U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 19883 / October 25, 2006
Conversion Solutions Holdings Corporation and Rufus Paul Harris a/k/a Paul Rufus Harris, Civil Action No. 1:06-CV-2568-CC N.D. GA (October 24, 2006)
The Securities and Exchange Commission (Commission) announced today that it has filed a complaint in the United States District Court for the Northern District of Georgia against Conversion Solutions Holdings Corp. (Conversion), located in Kennesaw, Georgia, and Rufus Paul Harris a/k/a Paul Rufus Harris (Harris) of Adairsville, Georgia. Harris is the Chief Executive Officer of Conversion. The Complaint seeks, among other things, injunctions, disgorgement of ill-gotten gains and civil penalties. The Commission also filed an application for a temporary restraining order and other relief.
The Complaint alleges that, from September 26, 2006 through the present, Conversion has been disseminating, through press releases and Commission filings, flagrantly false information in connection with its assets. As a result of the false information, both the trading volume and price of Conversion's stock have increased significantly. The Complaint alleges, among other things, that Conversion and Harris misrepresented through press releases, and in Forms 8-K and 10-KSB filed by Conversion, that it had acquired ownership of two separate Venezuelan bond issues with face values of five billion Euros and five hundred million dollars.
The Complaint alleges that defendant Conversion has violated Sections 10(b) and 13(a) of the Securities Exchange Act of 1934 (Exchange Act) and Rules 10b-5, 12b-20, 13a-1 and 13a-11 thereunder, and that defendant Harris has violated Section 10(b) of the Exchange Act and Rules 10b-5 and 13a-14 thereunder, and has aided and abetted Conversion's violations of Section 13(a) of the Exchange Act and Rules 12b-20, 13a-1 and 13a-11 thereunder.
The Commission also suspended trading in Conversion securities for a period of ten business days. See Release No. 34-54645 (October 24, 2006).
The Commission thanks the Georgia Securities Division and the NASD for their assistance in this matter.