Bangkok-based Brinton Group investment
firm boiler room scam
Into the Rough
07/01 - In a joint operation involving a multitude of both Thai
and international enforcement agencies the Brinton Group and the
Benson Dupont Capital Management had their boiler room operations
raided in Thailand. Complaints had been made concerning similar
activities from twenty-one other companies based in Bangkok.
The raids were the result of more than two years of investigations
by securities regulators in Australia, Hong Kong and New Zealand
following complaints from a large number of investors, especially
Australians, who had been solicited by telephone salespersons based
in Thailand to buy shares in another overseas market. High pressured
selling tactics were used and investors were then asked to send
money offshore where it was destined to stay.
It was established that the two groups of companies may be associated
with a larger group of entities and may also have belonged to an
international group based outside Thailand which engaged in international
money laundering. New evidence has emerged that the Bangkok operation
is part of a much bigger international scheme that's defrauded
Australians of more than $200 million.
Using different brand names of Brinton Group, Benson Dupont
Capital Management, Osiris Asia Pacific, Strategic Alliance Corporation,
Sigama Capital Management and Dreyfus Capital, advertised their businesses in brochures as securities brokers and investment
managers based in Thailand.
Initial investigations revealed that the groups frequently changed
their names and places of businesses thus creating difficulties
in tracking them down.
They attempted to conceal their business operations by renting
virtual office to act as switch board facilities to transfer calls
to other locations where they had a physical presence. More than
60 telephone lines had been installed in both locations where telephone
records show that frequent calls were made overseas by the more
than 70 foreign nationals engaged there including ten Australians,
three New Zealanders and numerous British and U.S. citizens.
Seven executives of the Brinton Group
namely 1) John Martin Kealy, of County
Tipperary, Ireland 2) Ronan Joseph Murray,
of Dublin, Ireland 3) Paul Mary Hickey,
4) Scott Campbell Fisher, 5) Jason
Garrick Rich, 6) Adrian Robert Wallis and
7) Steven Hooper were found to have engaged
in illegally conducting securities businesses without having
obtained a license from the SEC Thailand. Such activity is an
offense under their SEC Act and is punishable by maximum jail
terms not exceeding 5 years and a fine not exceeding 500,000
Ronan claims his operation is legitimate because the US companies
they're selling shares in, are real. The Brinton Group was engaged
by Golf.com through Tom Gallagher of Gallagher, Briody & Butler
to raise capital for Golf.com.
Gary Player, through his investment company, is actually a minority
shareholder in Golf.com, an ownership interest he reluctantly accepted
in lieu of market-rate endorsement fees. He licensed the rights
to use his name and likeness in connection with their equipment
in February 2000 but after they failed to pay royalties the license
was terminated in July of 2001.
Since that date, Mr. Player does not endorse Golf.com's products
in any way and has filed suit to enjoin them from using his name
and likeness altogether. He stated that he felt the Brinton Group
was a legitimate operation.
One investor who initially bought shares from the Brinton Group
in a public company called Gary Player Direct spent hundreds of
thousands of dollars worth at a time when the company was collapsing
financially. He was reassured that his shares would be transferred
into a new Gary Player named company. And that's exactly what happened.
The first company collapsed and delisted, and he received shares in the
private company called Gary Player Golf.com. He has since been optimistically
waiting over a year and a half for the new company to list publicly so
he can sell his shares.
More On The Brinton Group's Cold-Calling Scams
The Securities and Exchange Commission said yesterday that it
had filed additional criminal complaints against seven executives
of the Brinton Group for fraud and offering securities services
without a license.
The executives are John Martin Kealey, Ronan Joseph Murray, Paul
Mary Hickey, Scott Campbell Fisher, Jason Garrick Rich, Adrian
Robert Walls and Steven Hooper.
On July 26, the SEC and police raided the offices of two "boiler-room" operations, including the Brinton Group, for illegally operating securities
services without a licence.
Over 100 Thais and foreigners were arrested in the raids, which
followed a month-long SEC investigation in co-operation with Australian,
Hong Kong, and US authorities. The securities scheme was said to
have spanned 70 countries, with estimated damage to foreign investors
of around A$300 million, or 6.9 billion baht.
