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By: gr8hiker 11 Apr 2005, 08:15 PM EDT Msg. 192563 of 192710 Jump to msg. # Very aggressive response IMO. There is nothing conciliatory in that response other the closing statement asking that the motion be dismissed.According to the response , the SEC has clearly been guilty of an abuse of power with regard to CMKX.They disregarded past filings, they completely set their own timeframe for comformity by ignoring prescribed timetables for filing. They are not allowing for the fact that if past errors in advice were the reason for our mistakes, then that is certainly not grounds for administrative hearings according to SEC guidlines. There is NO fraud alledged or admitted. If this response does not motivate the SEC to solve the problem, I will be amazed . They now have all to lose and nothing to gain. This filing has IBM written all over it. It basically states, , if you want to make up the rules as you go along, then we will do the same and you will stand to lose way more then us. WE can and will either merge , or go private and IPO. But if you force the issue , we WILL take you down and rock the financial community in the process. 13 days to make this go away quietly, or risk , not only losing in court, buy even with a win , I can assure you, IBM will have the last word . Mentioning the NSS was a hint to the SEC that this will not be kept quiet much longer. That was [robably the most telling sentence in the filing. Its the first time its been publically alluded to by management.Notice they referenced it by connecting it to shareholders and not stating it as fact. That would have been disallowed. This way , its part of the public record for any further NSS legal action.
This was great. I can't wait for the next act. IBM and his lawfirm hard playing hardball.I bet the SEC has NEVER received a response from a pink or gray sheet company as aggressive as this in many a year , if ever.
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CMKM Diamonds, Inc, by its attorneys, Stoecklein Law Group, by Donald J. Stoecklein answers the allegations contained in the Order Instituting Administrative Proceeding and Notice of Hearing Pursuant to Section 12(j) of the Securities Exchange Act of 1934 (the “Act’), as follows:
RESPONDENTS STATEMENT OF FACTS
CMKM DIAMONDS INC. was originally incorporated in the State of Delaware on or about June 9, 1998 as Cyber Mark International Corp. (“Cyber”). On August 3, 1999 Cyber filed a 10-SB12G Registration Statement with the Securities and Exchange Commission to voluntarily become a registrant under Section 12(g) of the Act, which Registration Statement became effective October 4, 1999. At this time Cyber had
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6,104,300 shares of common stock issued and outstanding to approximately 41 stockholders.
Cyber’s common stock began trading on the Over-the-Counter Bulletin Board on February 15, 2000 under the trading symbol “CMKI”.
Cyber’s original auditor, Citran Cooperman & Company, LLP served as independent auditors for Cyber from the period ended December 3l, 1998 until May 18, 2001, at which time Cyber engaged the services of David E. Coffey, CPA. Mr. Coffey continued as the Registrant’s auditor until January 15, 2003.
On or about April 18, 2002, Cyber filed Articles of Conversion with the Secretary of State of the State of Nevada in order to change its corporate domicile, resulting in Cyber becoming a Nevada Corporation.
On or about November 25, 2002, Cyber entered into a Claims Purchase and Exploration Rights Agreement with Urban Casavant, individually and as Agent for Fort A LA Cone Diamond Fields, Inc., Buckshot Holdings, Ltd., Commando Holdings Ltd. 191919307 Saskatchewan Ltd, 101012190 Saskatchewan Ltd. 101027101 Saskatchewan Ltd. and Morgan Minerals, Inc. collectively “Sellers,” wherein Sellers conveyed to Cyber all rights and interest in the exclusive mineral exploration and mining rights on all or any portion of the Property claims defined within the Agreement, in exchange for 2,800,000,000 shares of Cyber’s restricted common stock with registration rights and $2,000,000. Upon effectiveness of the Agreement, Ian McIntyre Cyber’s then current officer and director, prior to his resignation appointed (i) Urban Casavant as Chairman of the Board, President and CEO, (ii) Carolyn Casavant as a member of the Board of Directors and as Vice President of Claims; and (iii) Wesley Casavant as
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Secretary/Treasurer. Urban Casavant, Carolyn Casavant, nor Wesley Casavant had U.S. public company reporting experience at the time of their appointments. As a result of the acquisition Agreements, on or about December 3,2002, Cyber’s Articles of Incorporation were amended to change its name to Casavant Mining Kimberlite International, Inc (“CMKM”).
On December 3, 2002, CMKM hired David DeSormeau, a 32 year veteran of financial accounting systems, to act as CMKM’s CFO and to work with the auditor to sure seamless integration with newly enacted Securities and Exchange Commission auditing practices for public companies. Approximately one month after Mr. DeSormeau’s engagement, CMKM’s auditor resigned. On or about January 15, 2003, at a meeting of a majority of stockholders. Mr. DeSormeau was appointed as a director and Treasurer. Due to CMKM’s inability to file its Form 10-KSB on or before March 31, 2003 for the period ended December 31, 2002, CMKM began trading on the “pink sheets” on May 23, 2003, whereon generally, 12g reporting is not a requirement.
On July 22, 2003, upon the advice of counsel, a Form 15 pursuant to Rule 12g-4(a)(1)(i) was filed as certification and notice of termination of registration under Section 12(j) of the Act, stating that at the time of filing the Form 15 CMXM had approximately 300 stockholders of record. A copy of the Form 15 is attached as Exhibit A.
On or about February 5.2004, CMKM’s Articles of Incorporation was amended to change its name to CMKM Diamonds Inc. (the “Company’s).
On June 4, 2004, the Company retained the services of Roger Glenn, Esq. from the New York law firm Edwards & Angel LLP to assist in preparing the required SEC reports in anticipation of requesting a market maker to resubmit the Company to the
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Over-the-Counter Bulletin Board for quotation. In a press release dated June 16, 2004, Mr. Glenn was quoted as stating “We have been retained by the Company to resolve the problems it has been facing, and we expect to devote significant efforts immediately toward that goal. The company has advised us that it is dedicated to complying fully with all requirements on it, and we are pleased to act as counsel to it on that basis” In Iuly of 2004, Mr. Casavant suffered a stroke which left him with no alternative but to rely upon the professionals he had retained to oversee the Company operations until he completed rehabilitation and was able to take control again.
The Company continued its efforts to bring its filings up to date by engaging Neil Levine, of the Firm of Bagell, Josephs & Company, LLC, as independent auditor.
During the 3rd or 4th quarter of 2004, the Enforcement Division launched an investigation in the “Matter of U.S. Canadian Minerals, Inc. LA-2937.” Under the umbrella of the LA-2937 investigation, the Enforcement Division caused the issuance of subpoenas, deposed and interrogated CMKM Diamonds’ consultants and management. inclusive of the Company’s new auditor, the Company’s financial consultant, and Edwards & Angel LLP. In addition, a subpoena was Issued directly to CMKM Diamonds, whereunder the Company supplied significant information to the Commission, including substantial information regarding the Company’s mining claims. Urban Casavant, the Company’s sole officer and director, as a result of a recent stroke and under the advice of counsel, asserted his 5th Amendment privilege.
In February of 2005, it was clear to Company management that they needed to be more aggressive if they were to complete the necessary reports for filing with the SEC and to enable a market maker to sponsor the Company to the Over-the-Counter Bulletin
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Board. Therefore, the Company appointed Mr. Robot Maheu to the Board of Directors in order to oversee the necessary regulatory requirements. Mr. Maheu. on behalf of the Company, immediately retained the service of Stoecklein Law Group on February 7, 2005 for the primary purpose of coordinating the preparation of all reports due under the Act for the respective missing periods. Upon its initial due diligence of the Company, Stoecklein Law Group realized that at the time of filing the initial Form 15. The Company had 698 stockholders of record and that the filing of a Form 15 was not available to the Company as of July of 2003.
