UNITED STATES SECURITIES AND EXCHANGE COMMISSION
LITIGATION RELEASE NO. 16500 / April 4, 2000
Securities and Exchange Commission v. Stephen B. Marek and Dominic Roelandt, No.Civ. 00-600-PHX-EHC (USDC D.Az.)
The Commission announced today that it has filed a federal court action to halt the fraudulent touting over the Internet of 35 microcap companies. The Commission's complaint names as defendants Dominic Roelandt of Belgium, using the name "Coldstocks," and Stephen B. Marek, formerly of Salome, Arizona and now located in British Columbia, using the names "BigProfitNews" and "Bulls-Eye Stocks." The complaint alleges that, often in combination, Roelandt and Marek touted the stocks in free e-mail newsletters and on Internet websites in the names of the three entities from at least June 1999 through March 17, 2000. The complaint further alleges that the e-mail messages or websites contained various false and misleading statements concerning the claimed performance of Marek's and Roelandt's past stock picks, their trading intentions, and compensation received by Marek. The Commission's action, filed in the U.S. District Court in Phoenix, Arizona, seeks a temporary restraining order to prohibit Roelandt and Marek from violating the antifraud provisions of the federal securities laws, a freeze of Marek's assets, an accounting and repatriation of assets.
The complaint further alleges that nearly all of Roelandt's and Marek's touts caused the issuers' stock price and volume to increase significantly in the short term with most prices returning to pre-tout levels within a week or two. According to the complaint, in several instances, Roelandt and Marek sold their personal holdings in the stocks immediately after sending the e-mail messages to thousands of subscribers, thereby realizing at least $41,958 and $100,835 in profits, respectively.
The complaint alleges that Roelandt and Marek violated Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.
The Commission wishes to thank the British Columbia Securities Commission for its assistance in this matter.
Donald M. Hoerl, Associate Regional Administrator
Katherine Addleman, Assistant Regional Director of Enforcement
Michael R. MacPhail, Deputy Assistant Regional Director
Central Regional Office, (303) 844-1000