(December 7 – 10:15 ET) – The U.S. Securities and Exchange Commission has settled yet another case of penny stock manipulation using Canadian brokerage accounts.

The SEC entered four settled orders imposing sanctions against William John Nordvik, John “Jack” Wright Jr., and Jon Williams for their actions involving the stock of Orlando Super Card Inc., a penny stock traded on the OTC Bulletin Board during the summer of 1997.

The SEC found that Nordvik, Wright and Williams violated securities laws. The commission ordered them to cease and desist, and barred Nordvik and Wright from participating in any offering of a penny stock. The commission also ordered Wright to pay a penalty of US$25,000 and Nordvik to pay a penalty of US$20,000, and ordered Nordvik to pay disgorgement and interest of US$29,532. The trio consented to the orders without admitting or denying the commission’s findings.

The SEC found that Nordvik gave numerous false and misleading documents to the initial market maker for Orlando stock. The documents created the impression that there were actual shareholders involved in the company. The trio also created a false and misleading business plan.

It also found that Wright and Williams, who had borrowed over 80% of the freely-trading Orlando shares, manipulated the stock through a series of matched trades in Canadian brokerage accounts of entities that they controlled. “The matched trades were part of a complicated ‘debit kiting’ scheme which Wright and Williams orchestrated in order to delay having to pay off mounting debts in the accounts.”

Between June 6, 1997 and August 7, 1997, Wright and Williams ordered at least 20 sets of matched trades of Orlando stock, pushing the stock from $1.25 to as high as $4.09.

In a separate proceeding, the SEC also entered an order barring Wright from associating with any broker or dealer, stemming from another case in which the SEC alleged he engaged in a fraudulent scheme to sell “stock repurchase agreements” by falsely portraying the risks of the investment and the use of investor funds.
-IE Staff