On February 15. 2005, Stoecklein Law Group contacted the Division of Corporate Finance for a determination as to the most appropriate method of bringing the Company in compliance with Section 13(a). (See letter from Stoecklein Law Group to Division of Corporation Finance dated February 16, 2005, a copy of which is attached as Exhibit B). On February 17, 2005, Stoecklein Law Group advised the Company to file a Form 15/A which resulted in the Company being subject to the reporting requirements of Section 12(g) of the Act. (A copy of the Form 15/A, filed on February 17, 2005 is attached as Exhibit C). From the date of the filing of the Form 15 (July 22, 2003) until contact with the Securities and Exchange Commission, Division of Corporate Finance by Stoecklein Law Group on February 4, 2005, the Company was under the belief that it was not required to file periodic reports pursuant to Section 13(a) of the Exchange Act It should be further noted that even though the filing of the Form 15 was flawed on its face, there was no response from the Securities and Exchange Commission to the Company.
During March 2005 a financial consulting firm was retained to assist the Company in its financial statements and logistical coordination was commenced between
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management, the financial consulting firm, the audit firm, Stoecklein Law Group, and the transfer gent
On March 16, 2005, the Division of Enforcement filed the Order Instituting administrative Proceeding against the Company. The Company believes that as a result of the Enforcement Division investigation in LA-2937, the Enforcement Division caused the issuance of a temporary trading suspension on March 3, 2005 and the issuance of the Order Instituting Administrative Proceeding on March 16, 2005. While the actions by the Enforcement Division are designed to be remedial, they may in fact be causing a punitive effect on the Company’s stockholders by further perpetuating a growing “naked short position in the Company’s stock, as alleged by numerous stockholders.
WITH RESPECT TO SECTION I
1. Respondent CMKM Diamonds admits, upon information and belief, that the commission’s public official files disclose the matters set forth in paragraph 1, and refers to said files for their contents.
WITH RESPECT TO SECTION II
2. With respect to paragraph 1 of Section II, Respondent CMKM Diamonds admits that Respondent is a Nevada corporation based in Las Vegas, Nevada; admits that Respondent CMKM Diamonds’ common stock is registered under Section l2(g) of the Exchange Act; however, Respondent CMKM Diamonds alleges that it does not have and cannot obtain information sufficient to admit or deny any other allegations contained in such paragraph, and on that basis denies such allegations.
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3. With respect to paragraph 2 of Section a Respondent CMKM Diamonds admits, upon information and belief, that the Commission’s Section 13(a) of the Exchange Act rules disclose the matter set forth in paragraph 2 and refer to said files for their contents.
4. With respect to paragraph 3 of Section II, Respondent CMKM Diamonds admits the allegations contain in such paragraph.
5. With respect to paragraph 4 of Section II, Respondent CMKM Diamonds does not have and cannot obtain information sufficient to admit or deny the allegations contained in paragraph 4, except admits that a Form 15 was filed und the name of Casavant Mining Kimberlite International, Inc. on July 22, 2003.
6. With respect to paragraph 5 of Section II Respondent CMKM Diamonds admits the allegations contained in such paragraph.
7. With respect to paragraph 6 of Section II, Respondent CMKM Diamonds denies the allegations contained in such paragraph.
WITH RESPECT TO SECTION III
8. With respect to Section III, Respondent CMKM Diamonds does not have and cannot obtain information sufficient to admit or deny the statements contained in said
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paragraph, however, denies that a public administrative proceeding instituted pursuant to Section 12(j) of the Exchange Act is appropriate for the protection of investors.
WITH RESPECT TO SECTION IV
9. With respect to Section IV, Respondent CMKM Diamonds admits upon information and belief that the Commission’s public official files disclose the matters set forth in said Section, and refers to said files for their content, and the Orders stated therein.
This Respondent, CMXM Diamonds denies each and every allegation of the Division of Enforcement not herein admitted, qualified, or denied.
FIRST AFFIRMATIVE DEFENSE
Respondent CMXM Diamonds alleges and believes that the Commission lacks authority to conduct the proceedings herein.
SECOND AFFIRMATIVE DEFENSE
The allegations of the Office of the Division of Enforcement fail to state a claim upon which the Commission can rend sanctions as requested in Section III B of the Order Instituting Administrative Proceeding.
THIRD AFFIRMATIVE DEFENSE
Allegations of the Office of the Division of Enforcement are barred by laches.
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FOURTH AFFIRMATIVE DEFENSE
In light of the allegations contained in Section II, paragraph 1 and paragraph 2, of the Division of Enforcement, the allegations that the Commission deems it necessary and appropriate for the protection of investors that a public a administrative proceeding be instituted against Respondent CMKM Diamonds, Inc. to suspend for a period not exceeding twelve months, or revoke the registration of each class of CMKM Diamonds’ securities is inconsistent with Section 13(a) of the Exchange Act and Rules 13a-l and 13a-13 thereunder.
FIFTH AFFIRMATIVE DEFENSE
In light of the Statement of Facts as enunciated by Respondent. Respondent deems the sanctions as proposed by the Division of Enforcement to be punitive remedies against and indispensable parties who have not had an opportunity for appearance herein, and on that basis it would be unconstitutional for the Commission to take any disciplinary action based thereon.
SIXTH AFFIRMATIVE DEFENSE
In light of the Statement at Facts as enunciated by Respondent, Respondent deems the sanctions as proposed by the Division of Enforcement to be punitive in nature against the Respondent CMXM Diamonds for the following reasons:
a. Respondent, pursuant to Rule 12g-4(b), had 60 days after the filing of the amended Form 15 on February 17, 2005, which would be on or about April 17,
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2005, to file its reports. Respondent’s actions lack egregiousness, in that its obligations did not occur until after the filing by the Commission of the Order at hand.
b. Respondent’s actions were isolated and not recurrent in that once the respondent learned of the requirement for filing the amended Form 15 on February 13, 2005, the Respondent immediately commenced setting into motion the preparation of financial statements, setting meetings with the Company’s auditors, and counsel for the Company in anticipation of the preparation of the periodic reports.
c. Respondent lacked the scienter required for willful misconduct, in that Respondent relied on the advice of counsel indicating that reports were required after the filing of the Form 15 on July 22, 2003.
d. Respondent has demonstrated the sincerity of Respondent’s assurances against future violations by nominating an additional board member for purposes of conducting an internal investigation of the Respondent’s corporate matters, setting up procedural internal controls, and setting into motion the coordination of bringing current the outstanding periodic reports. As a result, significant dollars have been spent by Respondent to assure its corporate compliance with the reporting requirements of the Act.
e. Respondent recognizes that it was of the mistaken belief that Respondent was not required to file periodic reports as of July 22, 2003, and has recognized the wrongful nature of its failure, and has taken corrective action.
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f. Respondent has established significant reporting controls to provide assurances that Respondent will not either mistakenly, or intentionally violate the reporting requirements, once such reports are brought up to date and current.
g. Respondent’s financial position is such that Respondent is able to incur the coats associated with its reporting obligation.
h. Respondent has retained professionals specializing in federal securities and public company reporting requirements and is sincere in its desire to continue with its reporting requirements under the Act.
SEVENTH AFFIRMATIVE DEFENSE
That the relief sought in Section II B is vague and ambiguous.