The SEC said pending further investigation, the seven executives
were identified as "responsible for the management of the
Brinton Group and had therefore conspired to operate securities
businesses in Thailand without having licences and to engage in
STOCK TRADING SCAM 28 July 2001
Brinton Group has long, shady history
The Brinton Group, whose staff was arrested on Thursday for alleged
illegal global stock trading operations, set up its Bangkok headquarters
on the 24th floor of Bangkok City Tower on Sathorn Road about one
The office housed several companies, all of which were registered
with the Commerce Ministry.
Their salespeople allegedly used high-pressure sales tactics to
sell overseas shares and investments and reportedly duped middle-class
investors out of millions of dollars. Most investors reportedly
lost about US$50,000 (Bt2.3 million) to $100,000 each.
Yesterday the Australian embassy in Bangkok was flooded with calls
from nervous investors in Australia who had purchased shares with
the firms raided, some having handed over up to 250,000 Australian
dollars (Bt5.76 million).
The Brinton Group allegedly has a long history in cold-calling
scams, having previously being based in the Philippines and the
Caribbean, and has sold IPOs (initial public offerings) and sourcing
venture capital for American companies and in Gary Player Direct,
a company run by the famous golfer's son.
Sources said retirees keen to speculate in quick money were especially
targeted. Tele-sales people were well trained and given scripts
to talk to prospective investors. The sales people often switched
offices and used different names. Their operations used virtual
mailboxes, and leased telephones and fax machines -- all of which
made it harder for authorities to gather evidence.
The money that they had solicited for stock investment was sent
to bank accounts in Hong Kong.
Prior to Thursday's raid, as many as 100 clients found that they
had been cheated, according to a source. Most were from Australia,
New Zealand and Hong Kong. The investors were initially lured into
the net with reported high returns especially from shares traded
on the US stock markets. They were asked to invest further, then
the operation would move to another location -- leaving the investors
in limbo. The two firms' 80 or so expatriate staff members were
mostly tourists in Thailand. Some were recruited from websites.
Peter Kell, executive director of consumer protection for the
Australian Securities and Investments Commission, or ASIC, said
the scams had drifted from America and Europe into Asia and were
now operating in Thailand, the Philippines and Hong Kong. "ASIC
alone has received many hundreds of complaints, and so we would
estimate that a lot more people have been called (by scammers)
than the number of complaints we have received," Kell told
the Australian Associated Press. At least one operator had raised
more than A$3 million from unsuspecting investors, he said.
Officers from the US Federal Bureau of Investigation and the Australian
Federal Police joined Thai police in the Bangkok bust.
"We are pleased to be able to provide investigative support
in this case and we anticipate long-term investigative follow-ups," FBI
agent Robert Cahill, legal attaché at the US Embassy, said
Representatives of Bangkok's legitimate brokering houses were
encouraged that Thai authorities had taken action against the increasing
number of boiler rooms. "It enhances Thailand's reputation
after being damaged by the emergence of these houses," said
Bob McMillen, chief executive of Seamico Securities. "But
I would like to see them follow it up and target the foreign currency
operators who are hitting the Thais as well."
Source: The Nation
Thai police charges eighty suspects in stock trading scam
Thai Police are looking for four other foreigners suspected of
masterminding a stock trading scam, a police source said yesterday.
Police believe there are six big bosses in the financial scam
and four of them eluded police when they raided two offices operating
under the name of the Brinton Group and Benson Dupont Capital Management
Scott Fisher, 34, an Australian, and Paul Hickley, 48, from Ireland,
two of the six presumed bosses, were among 80 foreigners arrested.
They have been charged with violating securities regulations and
the 78 others charged with working without a permit.
One of the four has been identified as John Kealay, an Irish national.
The six also face charges of fraud, the source said.
The 78 suspects were taken to the Southern Bangkok District Court
for arraignment yesterday. Their job was allegedly to persuade
would-be investors to buy non-existent shares.
The two others were detained at the Crime Suppression Division
pending further inquiries. Diplomats were present during the questioning.
