SEC Charges Microcap Issuer and Its CEO and Former Director for False Merger and Dividend Announcements
Litigation Release No. 25456 / July 28, 2022
Securities and Exchange Commission v. Patient Access Solutions, Inc., et al., No. 1:22-cv-04447 (E.D.N.Y. filed July 28, 2022)
On July 28, 2022, the Securities and Exchange Commission charged Patient Access Solutions, Inc. ("PASO"), its CEO, Bruce Weitzberg ("Weitzberg"), and a former PASO Director, Joseph Gonzalez ("Gonzalez") with issuing press releases and tweets falsely claiming that PASO was actively negotiating a merger and planning to issue dividends.
According to the SEC's complaint, from approximately January to April 2020, Weitzberg and Gonzalez caused PASO to issue press releases and tweets that created the false impression that PASO was actively negotiating a merger with another entity. As alleged, Gonzalez, with Weitzberg's authorization, also promoted the fictional narrative of an upcoming merger by posting public letters falsely claiming that Gonzalez and a member of PASO's board of advisors purchased millions of PASO shares. The complaint alleges additional deceptive acts by Gonzalez, including impersonating a chiropractor to promote PASO on a radio talk show, and misleadingly posing as an unaffiliated investor-using a pseudonym-to post false and misleading statements promoting the merger and insider purchases on an Internet chat board.
The SEC's complaint, filed in federal district court in Brooklyn, New York, charges PASO, Weitzberg, and Gonzalez with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. Without admitting or denying the allegations of the SEC's complaint, Gonzalez consented to the entry of a judgment that imposes a permanent injunction, $5,256 in disgorgement plus prejudgment interest thereon, a $120,000 penalty, an officer and director bar, and a penny stock bar. The settlement is subject to court approval. In its action, the SEC seeks injunctions, disgorgement plus prejudgment interest and civil penalties against PASO and injunctions, disgorgement plus prejudgment interest, civil penalties, an officer and director bar and a penny stock bar against Weitzberg.
The SEC's investigation was conducted by Liora Sukhatme and Gerald A. Gross of the New York Regional Office and supervised by Sheldon L. Pollock. The SEC's litigation is being handled by Ms. Sukhatme and Philip A. Fortino.