EIGHTH AFFIRMATIVE DEFENSE
In Section II, paragraph 3, the Division of Enforcement alleges that CMXM Diamond has not filed an Annual Report on either Form 10-K or Form l0-KSB since May 9, 2002, or quarterly reports on either Form I0-Q or Form I O-QSB since November 18, 200Z Respondents first missed filing of a periodic report was on March 31, 2003, when the Respondent’s did not file its Form 10-KSB for the period ending December 31, 2002. In Section II, paragraph 4, the Division of Enforcement alleges that CMKM Diamonds filed a Form 15 on or about July 22, 2003. Respondent was under the belief mistaken or otherwise, that its duties as an issuer were suspended immediately upon filing its Form 15 certification pursuant to 12g-4(b). Therefore, Respondents failure to comply, if at all, with Section 13(a) was not known until February 15, 2005, when counsel for the
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Respondent discovered the error, and filed the amended Form 15, thereby subjecting the Respondent to its reporting obligations.
Respondent alleges as an Fight’ Affirmative Defense that pursuant to 12g-4(b), Respondent was entitled to a 60 day period, expiring on April 17, 2005, following the filing of the Form 15/A to bring its missing reports current Therefore, any proceeding to revoke or suspend the registration of the Respondents securities is premature.
NINTH AFFIRMATIVE DEFENSE
In light of the allegations contained in Section II, paragraph 1 and paragraph 2, by the Division of Enforcement, the allegations that the Commission deems it necessary and appropriate for the protection of investors that a public administrative proceeding be instituted against Respondent CMKM Diamonds, Inc. to suspend for a period not exceeding twelve months, or revoke the registration of each class of CMKM Diamonds’ securities is inconsistent with the allegations contained in such paragraphs. The purpose of the sanction imposed is intended to be remedial in nature, not to punish the Respondent or its stockholders but to protect the public, to achieve voluntary compliance with the law and to deter the respondent from future violations.
As an affirmative defense to the proposed sanctions. Respondent proposes that Respondent (i) has no prior record of non-compliance with SEC regulations; (ii) has voluntarily taken corrective action by contacting the Commission itself prior to the issuance of an Order Instituting Administrative Proceeding (iii) has demonstrated to the Commission a willingness to take corrective action; (iv) has cooperated with the commission; (v) the alleged violations are not fraudulent in nature; (vi) there was no
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intent by Respondent to not comply with Section 13(a) of the Exchange Act and Rules 13a-1 and 13a-13 thereunder; (vii) Respondent’s management was inexperienced in operating a public company (viii) respondent’s sole officer and director suffered serious health issues during a portion of the time period referenced; (ix) Respondent relied upon the professional advice of prior counsel in filing the original Form 15; and (x) Respondent brought to the attention of the Commission, the very issue for which tie Commission has instituted the Administrative Hearing.
WHEREFORE, having fully answered. Respondent, CMKM Diamonds Inc. pray:
1. That the relief described in Section III B of the Order Instituting Administrative Proceeding be denied and the proceedings herein dismissed; and
2. That Respondent CMKM Diamonds be given all and such other relief as the Commissioner may deem just and proper.
Hi we are CMKX, sorry we are bunglers.. we didn't know printing 779 billion shares into the market was a bad thing! Sorry I Urban had a stroke see and while I was out in la la land and occasionally returning back to earth to go drag racing, that evil cheat bungler Roger Glen hoodwinked us all! I swear from the basement of my 2 million dollar homes I will fix that roger glen and make us all rich! Oh yeah and for answers to where the official CMKX headquarters are please go to our punchingbag.. er I mean PR guy Andy Hill for directions... opps I'm OUTA HERE!!! KACHNG KACHING!!!! errrrrrrrrrrrrrrrrrrrrr Vrooooooooooooooooooooooooooom,
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Gender: Posts: 5416 Re: Thanks Urban ! « Reply #6 on: Today at 11:49pm »
IF UC wanted to get us revoked, there was a VERY SIMPLE way to do that. No answer, revocation would be virtually automatic. There IS a fight still going on, folks. UC took the 5th amendment privelege to not incriminate himself in answering some of the questions posed by the SEC in their investigation of USCA. IF he wanted to whack his shareholders, why would he file this answer and ADMIT PUBLICLY that he invoked the 5th? How embarrassing could that be for UC? Think about it! This battle, IMO, was perceived. He intended to address it when it came.
Let me give you a little analogy. You have a car wreck. The insurance adjuster calls you up, and you were not at fault, but the adjuster's job is to get you to in some way accept any, tiny, bit of responsibility for the wreck. That is cmparative responsibity. IF you are 10$ at falult, in some, but not all, states. Instead of paying your $1000 hospital bill, they just have to pay $900. The adjuster has your recorded statement. Next, you go to lawsuit. The attorney for the defense takes your deposition. NOW, they can beat you up with what you told the adjuster, if your story is not identical, and you have just became a LIAR. Then, if you go to trial, they have your recorded statement, the deposition testimony, and if you falter and do not give an identical story at trial, you will get killed with that statement and deposition and be made out to be a LIAR. Why give them that many shots at you? Can you tell an identical story last year, a year later and then again a year from that? Any imperfections in what you tell will come back to haunt you. UC did the right thing! Do NOT give something that will be laid out in concrete form. Tell your story at the right time, this hearing. It's only smart business, IMO. Tell your story once! Don't tell it several times on the record. How can any of us tell the same story 100% exact each and every time without it having some variances? You can't do it in a way that a good attorney will no kick your ass, if the oposing attorney is worth his weight in manure. Think about it. It's being handled in the right way. We knew it was coming, and we are addressing it. I think we're going to win.
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first, its all i didn't do it, i wasn't there, i didn't know any better or its not my fault. (reminds me of Bart Simpson) for legel to be able to post 2 differant responces that side with cmkx is unbelievable. that fact that those 2 were out of a thousand or more feeling the same way is just plain mind boggling. what we haven't seen is a detailed report on the charges, just responces to each section. at least when Mario of MLON fame got caught he fessed up. he had the ba**s to come clean. UC starts out with a 5 yr olds babbling to getting caught with its hand in the cookie jar.
-------------------- "keep your stick on the ice & your cup firmly in place" Posts: 3651 | From: Algonac, MI. 48001 | Registered: Jun 2004
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Gender: Posts: 6517 The CMKX response was right on target. « Thread started on: Today at 02:49am »
-------------------------------------------------------------------------------- I had posted above in the pinned thread that I was optimistic about the hearing. I didn’t want to respond my thoughts fully until I had done my due diligence and understood everything more clearly.
Most 12(j) decisions are guided by precedence. The standard used here is Steadman v. SEC, 603 F.2d 1126, 1140 (5th Cir. 1979)
Under Steadman, the following issues are considered.
(1) the egregiousness of the respondent's actions;
(2) the isolated or recurrent nature of the infraction;
(3) the degree of scienter involved;
(scienter n. Latin for "having knowledge." In criminal law, it refers to knowledge by a defendant that his/her acts were illegal or his/her statements were lies and thus fraudulent.)
(4) the sincerity of the respondent's assurances against future violations;
(5) the respondent's recognition of the wrongful nature of its conduct; and
(6) the likelihood of future violations.
No one factor is controlling.
I have broken down the above by inserting the defenses presented in the CMKM response below.
(1) the egregiousness of the respondent's actions;
Respondent, pursuant to Rule 12g-4(b), had 60 days after the filing of the amended Form 15 on February 17, 2005, which would be on or about April 17, 2005, to file its reports. Respondent’s actions lack egregiousness, in that its obligations did not occur until after the filing by the Commission of the Order at hand.