Following the round-up on Thursday, the suspects were held at
the CSD auditorium under extra-tight security. Questioning proceeded
with difficulty because of language problems, said Pol Col Surapol
Thongprasert, chief of the transnational crime suppression centre,
who was in charge of the interrogation. Public prosecutors, moreover,
had told police to file charges against the suspects as individuals
rather than as a group, he said.
Patrol police ran back and forth on Thursday night between the
CSD and the suspects' places to search for passports and other
Pol Col Thawee Sodsong, of the CSD, said yesterday Mr Fisher and
Mr Hickley would face five years in jail if convicted.
To be continued…
List of those busted include:
01. Scott Prirembel, 29 (US)
02. Matthew Nutta, 28 (Can)
03. Steve Buchley, 37 (Brit)
04. Peter Frain, 37 (Brit)
05. Steven Sharpe, 42 (Can)
06. David Kelly, 26 (Ire)
07. Justin Beerling, 29 (Aust)
08. Malcolm Chambers, 43 (Scot)
09. Kevin Marsh, 31 (Brit)
10. Brian Gallant, 38 (Can)
11. Adrian Fobert Willis, 54 (Brit)
12. Peter Townshend, 33 (Brit)
13. Nathan Woods, 29 (Brit)
14. Herman Sudielson, 79 (US)
15. Richard Fowle, 33 (Brit)
16. Wayne Cardoza, 34 (Jam)
17. Paul Ryan, 32 (Ire)
18. Paul O?Leary, 31 (Ire)
19. Radolph Fitzgerald, 41 (Brit)
20. Sean Fisher, 32 (Brit)
21. Gregory Doel, 31 (Brit)
22. Shanvorn Assassi, 48 (Liberia)
23. Stephen Doherty, 30 (Ire)
24. Benjamin Davidson, 25 (Brit)
25. James Burn, 28 (Brit)
26. Scott McInnis, 26 (US)
27. Patricia Shaw, 31 (Aust)
28. David Karl Ryan, 28 (Aust)
29. Scott McGee, 31 (NZ)
30. Sian Gould, 26 (Brit)
31. Wayne Blandford, 45 (Aust)
32. John McGuile, 25 (Brit)
33. Steven Hooper, 28 (Brit) *
34. Daniel Smith, 29 (Brit)
35. Setald Jacobson, 71 (Can)
36. Ronald Silvertro, 55 (US)
37. Edward Jackman, 67 (US)
38. Claire Dickson, 22 (Brit)
39. Homce Bradshaw, 32 (Brit)
40. Keely Smith, 24 (Brit)
41. Brian Paterson, 49 (Aust)
42. Cecily Destate, 32 (P?pines)
43. Roger Charles, 31 (Brit)
44. Alyse Penny, 20 (Brit)
45. William Seymour, 42 (Aust)
46. Chris Cowle, 33 (Brit)
47. Andrew Low, 23 (Brit)
48. Norman Hewitt,58 (Brit)
49. Bruce James, 43 (Can)
50. Graham Hewetts, 21 (Brit)
51. Neil Delahaye, 26 (Ire)
52. Ronnie Kywe, 23, (Burma)
53. Foo Chee Wai, 29 (M?sia)
54. Marina Diaz, 28 (Spain)
55. Matthew Davis, 29 (Brit)
56. Mark Iorbert, 34 (Brit)
57. Robert Peter Mooney, 42 (Brit)
58. Robert Frandsen, 28 (Aust)
59. Jonathan La Ourgmaini,29 (US)
60. Lee Mun Yoke, 30 (S?pore)
61. Jeanifer Angeles, 23 (P?pines)
62. Michael Scales, 26 (Ire)
63. James Ryan, 20 (Brit)
64. Rodoto Oampo, 38 (P?pines)
65. Neville Veia, 46 (Aust)
66. Junel Jubutay, 31 (P?pines)
67. Peter Bradley, 40 (Aust)
68. Yuth Chareen, 26 (US)
69. Michael Lavin, 32 (Ire)
70. OT Boutisia, 58 (P?pines)
71. Sudha V, 24 (India)
72. Davin Darpal Bajaj, 37 (S?pore)
73. Tod Maknowy, 53 (US)
74. Mark Kanforian, 38 (US)
75. Steven Lokomiwitz, 40 (US)
76. Patrion O?Gertiny, 30 (Ire)
77. Christopher Scales, 23 (Ire)
78. Kenneth Kamebod, 40 (US)
79. Graig Zucker, 40 (US)
80. Seamus Ryan, 25 (Brit)
81. Jason Rich, 24 (Brit) - Jason Garrick Rich *
82. CT Bautista, 34 (P?pines)
83. Scott Fisher, 34 (Aust) - Scott Campbell Fisher *
84. Paul Hickey, 48 (Ire) - Paul Mary Hickey *
85. John Messey, 37 (Brit)
Source: Bangkok Metropolitan Forum bangkokmetro.com 07/26
Irishmen accused of running Thai share scam - Irish Examiner
THREE Irishmen were among seven foreigners who appeared in a Thai court
yesterday accused of being the masterminds of a international share scam
that burned scores of investors. Defence lawyer Prakob Udomchoti told
the court that his clients had not acted unlawfully.
