Form S-8 registrations to place 4.1 million unrestricted AFTI shares under the control of the other defendants for use in the manipulative trading. Andrews caused AFTI to purportedly register the shares in December 1999 and January 2000 and issue them to entities controlled by the other defendants, including Berkshire Capital Partners, Inc. (Berkshire), Commonwealth Partners NY LLC (Commonwealth Partners), Dottenhoff Financial, Ltd. (Dottenhoff), Galton Scott & Golett, Inc. (Galton), and Zimenn Importing and Exporting, Inc. (Zimenn). The shares purportedly were issued in exchange for consulting services.

The Commission's complaint also alleged that Andrews caused AFTI to issue the shares even though the shares were not eligible for registration on Form S-8 because the other defendants did not intend to provide bona fide consulting services in exchange for them. Three million of the 4.1 million shares were issued to Berkshire, Dottenhoff, Galton, and Zimenn but were not eligible for registration because those shares were not issued in exchange for bona fide services. The additional 1.1 million shares issued to Commonwealth Partners were not eligible for registration because those shares were issued explicitly in exchange for the promotion and manipulation of AFTI's stock and the raising of capital for AFTI by creating the appearance of an active market for AFTI shares. In addition, in each case, the shares were issued to corporate entities, not to natural persons. As a result, the Form S-8 registration statements that Andrews caused AFTI to file were invalid and therefore no registration was in effect for the shares.

The Commission's complaint also alleged that the other defendants used the entities to which the shares were issued to sell the unregistered stock to the public. Andrews participated in another defendant's manipulative use of the S-8 shares by causing AFTI to issue at least two press releases during January and March 2000, one of which was false, that were timed to coincide with that other defendant's trading.

The Commission's complaint further alleged that, as part of the scheme, AFTI received a total of $850,000 from the other defendants, and Andrews personally received at least $65,000 of those proceeds in February 2000. In December 1999 and January 2000, Andrews caused AFTI to make false statements in filings with the Commission in order to register a total of 4.1 million shares, which it issued to entities controlled by the other stock promoter defendants. In particular, AFTI falsely represented that the entities would provide bona fide consulting services in exchange for the shares. Andrews, however, provided the stock to the other defendants for sale to the public as part of the scheme to manipulate the price of AFTI stock.

In view of the foregoing, I find it necessary and appropriate in the public interest that Andrews be barred from participating in an offering of penny stock.

ORDER

IT IS ORDERED THAT, pursuant to Section 15(b) of the Securities Exchange Act of 1934, Graham Andrews is hereby barred from participating in an offering of penny stock.

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Lillian A. McEwen
Administrative Law Judge


http://www.sec.gov/litigation/admin/34-50826.htm


Modified: 12/09/2004