(2) the isolated or recurrent nature of the infraction;
Respondent’s actions were isolated and not recurrent in that once the respondent learned of the requirement for filing the amended Form 15 on February 13, 2005, the Respondent immediately commenced setting into motion the preparation of financial statements, setting meetings with the Company’s auditors, and counsel for the Company in anticipation of the preparation of the periodic reports.
(3) the degree of scienter involved;
Respondent lacked the scienter required for willful misconduct, in that Respondent relied on the advice of counsel indicating that no reports were required after the filing of the Form 15 on July 22, 2003.
(4) the sincerity of the respondent's assurances against future violations;
Respondent has demonstrated the sincerity of Respondent’s assurances against future violations by nominating an additional board member for purposes of conducting an internal investigation of the Respondent’s corporate matters, setting up procedural internal controls, and setting into motion the coordination of bringing current the outstanding periodic reports. As a result, significant dollars have been spent by Respondent to assure its corporate compliance with the reporting requirements of the Act.
(5) the respondent's recognition of the wrongful nature of its conduct; and
Respondent recognizes that it was of the mistaken belief that Respondent was not required to file periodic reports as of July 22, 2003, and has recognized the wrongful nature of its failure, and has taken corrective action.
(6) the likelihood of future violations.
f. Respondent has established significant reporting controls to provide assurances that Respondent will not either mistakenly, or intentionally violate the reporting requirements, once such reports are brought up to date and current. g. Respondent’s financial position is such that Respondent is able to incur the coats associated with its reporting obligation. h. Respondent has retained professionals specializing in federal securities and public company reporting requirements and is sincere in its desire to continue with its reporting requirements under the Act.
(I just hope it is Willy’ed down enough for the SEC to understand it.)
I would also like to say that I believe they included more than enough defenses than that were required ensuring more can be involved and brought to light.
The Risk/Reward ratio has been thrown off balance out of favor of the SEC. I think looking at this... the SECs best choice in the matter is to either dismiss the hearing, or be very lenient and perhaps come up with a schedule for CMKX to follow as opposed to pressing the action.
Everyone wants to avoid headaches especially when they acted inappropriately to cause their own headache.
Stoecklein did a great job IMO.
« Last Edit: Today at 03:19am by georgeburns » Logged
-------------------------------------------------------------------------------- Disclaimer: Items above may or may not be true. Do not buy or sell stock based on what I write.
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Posts: 258 CIM Will BUYOUT CMKX before the Hearing (OPINION) « Thread started on: Today at 06:58am »
-------------------------------------------------------------------------------- the following are just my initial thoughts on what may take place before the hearing and the SEC can do NOTHING about it.
i have a feeling that we are going to be just fine with this stock, we have CIM.
CIM has been buying the heck out of CMKX via private money, to buy all the real share of cmkx... what better way to buy a stock than privately thru a private company CMKX, possibly puts all the shares on the market so it appears to be diluted... thus it can be NS'ed to death (well near death).
The GOT CMKX? was getting everyone in the game for 50k or whatever the number represents gets the retail buyers buying up as much cmkx as "anyone" (nsing) is willing to sell us... even though NS'ing existing in cmkx prior to that advertising.
See the SEC DOES NOT have to give the OKAY for CIM to buy out CMKX for CIM is private -- that's the beauty of it all.
CIM can buyout cmkx w/ NOT hardly much money at all... since most of the shares that we hold are NS'ed than CIM can get a company to just broker the deal to move ASSETS from PUBLIC company CMKX to private company CIM.
The NS'ers via settlement and or forcing the hand have to pay us the shareholders that are holding the NS'ed shares.
We get cash for our CMKX shares and get to stay in the game w/ CIM and possibly get to buy more shares of CIM when it is IPO'd.
The SEC can do NOTHING about it.
The 20b still not issued in CIM will be used for either IPO and/or to take care of the big boys that helped put it together.... remember nevada minerals they wanted the DIVYS and sold back CMKX for what $2m+, they wanted CIM the most.
The hearing could be moved back a bit, but i don't think so, the sec is trying to stop it all, but they can't. The financing needed, which is minimal would just be necessary to take care of the few shares out there that are NOT NS'ed, for the NS's are going to be most of the financing that will take care of most of us.
The SEC knows and is trying to move so fast against CMKX (that's why the hearing is on April 25 and we were not supposed to even get in trouble until after April 17, 2005... for CMKX had 60 days. So the SEC is trying to railroad CMKX. Cmkx is acting quickly to get it done. CMKX knew that the SEC would do it but probably thought they had more time (ie. the 60 days from Feb 17, 2005). So time is what is important and CMKX is moving to get it all done before April 25, 2005
All in my opinion of course
GOT CIM?
These are just my initial thoughts, so please find holes.
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Associated Press Charges Filed Against 15 NYSE Specialists Tuesday April 12, 11:40 am ET Justice Department, SEC File Charges Against 15 NYSE Specialists for Improper Trading
NEW YORK (AP) -- Fifteen specialists who managed trades on the floor of the New York Stock Exchange were indicted Tuesday, charged with fraudulent and improper trading practices by the Justice Department. The Securities and Exchange Commission filed civil charges against 20 specialists and the NYSE as well. ADVERTISEMENT
Federal officials said that between 1999 and mid-2003, specialists at five firms put their firms' orders ahead of customers' orders, causing those customers to get inferior prices.
The SEC also charged the NYSE with failing to enforce its own rules, charges that the NYSE has already settled. The NYSE will be censured and must spend $20 million on regulatory audits every two years through 2011.
The criminal probe of the NYSE traders by federal prosecutors grew out of a civil case against specialist firms that employ the traders.
Specialists run the open-outcry auctions on the floor of the NYSE and keep trading orderly. They match buy and sell orders for customers of the stocks they oversee and use their firm's money to buy shares when nobody else wants to buy and to sell shares from their own inventory when nobody else wants to sell.
In addition to the federal indictment and civil charges, the NYSE's regulatory enforcement arm announced charges against 17 former specialists in connection with the case.
Last year, NYSE specialist firms paid a total of $247 million to settle the same allegations brought by the SEC.
The firms' profits come from fees on each transaction as well as their own stock trading. Critics of the specialist system claim this is an inherent conflict of interest, while the NYSE has noted that the specialist firms gained $155 million in illegal profits over five years, a time when the exchange handled $50 trillion in trades.
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posted
Looks like Urban will have lots of company in his cell
-------------------- Be Careful Of The Toes We Step On Today, They Could Be Attached To The Butt We Have To Kiss Tomorrow Posts: 4727 | From: Elk Grove ( Sacramento )CA USA | Registered: Jun 2004
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posted April 11, 2005 19:42 -------------------------------------------------------------------------------- Sounds like Urban is guilty as hell, oh please SEC take pity on him he did have a stroke and left the company in the hands of his lawyers. What a "crock", he knew damm well what was happening, he milked his shareholders and he should get jail time
Urban is blaming everyone else for the billions and billions and billions of shares, who did he think was paying for his rich life style. Oh sorry I forgot he was ignorant to what was going on." Bull Crap"
I hope he gets what he deserves= Jail Time.
Just brought some of the truth over to your new thread
-------------------- Be Careful Of The Toes We Step On Today, They Could Be Attached To The Butt We Have To Kiss Tomorrow Posts: 4727 | From: Elk Grove ( Sacramento )CA USA | Registered: Jun 2004
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2) the isolated or recurrent nature of the infraction;
Respondent’s actions were isolated and not recurrent in that once the respondent learned of the requirement for filing the amended Form 15 on February 13, 2005, the Respondent immediately commenced setting into motion the preparation of financial statements, setting meetings with the Company’s auditors, and counsel for the Company in anticipation of the preparation of the periodic reports.