"We've done things they said we did but all of them were legal both in the
United States and Australia. "All we have to prove in court is whether they
were legal also in Thailand," he said.
The Irishmen, three Britons and one Australian are accused of luring
foreigners to invest in non-existent stocks abroad. Bangkok prosecutors
say they are believed to have defrauded investors of more than £40,000.
If convicted, they face up to 10 years in prison.
The hearing was adjourned until next Wednesday.
According to the Thai Securities Exchange Commission, the suspects operated
unlicensed stock brokerage firms, employing about 100 people including
Britons and Irish as salespeople. They would call investors abroad and
convince them to invest their money in shares of non-existent or shaky
companies outside Thailand.
After a two year investigation, police raided the alleged fraudsters'
Bangkok offices - known as boiler room for the high-pressure sales tactics
employed there - and arrested 80 foreigners in July.
Seventy-three of them were deported while the seven alleged masterminds
They are: Irishmen Paul Mary Hickey, 48; John Martin Kealy, 36; and Ronan
Joseph Murray, 28; and Australian Scott Campbell Fisher, 34; Britons
Steven Hooper, 28; Jason Garrick Rich, 24; and Adrian Robert Wallis,
Prosecutors said they presented themselves as executives of various brokerage
firms called the Brinton Group, Benson Dupont Capital Management, Osiris
Asia Pacific, Strategic Alliance Corporation, Sigama Capital Management
and Dreyfus Capital. The investigation into their activities was conducted
by the Australian authorities and FBI following complaints by securities
regulators in Australia, New Zealand and Hong Kong.
Australian and US agents joined the Thai police in the raid.
Mr. John Martin Kealy,
Mr. Ronan Joseph Murray,
Mr. Paul Mary Hickey,
Mr. Scott Campbell Fisher,
Mr. Jason Garrick Rich,
Mr. Adrian Robert Wallis and
Mr. Steven Hooper
90 & S.
343 of the Penal
been divided into 2 charges: (1) S.90 - on court trial &
S.343 - PP decided not to pursue in court
As to the case of the Brinton Group a number of unverified stock
certificates were seized and regarded by the public prosecutor
as indispensable evidence, that should be confiscated upon conviction,
for the unauthorized securities business charge which is currently
on court trial.
In such case, if the Criminal Court finds the Brinton Group guilty
and agrees with the confiscation, under Section 36 of the Penal
Code, the aggrieved victims or the true owners of the confiscated
certificates may file their claims with the court within 1 year
after the case becomes final.
On the other hand, in case where the charge is dismissed or the
court does not pass the confiscation order, all the certificates
shall be returned to the entitled owners by the police under Section
85 of the Thai Criminal Procedure Code.
The Brinton Group victims are therefore advised to seek further
assistance in this area from local litigators or from the Thai
Cold-call seven escape Thai fraud charges
Richard Salmons - July 4 2002
Australian authorities have suffered a setback in their campaign
against cold-calling securities scams after key charges against
seven Westerners in Thailand were dropped this week.
The seven were employees of Brinton Group, an alleged "boiler
room" that was among the foreign-staffed Bangkok securities
firms Thai police swooped on in July last year.
