30 Apr Promotion Secrets – A promoter’s attempt to bail out their most helpful market maker friend WDCO
On Monday evening we wrote up a report that we had all ready to release on Tuesday morning upon confirmation of the next Victory Mark pick found here. We had figured out that Victory Mark was going to announce Rancher Energy Corp (RNCH) as their next pick. Victory Mark was scheduled to release their pick at 9:30 am this morning. Instead 10 minutes before the open Victory Mark delayed their pick.
Last week we posted a report (found here) explaining a possible short squeeze situation with Lot78 Inc (LOTE) in which WDCO was allegedly stuck holding several short shares (possibly Naked short shares) that WDCO would not be able to settle causing a short squeeze.
An offside short position was allegedly created by WDCO. It as an offside position because the short position was bigger than the total amount of free trading stock held by retail investors (approximately 530,000 shares). On April 24, 2013, WDCO (Tony Kerrigone) tried to create a panic to cover that short position by flashing a huge artificial offer (Naked) and a large retail investor then allegedly took out 1.1mm shares from $2.00 - $1.50 helping keep the position from getting covered. As a result, at this point, the naked short seller (WDCO) had no way to cover the full position thus creating a short squeeze.
On April 25, 2013, somebody registered Lot78 Inc (LOTE) to trade on the Berlin exchange using mwb fairtrade as the market maker/broker. When this information was brought to the attention of LOTE they immediately drafted a press release saying they had nothing to do with the listing and they believed it was done to help somebody cover a short position.
On Monday, that short squeeze sent LOTE to a high of $11.65/share. This short squeeze allegedly put WDCO in a very bad financial situation.
WDCO is now allegedly on the verge of bankruptcy (or is at least in financial turmoil) because of the LOTE short squeeze. Word is that WDCO was still short some shares after the close on Monday. Since WDCO has now withdrawn as a market maker for LOTE this would constitute a major short selling violation.
The closest ally to WDCO (Anthony Kerrigone), Awesome Penny Stocks/Victory Mark, may have been making some attempts to try to help rescue WDCO. It is no big secret that WDCO is often the market maker that facilitates much of the market manipulation for the Awesome Penny Stock promotions. It is also no secret that Awesome Penny Stocks and Victory Mark are affiliated promoters. This gives the Awesome Penny Stock/Victory Mark crew reason to help rescue WDCO from its current financial situation. The first attempt may have been an article written by Ben Brinneman that was published on a website called thestreet.com found here. Prior to that article being written, a representative for Awesome Penny Stock was offering money to various publishers to write a negative article on LOTE in an attempt to drive the LOTE share price down to help WDCO cover its short position. It is possible that Mr. Brinneman accepted that offer. No compensation was disclosed by Brinneman so I cannot be sure. Back in February this same APS frontman also paid for a Forbes article written by Tedra DeSue promoting Awesome Penny Stock pick, Swingplane Ventures (SWVI). The piece was later taken down by Forbes, but a copy can be found here.
The second plan constructed by the Awesome Penny Stock / Victory Mark group to help their market maker friend was to allegedly float WDCO some shares in Rancher Energy Corp (RNCH) for really cheap so that WDCO (Tony Kerrigone) can sell those shares to try to get WDCO back to solvent after LOTE. The plan was allegedly for Victory Mark to help out by announcing RNCH as their next pick at 9:30 am on Tuesday, April 30, 2013.
On Friday RNCH saw a huge increase in volume jumping from almost nothing to 30,783,891 shares traded including 8 huge 3,750,000 share blocks being sold at $.016/share. It is very possible that those 30,000,000 shares were being transferred to WDCO to be sold during the Victory Mark promotion.
If WDCO can sell those shares at $.032/share that would be a $480,000 profit. At $.048/share that would be a $960,000 profit. After the big loss WDCO suffered from LOTE any significant profits will help.
Once upon a time, Rancher Energy Corp was a real oil & gas company with over $83 million in assets including oil & gas properties valued at over $73 million. Rancher Energy Corp was bringing in revenues of over $6 million annually.
Business suddenly took a turn for the worse in 2008 when a letter was received by RNCH from Sergei Stytsenko and other shareholders owning $1,800,000 in securities received in a private placement offering commenced in late 2006 alleging that the RNCH Directors and Executive Officers had acted negligently and contrary to their fiduciary duties. The letter threatened a lawsuit and demanded that the Directors and Executive Officers return all cash and stock received, cease payment of any cash or stock compensation for their services, resign their positions as Directors and Executive Officers and call a shareholders’ meeting to elect Andrei Stytsenko as the sole director of the Company.
In a another letter dated February 18, 2009 sent to each of the RNCH Directors, attorneys from the same group of persons alleged that securities laws were violated in that offering.
Accusations of securities fraud were not RNCH's only problem. Some large debts came due and RNCH was in no position to be able to repay their debts. On October 28, 2009, RNCH filed for a voluntary petition for relief in the United States Bankruptcy Court, District of Colorado under Chapter 11 of Title 11 of the U.S. Bankruptcy Code.
RNCH now had Claimants and Creditors after them.
A plan of reorganization was presented to the Bankruptcy courts on October 15, 2010. The plan would end up getting amended a couple of times.
On January 26, 2011, a Debtor-In-Possession Secured Financing agreement with Linc Energy Petroleum Inc was approved by the courts. Basically, Linc Energy Petroleum Inc paid off the RNCH creditors in exchange for all of the RNCH oil & gas assets.
Finally on September 10, 2012, the courts approved the Bankruptcy reorganization plan.
RNCH now has no more oil & gas assets, but they do plan on remaining in the oil & gas industry seeking out new oil & gas assets. RHCH has $2,126,000 in cash and $250,000 in other assets. Obviously with no more oil & gas properties, RNCH no longer has any revenues.
Last reported on February 1, 2013, RNCH had 119,862,791 shares outstanding, but the key is those 30,000,000 shares now allegedly held by WDCO acquired through the market at $.016/share.
Back on December 21, 2012, RNCH was used as a Stock Psycho promotion ($150,000 compensation). On that date the stock price rose from $.02/share at the open to $.049/share before closing at $.028/share.
Based on our information about the WDCO / Victory Mark situation, we expected RNCH to be a one day pump just to help WDCO profit off of those 30,000,000 shares. 10 minutes before the open today, at 9:20 a.m., Victory Mark delayed their pick. Now we don't know if Victory Mark will still go out on Rancher Energy Corp (RNCH) or go with another pick.
To add more fuel to the fire about the WDCO financial woes, the WDCO Denver branch (Anthony Kerrigone) either just signed out of all positions or exited all positions from all stocks. His branch held a prominent position in all the past Awesome Penny Stock picks and was in RNCH earlier today. He is now absent from all those positions. Could we really have another SEAB situation? SEAB is the market maker that went bankrupt from a short position in a stock that was ironically promoted by Awesome Penny Stocks back in 2010, Coastal Pacific Mining Corp (CPMCF). CPMCF is currently named in ASC litigation found here. Assuming the financial situation really is that bad, my understanding regarding LOTE is that WDCO would then be liable to CNS and would file for Chapter 11, all customers would be protected by SIPC but the brokers and any firm capital would be wiped out and the liability to CNS would be born on the firm partners etc.