(3) the degree of scienter involved;
Respondent lacked the scienter required for willful misconduct, in that Respondent relied on the advice of counsel indicating that no reports were required after the filing of the Form 15 on July 22, 2003. ==============================================
these 2 are the best examples of bull**it i'f seen in a while..these lawyers are good unlike the last idiot they got, roger glen. if these lawyers think that the SEC will buy that a company with a 7 billion o/s when it stopped reporting & with almost 400 shareholders at that point, didn't know that they went over 500 shareholders after issuing another 772 billion shares into the market then the entire market is doomed. it took over 2 yrs to figure that 1 out?? i have a 16 month old grandbaby that can't talk yet that could figure that out. this was a deliberate act only brought up by cmkx because of cmkx's relationship with USCA & the SEC investigation they are under going. if as these lawyers are tring to make it seem cmkx had wanted to bring this up it would have happened when the divy's were handed out because the t/a had to send shares to more then 500 street accounts. why should the SEC give them time to file? it couldn't be more plain that they had no intention to file.
-------------------- "keep your stick on the ice & your cup firmly in place" Posts: 3651 | From: Algonac, MI. 48001 | Registered: Jun 2004
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My god legal...please stop posting. To actually believe someone took the 5th amendment because they were trying to help someone other than themselves is not only dumb but irresponsible. All these posts of yours take up valuable space on the board pushing other "plays" from being read. Am I a basher...HELL YES. Someone give me back my $2k *ahem* invested in the POS and I will become the biggest pumper alive. You could even take me over to the CT site and I would pump so much there you'd think I was a $15 hand pump bought from Canadian Tire.
Posts: 204 | Registered: Jan 2005
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quote:Originally posted by mydogsky: My god legal...please stop posting. To actually believe someone took the 5th amendment because they were trying to help someone other than themselves is not only dumb but irresponsible. All these posts of yours take up valuable space on the board pushing other "plays" from being read. Am I a basher...HELL YES. Someone give me back my $2k *ahem* invested in the POS and I will become the biggest pumper alive. You could even take me over to the CT site and I would pump so much there you'd think I was a $15 hand pump bought from Canadian Tire.
I agree with you, but not to worry. When I sent my letter to the SEC with my complaints I needed some addition information so I sent along copies of Legal's post so that I could show the useless pumping on this thread. Well they may not give it much attention but at least they will see the crap that is being put before the shareholders
Thanks for the help Legal
-------------------- Be Careful Of The Toes We Step On Today, They Could Be Attached To The Butt We Have To Kiss Tomorrow Posts: 4727 | From: Elk Grove ( Sacramento )CA USA | Registered: Jun 2004
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The CMKX Community Board General General Discussion (Moderators: Dr911, Andy Carter, Rush, NinjaSHUx, ChuckWheat, golden1101) ***MORE ÇMKX ÇONNECTIONS!*** « Previous Topic | Next Topic » Pages: 1 2
quote:Originally posted by legaleagle: I guess that was meant to intimidate me Doc. Good Luck.
Not at all, just thought that your post were interesting to say the least, falls in line with the philosophy of CMKX and pumping false statements. Not intended to intimidate just intended to let SEC see what kind of information is out there and who is trying to promote a useless stock.
I can't stop a person with no consideration for fellow human beings from posting and trying to lure the unsuspecting into the CMKX trap. Have at it
-------------------- Be Careful Of The Toes We Step On Today, They Could Be Attached To The Butt We Have To Kiss Tomorrow Posts: 4727 | From: Elk Grove ( Sacramento )CA USA | Registered: Jun 2004
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Oh sorry I am not feeling good today, can't be responsible for what I say. Sounds like Urban, what a crock!!!! Urban is probably not feeling great these days because of his greed and the fear that the SEC is breathing down his neck. He will feel better when he gets settled in his new cell
-------------------- Be Careful Of The Toes We Step On Today, They Could Be Attached To The Butt We Have To Kiss Tomorrow Posts: 4727 | From: Elk Grove ( Sacramento )CA USA | Registered: Jun 2004
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Until I see filing stating otherwise and the SEC hearing, all we have to go on is that this is a scam. 703 billion o/s. Legal, If they file by the 17th which shows that this is a legit company and the 25th SEC hearing then pump away and get new investors. But right now it looks like a scam, smells like and scam. So to people it looks like you are trying to scam new investors in to lose there money. Trying to convince them that there is no problems here and they will be rich if they invest.
As I said. After the 25th if CMKX proves us wrong then I will help you pump this. But until then, I feel anyone trying to convince others to buy this is low.
-------------------- Invest with your brain not with your heart. Posts: 4405 | From: Bristol, Tn, USA | Registered: Aug 2004
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quote:Originally posted by Ric: Until I see filing stating otherwise and the SEC hearing, all we have to go on is that this is a scam. 703 billion o/s. Legal, If they file by the 17th which shows that this is a legit company and the 25th SEC hearing then pump away and get new investors. But right now it looks like a scam, smells like and scam. So to people it looks like you are trying to scam new investors in to lose there money. Trying to convince them that there is no problems here and they will be rich if they invest.
As I said. After the 25th if CMKX proves us wrong then I will help you pump this. But until then, I feel anyone trying to convince others to buy this is low.
Ric I agree with you 100% on your take of this current situation with CMKX. BUYER BEWARE, but if all pans out after the 25th I to will promote the stock. But until then I could not live with myself promoting what appears to be a scam
-------------------- Be Careful Of The Toes We Step On Today, They Could Be Attached To The Butt We Have To Kiss Tomorrow Posts: 4727 | From: Elk Grove ( Sacramento )CA USA | Registered: Jun 2004
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legel...there are so many in bed together on this a holiday inn couldn't hold them according to the cult. & maybe some of it is true. but cmkx by itself, the shares of cmkx are worthless & will always be. UC has screwed up this thing so bad its hopeless. maybe he did rely on morons for direction & if so it goes a lot deeper then just a few ppl. the t/a had to be in on it, the david whatever hired in 2003 to keep the books, roger glen, the lawyers before him, UC himself. all of these groups & ppl had to just plain stick it to the shareholders. & dont start about its all ok because of a massive naked short. you really think the mm's are so foolish as to leave their flank open to attack over a small unproven pink sheet stock? with an average yr to date pps of about .0002?? as for rolling it into CIM , they already have an o/s that kills any real value. forget the 20 billion not added to the divy. 20 billion by itself ends all hope
-------------------- "keep your stick on the ice & your cup firmly in place" Posts: 3651 | From: Algonac, MI. 48001 | Registered: Jun 2004
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quote:Originally posted by legaleagle: I guess that was meant to intimidate me Doc. Good Luck.
Not at all, just thought that your post were interesting to say the least, falls in line with the philosophy of CMKX and pumping false statements. Not intended to intimidate just intended to let SEC see what kind of information is out there and who is trying to promote a useless stock.
I can't stop a person with no consideration for fellow human beings from posting and trying to lure the unsuspecting into the CMKX trap. Have at it
Actually I think it is a good idea. But let's keep it as balanced as this board. I could gather up a few basher posts and submit them as well. However, I can't stop a person with no consideration for fellow human beings from posting and trying to support the crooked MM's and DTCC in covering thier little naked @sses.
