U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 21656 / September 20, 2010
Securities and Exchange Commission v. BIH Corporation, et al., Civil Action No. 2:10-CV-577-FTM-29DNF (M.D. FL) (September 20, 2010)
The Securities and Exchange Commission filed a civil action in the United States District Court for the Middle District of Florida against BIH Corporation, Wayne A. Burmaster, Jr. of Staten Island, New York and Edward W. Hayter of Brooklyn, New York, for antifraud and registration violations and against North Bay South Corporation, Bimini Reef Real Estate, Inc., Riverview Capital, Inc., Christopher L. Astrom of Gulfport, Florida, and Damian B. Guthrie of Ocala, Florida for registration violations.
According to the SEC's complaint, Burmaster and Hayter implemented a pump-and-dump scheme involving BIH stock. The SEC alleges that as part of the scheme, Burmaster and Hayter illegally distributed BIH's stock to North Bay, Bimini Reef, and Riverview, which were controlled by Burmaster, Astrom, and Guthrie respectively. It is also alleged that these entities then dumped more than $1 million of BIH's stock and divided illegally obtained sales proceeds among themselves and Baron International, Inc., Beaver Creek Financial Corporation, and The Caddo Corporation. The SEC further alleges that Burmaster and Hayter pumped up the price of BIH's stock by disseminating false and misleading press releases and placing false information on BIH's website regarding, among other things, the identity of the individuals directing BIH's affairs, BIH's operations and business relationships, and BIH's stock and dividend payments.
The SEC alleges that BIH, Burmaster, and Hayter violated Sections 5(a), 5(c), and 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, and aided and abetted BIH's violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. The SEC also alleges that North Bay, Bimini Reef, Riverview, Astrom, and Guthrie violated Sections 5(a) and 5(c) of the Securities Act. The complaint seeks a judgment against all defendants providing for injunctions, disgorgement with prejudgment interest, civil money penalties, and penny stock bars against Burmaster, Hayter, Astrom, and Guthrie. The complaint also seeks disgorgement of ill-gotten gains with prejudgment interest against relief defendants Baron, Beaver Creek, and Caddo.
The Commission acknowledges the assistance of the Financial Industry Regulatory Authority (FINRA) in this matter.
See Also: SEC Complaint