U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 18016 / March 6, 2003
SECURITIES AND EXCHANGE COMMISSION V. MICHAEL J. PIETRZAK, MAURICE W. FURLONG AND DONALD E. JORDAN, Civil Action No. 03C-1507 (N.D. Ill.)
SEC SUES OFFICERS OF HEXAGON CONSOLIDATED COMPANIES OF AMERICA, INC. AND REGISTERED ASSAYER
The Securities and Exchange Commission announced today that it has filed a complaint against three men for various violations of the federal securities law. The three defendants are Michael J. Pietrzak of Carol Stream, Illinois, Maurice W. Furlong of Reno, Nevada, and Donald E. Jordan of Henderson, Nevada. Pietrzak and Furlong are officers and directors of Hexagon Consolidated Companies of America, Inc. ("HCCA"), a development stage mining company headquartered in Reno, Nevada. Pietrzak is HCCA's general counsel, executive vice president and secretary, as well as a director. Furlong is HCCA's chairman, president and CEO. Defendant Jordan is a registered assayer who issued misleading reports that falsely stated that HCCA held ore and other minerals valued at more than $2 billion.
The complaint alleges a wide-range of securities law violations, including that misstatements were made by HCCA in filings with the Commission. Pietrzak and Furlong engaged in protracted efforts to fraudulently increase the stock price and value of the company by, among other means, filing false and misleading registration statements and periodic and current reports, and by issuing false press releases and a letter to shareholders. During the same time, Pietrzak and Furlong sold a total of more than 79.7 million shares of HCCA stock, fraudulently receiving at least $4.2 million. The complaint also alleges that from 1996 through 2001 HCCA, through the efforts of Pietrzak and Furlong, reported to the public that is was an entity with substantial assets when, in fact, it was virtually worthless. Defendant Jordan engaged in fraud when he issued false and misleading reports that valued HCCA's mining assets at more than $2 billion.
Pietrzak and Furlong are charged with violations of the antifraud provisions of Section 17(a) of the Securities Act of 1933 ("Securities Act") and Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act") and Rule 10b-5 thereunder. They are charged with misstatements in filings with the Commission that aided and abetted violations of Section 13(a) of the Exchange Act and Rules 12b-20, 13a-1, 13a-11, 13a-13 thereunder. Pietrzak and Furlong are also charged with aiding and abetting violations involving internal accounting controls and books and records violations of Sections 13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act. Pietrzak and Furlong are both charged with books and records violations of Section 13(b)(5) of the Exchange Act and Rules 13b2-1 thereunder. As a final count against him, Furlong is charged with violations of stock ownership reporting provisions of Sections 16(a) of the Exchange Act and Rules 16a-2 and 16a-3 thereunder.
As to the remaining defendant, Jordan is charged with violations of the antifraud provisions of Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. He is also charged with aiding and abetting violations of Section 13(a) of the Exchange Act and Rule 13a-1 thereunder.
The complaint asks the Court to issue permanent injunctions and to order disgorgement, prejudgment interest thereon and civil penalties against each defendant. The Commission also seeks orders against Pietrzak and Furlong barring them from serving as officers and directors in the future, and imposing a penny stock bar against them.