Posts: 2375 | Registered: Nov 2004
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Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) April 11, 2005
CMKM DIAMONDS, INC.
(Exact name of registrant as specified in its charter)
Nevada 000-26919 90-0070390
(State of incorporation) (Commission File Number) (I.R.S. Employer Identification No.)
5375 Procyon St., Suite 101
Las Vegas, Nevada
89118
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including are code: (877) 752-3755
Casavant Mining Kimberlite International, Inc.
(Former name)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
On April 11, 2005, the Company filed its answers to the allegations contained in the SEC's Order Instituting Administrative Proceeding and Notice of Hearing Pursuant to Section 12(j) of the Securities Exchange Act of 1934. A copy of the Company's answer is attached hereto as exhibit 99-1.
The information in 7.01 of this Form 8-K shall not be deemed "filed" for purposes of Section 18 of the Securities Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.
A copy of the SEC's order instituting the administrative hearing can be viewed on the SEC's website. (www.sec.gov)
Item 9.01 Financial Statements and Exhibits
(c) Exhibits
Exhibit Number Exhibit Title of Description
99-1 The Company's answer to the SEC's order instituting an administrative hearing dated April 11, 2005.
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
CMKM Diamonds, Inc., by its attorneys, Stoecklein Law Group, by Donald J. Stoecklein answers the allegations contained in the Order Instituting Administrative Proceeding and Notice of Hearing Pursuant to Section 12(j) of the Securities Exchange Act of 1934 (the "Act"), as follows:
RESPONDENT'S STATEMENT OF FACTS
CMKM DIAMONDS INC. was originally incorporated in the State of Delaware on or about June 9, 1998 as Cyber Mark International Corp. ("Cyber"). On August 3, 1999 Cyber filed a 10-SB12G Registration Statement with the Securities and Exchange Commission to voluntarily become a registrant under Section 12(g) of the Act, which Registration Statement became effective October 4, 1999. At this time Cyber had 6,104,300 shares of common stock issued and outstanding to approximately 41 stockholders.
Cyber's common stock began trading on the Over-the-Counter Bulletin Board on February 15, 2000 under the trading symbol "CMKI".
Cyber's original auditor, Citran Cooperman & Company, LLP served as independent auditors for Cyber from the period ended December 31, 1998 until May 18, 2001, at which time Cyber engaged the services of David E. Coffey, CPA. Mr. Coffey continued as the Registrant's auditor until January 15, 2003.
On or about April 18, 2002, Cyber filed Articles of Conversion with the Secretary of State of the State of Nevada, in order to change its corporate domicile, resulting in Cyber becoming a Nevada Corporation.
On or about November 25, 2002, Cyber entered into a Claims Purchase and Exploration Rights Agreement with Urban Casavant, Individually and as Agent for Fort A LA Corne Diamond Fields, Inc., Buckshot Holdings, Ltd., Commando Holdings, Ltd, 191919307 Saskatchewan Ltd, 101012190 Saskatchewan Ltd, 101027101 Saskatchewan Ltd and Morgan Minerals, Inc. collectively "Sellers," wherein Sellers conveyed to Cyber all rights, title and interest in the exclusive mineral exploration and mining rights on all or any portion of the Property Claims defined within the Agreement, in exchange for 2,800,000,000 shares of Cyber's restricted common stock with registration rights and $2,000,000. Upon effectiveness of the Agreement, Ian McIntyre, Cyber's then current officer and director, prior to his resignation appointed: (i) Urban Casavant as Chairman of the Board, President and CEO; (ii) Carolyn Casavant as a member of the Board of Directors and as Vice President of Claims; and (iii) Wesley Casavant as Secretary/Treasurer. Urban Casavant, Carolyn Casavant, nor Wesley Casavant had U.S. public company reporting experience at the time of their appointments. As a result of the acquisition Agreements, on or about December 3, 2002, Cyber's Articles of Incorporation were amended to change its name to Casavant Mining Kimberlite International, Inc. ("CMKM").
On December 3, 2002, CMKM hired David DeSormeau, a 32 year veteran of financial accounting systems, to act as CMKM's CFO and to work with the auditor to ensure seamless integration with newly enacted Securities and Exchange Commission auditing practices for public companies. Approximately one month after Mr. DeSormeau's engagement, CMKM's auditor resigned. On or about January 15, 2003, at a meeting of a majority of stockholders, Mr. DeSormeau was appointed as a director and Treasurer. Due to CMKM's inability to file its Form 10-KSB on or before March 31, 2003 for the period ended December 31, 2002, CMKM began trading on the "pink sheets" on May 23, 2003, whereon generally, 12g reporting is not a requirement.
On July 22, 2003, upon the advice of counsel, a Form 15 pursuant to Rule 12g-4(a)(1)(i) was filed as certification and notice of termination of registration under Section 12(g) of the Act, stating that at the time of filing the Form 15 CMKM had approximately 300 stockholders of record. A copy of the Form 15 is attached as Exhibit A.
On or about February 5, 2004, CMKM's Articles of Incorporation were amended to change its name to CMKM Diamonds Inc. (the "Company").
On June 4, 2004, the Company retained the services of Roger Glenn, Esq. from the New York law firm Edwards & Angell LLP to assist in preparing the required SEC reports in anticipation of requesting a market maker to resubmit the Company to the Over-the- Counter Bulletin Board for quotation. In a press release dated June 16, 2004, Mr. Glenn was quoted as stating "We have been retained by the Company to resolve the problems it has been facing, and we expect to devote significant efforts immediately toward that goal. The company has advised us that it is dedicated to complying fully with all requirements on it, and we are pleased to act as counsel to it on that basis". In July of 2004, Mr. Casavant suffered a stroke, which left him with no alternative but to rely upon the professionals he had retained to oversee the Company operations until he completed rehabilitation and was able to take control again.
The Company continued its efforts to bring its filings up to date by engaging Neil Levine, of the Firm of Bagell, Josephs & Company, LLC, as independent auditor.
During the 3 rd or 4 th quarter of 2004, the Enforcement Division launched an investigation in the "Matter of U.S. Canadian Minerals, Inc. LA-2937." Under the umbrella of the LA-2937 investigation, the Enforcement Division caused the issuance of subpoenas, deposed and interrogated CMKM Diamonds' consultants and management, inclusive of the Company's new auditor, the Company's financial consultant, and Edwards & Angell LLP. In addition, a subpoena was issued directly to CMKM Diamonds, whereunder the Company supplied significant information to the Commission, including substantial information regarding the Company's mining claims. Urban Casavant, the Company's sole officer and director, as a result of a recent stroke and under the advice of counsel, asserted his 5 th Amendment privilege.
In February of 2005, it was clear to Company management that they needed to be more aggressive if they were to complete the necessary reports for filing with the SEC and to enable a market maker to sponsor the Company to the Over-the-Counter Bulletin Board. Therefore, the Company appointed Mr. Robert Maheu to the Board of Directors in order to oversee the necessary regulatory requirements. Mr. Maheu, on behalf of the Company, immediately retained the services of Stoecklein Law Group on February 7, 2005 for the primary purpose of coordinating the preparation of all reports due under the Act for the respective missing periods. Upon its initial due diligence of the Company, Stoecklein Law Group realized that at the time of filing the initial Form 15, the Company had 698 stockholders of record and that the filing of a Form 15 was not available to the Company as of July of 2003.