On Tuesday, the Thai Securities and Exchange Commission said prosecutors
would drop fraud charges against the Brinton employees due to insufficient
The seven still face criminal proceedings on a count of undertaking
a securities business without a licence. However, the Australian
among them, Scott Campbell Fisher, said the authorities had missed
the target when they raided Brinton.
"The charges should have been directed against the other
operators, who were the ones running for the airport when we were
answering questions," he said in a telephone interview from
Bangkok. More than 80 foreigners were detained during the raid.
Most were deported for working without permits.
In a recent report, the Australian Securities and Investments
Commission estimated that international cold-calling stock scams
could count as the biggest ever category of financial fraud, having
cost Australians $400 million in losses so far.
The Thai SEC said in a statement that it had "used its every
effort" to gather evidence regarding the fraud charges, but
it could not control how they would be used by the public prosecutor;
nor could it explain why the prosecutor had dismissed the charges.
It said the charge of unlicensed dealing - carrying penalties
of two to four years' imprisonment and a 200,000 baht ($A8700)
fine - was continuing in court with the support of witnesses.
Mr Fisher said he and the other six, all British or Irish, would
fight the remaining charge.
"We took legal advice that there was no licence that could
be granted for our business," he said. "We registered
the company and everyone knew who we were."
Last July, ASIC praised the raids as an example of international
cooperation. Yesterday, an ASIC spokeswoman said the difficulty
of pursuing the prosecution highlighted the danger of sending money
A spokesman for the Australian Federal Police said that although
the force had no legal mandate to conduct operations overseas,
the Thai authorities would have told the AFP about the raids as
"They want someone to be present so, in the event there are
any Australians arrested, we can advise the embassy of that for
consular purposes," he said.
Mr Fisher said he saw three AFP officers at the Brinton office
on the day. "They were just as involved as anyone else," he
BIOSECURE GROUP CORP. (OTCBB: BSUR); AIRTECH INTERNATIONAL GROUP,
INC. (OTCBB: AIRG); NEWBRIDGE CAPITAL, INC. (Pink Sheets: NBRG);
NUOASIS RESORTS, INC. (OTCBB: NUOA); and OASIS RESORTS INTERNATIONAL,
INC. (Pink Sheets: OSRI)
Part IV – STILL GAMBLING AFTER ALL THESE YEARS
March 18, 2002
In recent months, NewBridge Capital, Inc. (Pink Sheets: NBRG) has been
intimately involved in the affairs of Yes Clothing Company, Inc., BioSecure
Corp. (OTCBB: BSUR), Airtech International Group, Inc. (OTCBB: AIRG),
and AirSecure LLC. Not so long ago, however, NewBridge was banking on
different partners, a pair of "casino and resort" companies
called NuOasis Resorts, Inc. (Pink Sheets: NUOA) and Oasis Resorts International,
Inc. (Pink Sheets: OSRI). Was that past merely a prelude to future financial
BioSecure and Airtech should not expect NewBridge to generate funds from
its interest in NuOasis. By now it's a familiar litany. NuOasis Resorts
Inc. is a small financially-challenged public company controlled by NewBridge.
Like NewBridge (and now Airtech) NuOasis gives its business address as
4695 MacArthur Court, Newport Beach, California.
NuOasis filed its last financial report in May 2001, a Form 10-Q for
the quarter ended March 31, 2001 – just like NewBridge. And also
like NewBridge, at last report the executive officers of NuOasis were
Fred G. Luke (CEO and director), Jon L. Lawver (Secretary and director),
and Leonard J. Roman (CFO and director).
That March 31, 2001 Form 10-Q said that NuOasis "invests in companies
that lease, manage and operate hotels, legalized gaming casinos, and
related operations." Not surprisingly, that includes companies that have
a relationship to Luke, Lawver, or both.
Like NewBridge, NuOasis has found ways to transform balance sheet items
from sow's ear to silk purse. For example, the Company sold Fantastic
Foods, Inc., its failing, inactive food distribution subsidiary, to Eurasia
Finance Development Corp., a private company controlled by Lawver. As
part of that deal, Eurasia agreed to assume full responsibility for the
liabilities of Fantastic Foods and to walk away from $628,000 that NuOasis
owed to its subsidiary. How did this affect the NuOasis financial statement?
