This blog was last updated on 1/25/08 and is maintained by Brad Rinehart. Click here to leave a comment. This article is about Microcap Stock Fraud.
Universal Express, Inc. (OTCBB: USXP) is a public company trading at around $ 0.0001 per share that was controlled and operated by Chairman and CEO, Richard A Altomare. To make a long story short the SEC filed suit against Universal, a company with no profitable operations and millions of dollars in debt, in 2004, but the company continued funding itself by illegally issuing billions of unregistered shares. During this time Altomare bilked the company out of hundreds of thousands of dollars in salary, bonuses, private jet charters and jewelry purchased with company funds.
On August 31, 2007, Federal District Judge Gerard E. Lynch of the Southern District of New York, appointed a Receiver, Jane W. Moscowitz, over the operations of Universal Express, Inc.
Judge Lynch has also warned former Universal Express CEO Richard Altomare that if he doesn't show whether he has assets to start paying a judgment, he had better bring his toothbrush to court next time.
The Threats Begin
An excerpt from Jane W. Moscowitz's account of her first day on the job as the court appointed receiver gives you an idea of what she was walking into:
I first visited the Boca Raton premises on Friday, September 7,2007. Because Mr. Altomare had told a local newspaper reporter that there would be a "corporate Waco" if anyone took his business from him, I engaged a former federal agent to accompany me to the premises. After we entered and determined that there was no danger, the ex-agent photographed the premises and interviewed some of the employees.Here is an excerpt from one of the emails Moscowitz received:
If you think for one second you can come barge into a company that is only trying to stay alive because of the ramped naked short selling and shut it down, think again. If you try to hide the truth behind this huge short position and how corrupt the SEC really is you are going to be hit with a … load of lawsuits, and if justice doesn’t prevail the good old American way, then I will make it my personal duty to enforce the justice and I along with others will come and beat your … to a bloody pulp . . .Moscowitz's reports to the court can be read in their entirety here: http://www.usxp.com/ The SEC complaint against Universal Express, Richard Altomare and others can be found here: http://sec.gov/litigation/complaints/comp18636.htm
Meet the USXP Trailer Park Touts
From a USXP discussion forum I found here .
The moderator of the forum, "Virginian" (an alias) and an assistant using another alias "Doogrof", apparently want to convince shareholders and potential investors that USXP is still a good trade and that the company is not yet cooked. One begins to wonder what they are smoking because the receiver has shut down company operations, vacated the office USXP was using and is in the process of selling off all of the assets of the company. If that's not enough they make every effort to convince people that the SEC might be held accountable some day for harassing what they call "a viable ongoing operation". An ongoing criminal operation would be a more accurate description. Check out this comical post from InvestorsHub.
"Virginian" and "Doogrof" troll their discussion forum 7 days a week looking for any post that might warrant a quick response or deletion (you'll come across a lot of posts that have been deleted). Both admit to owning millions of shares and "Virginian" seems quite proud of the fact that she has made over $100,000 trading this scam with buyers who had no clue what Altomare was up to, many probably drawn in by his misleading press releases. "Doogrof" makes it clear he's there to pump and dump his stock but wants you to believe he is a man of integrity because he's announced what price he will not sell under.
In this post "Virginian" calls Richard Altomare a "Pioneer" and goes on and on, as he usually does everyday, about the so-called naked short position (the same bullshit story Altomare used as the reason his stock price kept falling).
Here is what the judge had to say about Virginian's "Pioneer" hero:
As CEO of a publicly held company, Altomare occupied and continues to occupy a position of significant power, which he abused by repeatedly and brazenly committing fraud and flouting investor-protecting registration requirements. He has not only opposed the SEC’s request for summary judgment without pointing to a single piece of evidence sufficient to create a genuine issue as to any material fact of his liability, but he has also had the chutzpah on an overwhelming unfavorable record to seek summary judgment himself. The defendant’s professional position and apparent refusal to acknowledge the types of conduct that violate securities laws raise serious concerns that he will engage in such misconduct in the future. For these reasons, the Court, applying the multi-factor inquiry typically employed on such requests, Patel, 61 F.3d at 141, concludes that Altomare should be barred from serving as a company officer or director within the meaning of 15 U.S.C. § 78u(d)(2).After reading some of their daily babble one has to wonder just how involved Virginian and Doogrof are in this whole mess. Are they paid touts? Have they received stock at discount? In my opinion, they are just a couple of bagholders that were truly fooled into thinking Richard Altomare and his company were the real deal. No doubt they now find themselves in a mess either with the losses they've incurred or because they recommended this stock to everyone in their trailer park.
New 1-24-08: It looks like "Virginian" has either removed himself as moderator of the USXP board on InvestorsHub or was removed by the administrator. Hard to tell but it came a day after someone posted a link to this blog in that forum. It also looks like Virginian was busy deleting some of his posts before vacating the position.
Universal Express Discussion Forums
Raging Bull - over 500,000 messages have been posted here
InvestorsHub - currently a very active group. Over 14,000 posts
Silicon Investor - a user named "scion" is keeping everyone up to date on the court filings
Miscellaneous and less active USXP forums:
Yahoo! Investor Village Equity Group Board Reader
Watch Richard Altomare in action
Here you can see the King of Penny Stock Cons promoting a racing team he sponsored with illegal proceeds from the sale of stock that was not registered with the SEC. I am sure the mayor of Boca Raton regrets getting out of bed for this event (he gives a short speech in this video).
From our "Live Scammer Feed".
Barbara Altomare's Deposition
Another great piece of entertainment is the deposition conducted on Richard Altomare's wife, Barbara Altomare. Apparently Barbara knows that she was an employee at Universal Express but she's not sure what her exact position was. However, she does recall getting a $900,000 advance on her salary. THIS IS A MUST READ: http://www.proseresource.com/ma1.pdf
If you have information that could aid the SEC or the DOJ in their investigation into Universal Express, Inc., Richard Altomare or any of their cohorts please contact one of the following:
Robert M. Fusfeld
Attorney for Plaintiff
Securities and Exchange Commission, Central Regional Office
1801 California Street, Suite 1500
Denver, Colorado 80202
Robert B. Blackburn (RB 1545)
Local Counsel for Plaintiff
Securities and Exchange Commission, Northeast Regional Office
233 Broadway, 11th Floor
New York, NY 10279
If you believe a message has been intentionally posted in a discussion forum in violation of securities laws you should contact the Securities and Exchange Commission (SEC). The SEC's e-mail address for complaints is email@example.com. Their mailing address is: SEC Division of Enforcement Complaint Center Mail Stop 7-10 450 Fifth St., NW Washington, D.C. 20549 1-800-SEC-0330 (toll free) 202-942-9570
More to come soon... Brad Rinehart