On February 15, 2005, Stoecklein Law Group contacted the Division of Corporate Finance for a determination as to the most appropriate method of bringing the Company in compliance with Section 13(a). (See letter from Stoecklein Law Group to Division of Corporation Finance dated February 16, 2005, a copy of which is attached as Exhibit B). On February 17, 2005, Stoecklein Law Group advised the Company to file a Form 15/A which resulted in the Company being subject to the reporting requirements of Section 12(g) of the Act. (A copy of the Form 15/A, filed on February 17, 2005 is attached as Exhibit C). From the date of the filing of the Form 15 (July 22, 2003) until contact with the Securities and Exchange Commission, Division of Corporate Finance by Stoecklein Law Group on February 4, 2005, the Company was under the belief that it was not required to file periodic reports pursuant to Section 13(a) of the Exchange Act. It should be further noted that even though the filing of the Form 15 was flawed on its face, there was no response from the Securities and Exchange Commission to the Company.
During March 2005 a financial consulting firm was retained to assist the Company in its financial statements and logistical coordination was commenced between management, the financial consulting firm, the audit firm, Stoecklein Law Group, and the transfer agent.
On March 16, 2005, the Division of Enforcement filed the Order Instituting Administrative Proceeding against the Company. The Company believes that as a result of the Enforcement Division investigation in LA-2937, the Enforcement Division caused the issuance of a temporary trading suspension on March 3, 2005 and the issuance of the Order Instituting Administrative Proceeding on March 16, 2005. While the actions by the Enforcement Division are designed to be remedial, they may in fact be causing a punitive effect on the Company's stockholders by further perpetuating a growing "naked short" position in the Company's stock, as alleged by numerous stockholders.
WITH RESPECT TO SECTION I
Respondent CMKM Diamonds admits, upon information and belief, that the Commission's public official files disclose the matters set forth in paragraph 1, and refers to said files for their contents.
WITH RESPECT TO SECTION II
With respect to paragraph 1 of Section II, Respondent CMKM Diamonds: admits, that Respondent is a Nevada corporation based in Las Vegas, Nevada; admits that Respondent CMKM Diamonds' common stock is registered under Section 12(g) of the Exchange Act; however, Respondent CMKM Diamonds alleges that it does not have and cannot obtain information sufficient to admit or deny any other allegations contained in such paragraph, and on that basis denies such allegations.
With respect to paragraph 2 of Section II, Respondent CMKM Diamonds admits, upon information and belief, that the Commission's Section 13(a) of the Exchange Act rules disclose the matters set forth in paragraph 2, and refers to said files for their contents.
With respect to paragraph 3 of Section II, Respondent CMKM Diamonds admits the allegations contained in such paragraph.
With respect to paragraph 4 of Section II, Respondent CMKM Diamonds does not have and cannot obtain information sufficient to admit or deny the allegations contained in paragraph 4, except admits that a Form 15 was filed under the name of Casavant Mining Kimberlite International, Inc. on July 22, 2003.
With respect to paragraph 5 of Section II, Respondent CMKM Diamonds admits the allegations contained in such paragraph.
With respect to paragraph 6 of Section II, Respondent CMKM Diamonds denies the allegations contained in such paragraph.
WITH RESPECT TO SECTION III
With respect to Section III, Respondent CMKM Diamonds does not have and cannot obtain information sufficient to admit or deny the statements contained in said paragraph, however, denies that a public administrative proceeding instituted pursuant to Section 12(j) of the Exchange Act is appropriate for the protection of investors.
With respect to Section IV, Respondent CMKM Diamonds admits, upon information and belief, that the Commission's public official files disclose the matters set forth in said Section, and refers to said files for their contents, and the Orders stated therein.
This Respondent, CMKM Diamonds denies each and every allegation of the Division of Enforcement not herein admitted, qualified, or denied.
FIRST AFFIRMATIVE DEFENSE
Respondent CMKM Diamonds alleges and believes that the Commission lacks authority to conduct the proceedings herein.
SECOND AFFIRMATIVE DEFENSE
The allegations of the Office of the Division of Enforcement fail to state a claim upon which the Commission can render sanctions as requested in Section III B of the Order Instituting Administrative Proceeding.
THIRD AFFIRMATIVE DEFENSE
The allegations of the Office of the Division of Enforcement are barred by laches.
In light of the allegations contained in Section II, paragraph 1 and paragraph 2, of the Division of Enforcement, the allegations that the Commission deems it necessary and appropriate for the protection of investors that a public administrative proceeding be instituted against Respondent CMKM Diamonds, Inc. to suspend for a period not exceeding twelve months, or revoke the registration of each class of CMKM Diamonds' securities is inconsistent with Section 13(a) of the Exchange Act and Rules 13a-1 and 13a-13 thereunder.
FIFTH AFFIRMATIVE DEFENSE
In light of the Statement of Facts as enunciated by Respondent, Respondent deems the sanctions as proposed by the Division of Enforcement to be punitive remedies against individual and indispensable parties who have not had an opportunity for appearance herein, and on that basis it would be unconstitutional for the Commission to take any disciplinary action based thereon.
SIXTH AFFIRMATIVE DEFENSE
In light of the Statement of Facts as enunciated by Respondent, Respondent deems the sanctions as proposed by the Division of Enforcement to be punitive in nature against the Respondent CMKM Diamonds for the following reasons:
Respondent, pursuant to Rule 12g-4(b), had 60 days after the filing of the amended Form 15 on February 17, 2005, which would be on or about April 17, 2005, to file its reports. Respondent's actions lack egregiousness, in that its obligations did not occur until after the filing by the Commission of the Order at hand.
9
Respondent's actions were isolated and not recurrent in that once the Respondent learned of the requirement for filing the amended Form 15 on February 15, 2005, the Respondent immediately commenced setting into motion the preparation of financial statements, setting meetings with the Company's auditor, and counsel for the Company in anticipation of the preparation of the periodic reports.
Respondent lacked the scienter required for willful misconduct, in that Respondent relied on the advice of counsel indicating that no reports were required after the filing of the Form 15 on July 22, 2003.
Respondent has demonstrated the sincerity of Respondent's assurances against future violations by nominating an additional board member for purposes of conducting an internal investigation of the Respondent's corporate matters, setting up procedural internal controls, and setting into motion the coordination of bringing current the outstanding periodic reports. As a result, significant dollars have been spent by Respondent to assure its corporate compliance with the reporting requirements of the Act.
Respondent recognizes that it was of the mistaken belief that Respondent was not required to file periodic reports as of July 22, 2003, and has recognized the wrongful nature of its failure, and has taken corrective action.
Respondent has established significant reporting controls to provide assurances that Respondent will not either mistakenly, or intentionally violate the reporting requirements, once such reports are brought up to date and current.
Respondent's financial position is such that Respondent is able to incur the costs associated with its reporting obligations.
Respondent has retained professionals specializing in federal securities and public company reporting requirements and is sincere in its desire to continue with its reporting requirements under the Act.
SEVENTH AFFIRMATIVE DEFENSE
That the relief sought in Section III B is vague and ambiguous.
EIGHTH AFFIRMATIVE DEFENSE
In Section II, paragraph 3 the Division of Enforcement alleges that CMKM Diamonds has not filed an Annual Report on either Form 10-K or Form 10-KSB since May 9, 2002, or quarterly reports on either Form 10-Q or Form 10-QSB since November 18, 2002. Respondents first missed filing of a periodic report was on March 31, 2003, when the Respondent's did not file its Form 10-KSB for the period ending December 31, 2002. In Section II, paragraph 4 the Division of Enforcement alleges that CMKM Diamonds filed a Form 15 on or about July 22, 2003. Respondent was under the belief, mistaken or otherwise, that its duties as an issuer was suspended immediately upon filing its Form 15 certification pursuant to 12g-4(b). Therefore, Respondents failure to comply, if at all, with Section 13(a) was not known until February 15, 2005, when counsel for the Respondent discovered the error, and filed the amended Form 15, thereby subjecting the Respondent to its reporting obligations.