By shedding the subsidiary, NuOasis was able to recognize a $602,000
gain. But what did shareholders really gain by the handoff to Lawver?
The NuOasis hotel and casino operations, to the extent they existed,
had been run through Oasis Resorts International, Inc. - another microcap
public company – controlled by members of the Luke-Laver group.
In this case, Luke was not an officer, but Lawver was secretary of Oasis
and Roman was its CFO. Lawver and Roman also were Oasis directors. Oasis
(Pink Sheets: OSRI) last traded on November 28, 2001.
Oasis (together with NuOasis) claimed plans to develop hotels and casinos
in Nevada and Tunisia, North Africa, under the "Oasis Resorts" and "Cleopatra's Palace" themes. Through a series of complicated agreements, including
some with partially owned overseas and offshore affiliates, Oasis became
involved in the construction of Le Palace Resort & Casino in Tunisia,
and the operation of a nearby casino. Investors reviewing the NuOasis
public filings might easily be frustrated in their efforts to decipher
those relationships or to understand just what the Company owned and
Until September 2000, NuOasis owned a majority of Oasis (through a NuOasis
subsidiary called NuOasis International, Inc.). In fact, at one time
the NuOasis shareholders controlled as much as 86% of Oasis. In a maneuver
that now seems typical of Luke-Lawver related companies, NuOasis acquired
much of its interest in Oasis through a convoluted series of stock swaps
and debt forgiveness. How complicated? Consider this convoluted disclosure
from the Oasis Form 10-K Annual Report for the year ended June 30, 2000:
The Company…entered into an exchange agreement with
NuOasis…a wholly-owned subsidiary of NuOasis Resorts,
Inc… to acquire NuOasis' 75% interest in Cleopatra Palace
Resorts and Casinos Ltd. ("CPRC"). CPRC had previously
acquired all of the equity interest owned by NuOasis in Cleopatra
Cap Gammarth, Limited ("CCGL") which intends to operate
the Cleopatra Cap Gammarth Casino (the "Cap Gammarth Casino"),
a right to re-acquire a 70% interest in Cleopatra Hammamet
Limited ("CHL"), which operates the casino Cleopatra
Hammamet Casino, and Cleopatra's World, Inc. ("CWI")
which operates the Le Palace Hotel & Resort at Cap Gammarth… All
of the properties are located in Tunisia. Cleopatra Palace
Ltd. ("CPL") is a predecessor company to CPRC, an
entity controlled by NuOasis, which previously held the interests
in the Cleopatra Hammamet Casino and the Cleopatra Cap Gammarth
That should be clear to investors, right? But wait, there's more.
Oasis goes on to explain how NuOasis gained control:
In connection with the acquisition of CPRC, the Company
issued 1,363,450 shares of common stock, common stock purchase
warrants representing the right to acquire 7,200,000 shares
at $30.00 per share, and issued promissory notes with an aggregate
face value of $180 million to NuOasis in exchange for certain
assets in NuOasis. At the time of the transaction, Oasis had
no ability to repay the notes, and therefore, the notes had
an estimated fair value substantially less than the face value
at the date of issuance. Based on the enterprise value of Oasis
at the date of [its reverse acquisition into a public shell]
of approximately $16.6 million, the Company valued the notes
at $7 million. On November 15, 1999, management of Oasis agreed
to extinguish the notes and cancel the 7,200,000 warrants for
the issuance of 8,111,240 shares of the Company's common stock …such
that the NuOasis shareholders control approximately 86% of
the Company's issued and outstanding common stock.
Putting it somewhat more simply, does that mean Oasis received
stock in NuOasis in exchange for an uncollectible promissory note – and
that NuOasis later exchanged that note for a majority of the Oasis
Efforts to establish the Tunisian operation ultimately seem to have failed.
