Great White Marine &Recreation, Inc

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

LITIGATION RELEASE NO. 16364 / November 18, 1999

SEC v. Great White Marine & Recreation, Inc.

W-99-CA-230, USDC, WD/TX [Waco Division]

On November 16, 1999, Judge Walter R. Smith of the United States District Court for the Western District of Texas in Waco ordered A. Colin Smith, of Waco, jailed for contempt. Judge Smith ordered Mr. Smith incarcerated until (1) he provides the accounting of funds that Judge Smith had ordered previously and that is to detail, among other things, all funds received from investors or sales of stock and disbursed by Mr. Smith and the company, or (2) he posts a $100,000 bond.

In its Complaint, the Commission alleges that Great White Marine and Recreation, Inc., a Waco-based corporation once controlled by Mr. Smith, offered and sold unregistered shares of its stock through false statements in press releases, in promotional brochures, in internet website postings and in a Form 10-SB filed with the Commission. The Complaint alleges that Great White and Mr. Smith raised at least $10.8 million through their fraudulent activities, that Mr. Smith diverted at least $3.5 million to his own uses and that Great White made a $1 million "dividend payment as part of a "Ponzi" scheme.

The Commission is seeking permanent injunctive relief against Great White, and preliminary and permanent injunctive relief against Mr. Smith. Additionally, the Commission is seeking from Great White and Mr. Smith repatriation of funds from foreign accounts, disgorgement of ill-gotten gains (with prejudgment interest) and statutory civil monetary penalties. The Commission is also seeking the return of monies from Kenneth Ursery, Mr. Smith's son-in-law, and from Lourdes Smith, his ex-wife.