SEC Sues two O.C. Lawyers involved in penny stock offering
The Securities and Exchange Commission sued three Orange County residents including two attorneys today for allegedly aiding a pump-and-dump scheme by a Georgia penny stock company. The SEC charged that Costa Mesa attorneys Albert J. Rasch Jr. and Kathleen R. Novinger, together with Sandra B. Masino of 144 Opinions Inc., issued fraudulent legal opinions. Mobile Ready Entertainment Corp. of Alpharetta, Georgia, used the opinions to sell 22 million shares of restricted stock to the public, the SEC alleged. Restricted stock, typically issued to insiders under the SECs Rule 144, is restricted from sale for a period of time. The SEC is demanding return of Rasch and Masinos ill-gotten gains as well as a court order against Rasch, Novinger and Masino barring them from participating in any penny-stock offering. The SEC sued Mobile Ready and its former top executives last July. That lawsuit is pending.
Source: The Orange County Register
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