As best we can determine, the Le Palace Resort was never completed and
Oasis was left with past-due trade payables of approximately $6 million
and litigation involving its obligation to make lease payments on the
Oasis had yet another opportunity to practice its stock swapping technique
in September 2001. On September 27, 2001, Oasis said that it had signed
an agreement with Brinton Group Inc. to exchange $15 million worth of
Oasis stock for $4 million in cash and approximately 1.1 million shares
of an Over the Counter Bulletin Board company called Virtual Gaming Technology,
Inc (OTCBB: VGAMD). At the time, Lawver indicated that Oasis expected
to close on the deal, with "partial funding of the $4 million equity
investment within the next few weeks."
The press release announcing this transaction was puzzling, particularly
since it did not indicate any previous relationship between Virtual Gaming
and Oasis. By September 2001, Oasis had ceased filing public reports,
but earlier filings suggested that the two companies were business partners
long before the Brinton Group deal came to light.
According to its Form 10-K for the year ended December 31, 2000, Oasis
first entered into a stock exchange agreement with Virtual Gaming in
December 1999. Then, again according to the Form 10-K, on August 31,
2000 Oasis issued "4,802,032 shares of its newly issued common stock
for 1,200,508 shares of [Virtual Gaming Technology]." In keeping with
the accounting practices of the other Luke-Lawver companies we have reviewed,
Oasis attributed a valuation to those Virtual Gaming Technology shares
based upon the purported value of the Oasis stock that had been issued
What was the true market value of the Virtual Gaming Technology stock?
Maybe that depends on which Virtual Gaming Technology we are talking
about – assuming the correct entity can be found. A public company
called Virtgame.Com Corp was called Virtual Gaming Technologies, Inc
(not Technology) until August 1999. But that name change came several
months before Oasis claims it entered into its first agreement with Virtual
Then there is a company called Virtual Gaming Enterprises, Inc., whose
trading symbol is VGAM. That would appear to be the Company in question – even
thought the trading symbol differs from VGAMD, the symbol mentioned in
the September 27, 2001 press release. At various times, Virtual Gaming
Enterprises has traded under the symbols VGAM, VGAMD and VGAME (the latter
coming into play when that Company jeopardized its OTC Bulletin Board
listing by not making timely public filings).
In fact, on September 18, 2001, the OTC Bulletin Board changed Virtual
Gaming Enterprise's symbol from VGAM to VGAME, indicating that the Company
would be removed from the OTC Bulletin Board unless it filed current
public reports within 30 days. Virtual Gaming seems to have missed that
deadline. The Company now trades on the Pink Sheets, under the symbol
VTGE, at about 5 cents a share. On September 27th Virtual Gaming Enterprises
stock was priced at 50 cents a share.
The September 27th press release failed to mention that Virtual Gaming
Enterprises had been threatened with delisting from the OTC Bulletin
Board. Nor did it disclose that the SEC was considering bringing an enforcement
proceeding against Virtual Gaming Enterprises. Then again, the press
release didn't bother to tell investors that Virtual Gaming Enterprises
had no business, no cash and no revenues.
Why would Oasis agree to exchange $15 million worth of its stock for
$4 million in cash and 1.1 million Virtual Gaming shares that were then
worth no more than $660,000 (based on the market September 27th market
price)? Was the transaction even possible? On September 27th Oasis stock
closed at 10 cents a share. That meant that Oasis would have had to issue
150 million shares to Virtual Gaming. That hardly seems likely. When
it filed its last Form 10-Q on July 3, 2001, Oasis was only authorized
to issue 75 million common shares.
Of course, it is also difficult to understand why Oasis did not seem
to know the correct name of the Company with which it was dealing.
Since Oasis no longer files financial reports it is impossible to determine
the fate of the latest Virtual Gaming transaction, but investors cannot
be terribly optimistic after considering the fate of the Brinton Group.
Brinton, as it turns out, was a boiler room operation run by an individual
named John Kealy, and operating out of offices in Bangkok, Thailand.
Like its counterparts in the United States, the Brinton boiler
room apparently conducted an illicit telemarketing operation, using
high-pressure tactics to sell so-called "hot stocks" that generally
turned out to be worthless. Brinton may have bilked investors out
of hundreds of millions of dollars.
Brinton and Kealy were reportedly involved with peddling shares of both
Oasis and Virtual Gaming. According to a November 19, 2001 article in "Time
Asia," the Brinton team prodded investors in Australia to invest in Oasis
by telling them that the Company was a global casino operation run by
the team that had set up a restaurant chain featuring Gary Coleman, star
of the 1980s TV show Diff'rent Strokes. They failed to mention, however,
that the only jewel in that chain was a failing restaurant in Denver,
“Time Asia" notes that Brinton also pushed shares of Virtual Gaming, an
Internet gambling firm run by one Virgil Williams, who was once tied to a boiler
room scam in San Diego, California.
On July 26, 2001, two months before Oasis announced the Virtual Gaming
Technology transaction, the Securities and Exchange Commission of Thailand
(in conjunction with the Federal Bureau of Investigation, U.S. Customs,
the Royal Thai Police, the Thailand Anti-Money Laundering Office, The
Thai Immigration Bureau and the Australian Federal Police,) raided Brinton's
offices. Apparently that was no easy task since Brinton allegedly kept
moving around to avoid detection.
The Thai authorities charged Brinton with running an unlicensed securities
firm and engaging in fraudulent activities, including the use of high-pressure
sales tactics. On September 20th, seven executives of the Brinton Group,
including Kealy, were charged with illegally conducting a securities
business without a license. That offense carries a maximum penalty of
five years in jail and a fine of 500,000 Thai baht (about $11,563 U.S.).
There has been no further word on the relationship between Brinton and
Oasis, or that $4 million that Oasis was slated to receive. We suspect
that Brinton and those seven executives may have been spending their
funds on lawyers.
What about the plan for Oasis to develop a casino resort in Nevada? According
to the public disclosures, Oasis owned a 20 acre interest in partially
developed land in Oasis, Nevada. That land housed a six pump truck stop,
convenience store, motel and café – all of which were out
NuOasis said it planned to use the property for a 500 room resort hotel
with a 30,000 square foot casino, entertainment complex and rodeo facilities.
The development of this facility, however, could present some practical
and logistical problems. Before they can use the proposed facility, customers
would first have to find Oasis, Nevada, and that will be no mean task.
We located Oasis in a listing of Nevada Ghost Towns. The town is not
near any major population center or airport. It has no industry or infrastructure,
and no significant human population. West Wendover, Nevada, the nearest
town with casinos and hotels, is over 35 miles away. But West Wendover
is on the Nevada-Utah border, so residents of Utah may be willing to
travel as far as West Wendover to gamble. But why would they ever find
it necessary to travel those extra miles to the Ghost Town of Oasis?
There is nothing to suggest that it would be practical to construct a
gambling complex in Oasis, where the work force would come from if it
ever were built, or who is likely to travel there. We understand that
prairie dogs make poor croupiers. We suspect they make unappealing customers
Like NewBridge, Oasis and NuOasis have stopped filing financial reports
with the SEC. At the time it filed its last Form 10-Q, for the March
2001 quarter, NuOasis owned less than 50% of Oasis, and was no longer
consolidating the Oasis financial results. As a result, NuOasis had no
revenues at the time.
Before they ceased to file any public reports, however, Oasis and NuOasis
each had at least one last mission to accomplish. On June 28, 2001, NuOasis
filed a Form S-8 registering 8 million shares of stock for certain, unnamed,
employees, officers, directors, advisors and consultants. Then, on July
12, 2001 Oasis filed a Form S-8 registering 2.5 million shares of stock
that would be issued to unnamed key employees, officers and consultants.
Neither Company has filed an amended Form S-8 identifying the recipients
of those shares.
So, we return to our original inquiry, and we are left with a series
of troubling questions. How can NewBridge help Airtech relieve its debt?
What is the current condition of NewBridge – which no longer files
financial reports? Is there any substance behind all of those inter-company
stock trades, assumed valuations, and deals with related parties under
Then there's this. Who will be running AirSecure, and how will that Company
be funded? Do TFG and its secret "founders" have any realistic chance
of participating in federal home security? Will all of these companies
just keep shifting assets and obligations among themselves? In other
words, to borrow a phrase from Gertrude Stein, is there any "there" there?
Lots of questions. Far too few answers.
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