Respondent alleges as an Eighth Affirmative Defense that pursuant to 12g-4(b), Respondent was entitled to a 60 day period, expiring on April 17, 2005, following the filing of the Form 15/A to bring its missing reports current. Therefore, any proceeding to revoke or suspend the registration of the Respondent's securities is premature.
NINTH AFFIRMATIVE DEFENSE
In light of the allegations contained in Section II, paragraph 1 and paragraph 2, by the Division of Enforcement, the allegations that the Commission deems it necessary and appropriate for the protection of investors that a public administrative proceeding be instituted against Respondent CMKM Diamonds, Inc. to suspend for a period not exceeding twelve months, or revoke the registration of each class of CMKM Diamonds' securities is inconsistent with the allegations contained in such paragraphs. The purpose of the sanction imposed is intended to be remedial in nature, not to punish the respondent or its stockholders but to protect the public, to achieve voluntary compliance with the law and to deter the respondent from future violations.
As an affirmative defense to the proposed sanctions, Respondent proposes that Respondent: (i) has no prior record of non-compliance with SEC regulations; (ii) has voluntarily taken corrective action by contacting the Commission itself prior to the issuance of an Order Instituting Administrative Proceeding; (iii) has demonstrated to the Commission a willingness to take corrective action; (iv) has cooperated with the Commission; (v) the alleged violations are not fraudulent in nature; (vi) there was no intent by Respondent to not comply with Section 13(a) of the Exchange Act and Rules 13a-1 and 13a-13 thereunder; (vii) Respondent's management was inexperienced in operating a public company; (viii) Respondent's sole officer and director suffered serious health issues during a portion of the time period referenced; (ix) Respondent relied upon the professional advice of prior counsel in filing the original Form 15; and (x) Respondent brought to the attention of the Commission, the very issue for which the Commission has instituted the Administrative Hearing.
Some conscientious readers sent us emails asking some very good questions that we felt should be addressed to the entire CMKX body of shareholders. These questions are very apropos for today's CMKX investor. First, let me share with you one email that we received.
"From: CMKX Shareholder To: info@zoomingstocks.com Subj: CMKX
Why is it that everyone else makes the money here, it seems the owners of CMKX and theirs are doing well, the naked shorters are doing well, but the stockholders are suffering? Can't the company do anything to stop the naked shorting and force a short squeeze?
I myself am not wealthy but I put all my daughter and I have into this company weeks after it started reporting as a diamond mining company in early 2003. It shows such promise. And what is with the stocks they passed out that aren't really stocks at all but more like IOU's? Who is going to coach us into how to grow our own company and let the naked shorters be squeezed? What is the best strategy for that?
Is the attorney hired by the investors to protect them from the SEC a good idea? Should we all be sending in our twenty five dollars? I am not sure what is going on. I do like that you mentioned it is the stock play of the century but you did fail to tell us which century.
Virginia Stockholder of CMKX"
Where's the Beef?
As you can see one of the primary issues is "Who is making money here?" I also want to ask that question and see if we can arrive at some answers.
In the case of the CMKX Owner's making money and doing well, I have doubts about that. The CMKX Management is expending money's for drilling operations, attorneys, the CMKXtreme Machine and other racing ventures. Based on common knowledge and the things we know about CMKX there is no revenue stream coming into the company. They have a high monthly burn-rate because of ongoing activities and no money coming in that has been reported. They have yet to issue any reports about the sale of property, diamonds or anything. Therefore, it is difficult to believe that they are making any money.
Additionally, a company only makes money on their initial entry into the market. This means an Initial Public Offering or a Reverse Merger into the market through a shell, which is what CMKM Diamonds did a couple of years ago when they bought the CMKI shell. Subsequent sale of stock is in the market and only market makers and brokers make money from the transactions. Therefore, CMKX has not made any money on the sale of stock in the market since on or about September 2002.
The naked shorters, if they in fact exist, of course are making money as would be any market makers involved in shorting CMKX. At this time other than events reported in the past year concerning the O'Quinn Task Force and other articles concerning known market maker activity, we in fact know very little about who is actually behind this egregious act. To acknowledge the severity of what is going on with naked short selling, naked short selling in many opinions, is a term that legitimizes an act of "thievery" perpetrated by institutions that have been tasked with the care and feeding of our economy. The abuse on the "stock borrow program" to naked short Pink Sheet and OTCBB stocks should be acknowledged as being more serious that it is being made out to be.
A shareholder from Canada wrote to us, responding to our recent press release and had this to say:
"Just one comment - the words naked shorting means nothing to the general public. I see the SEC and Donaldson using the word shorting in front of senators to try to fool them. Let's start calling this what it is "Share counterfeiting." Counterfeiting has a solid ring to it and the public needs to understand it is wrong."
The reader's comment puts things in perspective. It is illegal to counterfeit U.S. currency but not illegal to counterfeit stock shares which is representative of "investor money". Basically, it appears that they are walking away with the money and leaving the investor holding a "bogus" piece of electronic paper that says they own stock in a company when they really do not. What is wrong with this picture! Counterfeiting is counterfeiting and stealing is stealing. When is it going to end?
This begs the question, "What can the company do about the "share counterfeiting" and how can they force a short squeeze?" What does it take to force a "short squeeze" and can CMKX do anything about it with such a huge share structure? There are many ways to accomplish a short squeeze and the opinions vary from investor to investor. The problem we are experiencing is beyond anything that any of us can conceive. The only way to correct this problem is on a large scale. Our government, (The SEC), will actually have to step up to the plate in support of investors to correct the problem. Regulation SHO has so much promise, but has yet to be enforced to the point where anyone (institutions) has had to pay the price for these crimes. It is time for the SEC to enforce Regulation SHO and protect the individual investor and the companies that are trying to live out their dreams of being successful public companies.
Where are the Divys?
Our first responder also alluded in the email about the U. S. Canadian Minerals, (USCA), Juina Mining Company, (GEMM) and Casavant International Mining, (no symbol), dividends that were received some months ago. Are they in fact "IOU's", "placeholders", "frames", call it what you will, but did investors actually receive a dividend? That question is still "up in the air" as are many of the issues that we face today as CMKX investors. I am certain that CMKX shareholders would love a response from the company on what in fact transpired with these dividends and how do they fit in the overall strategy to increase shareholder value. And what about the second GEMM dividend that was announced to shareholders but was never received? That is a question for the U.S. Canadian Minerals, Juina Mining Company folks to address. However, CMKM Diamonds should be seeking those answers for their shareholders who have been kept waiting.
Mass Representation by an Attorney?
Our reader asked the question "Is the attorney hired by the investors to protect them from the SEC a good idea? Should we be sending in our twenty five dollars?" Of course, shareholders need to do what they are comfortable doing, especially if it means that they have to pay money for it. Will the shareholders see any value from the contribution to the cause? That remains to be seen because each person will evaluate the process differently. Is it worth the money to be represented and will it accomplish anything? The administrative hearing is for CMKM management to present evidence to support their failure to provide periodic filings in accordance with SEC regulations and resolve some other matters dealing with governance issues. Is this the appropriate time for shareholders to be stepping in and possibly complicating the hearing by requesting to be represented? The only time that the shareholders interests will be considered is during the deliberations where it will be determined if suspension or revocation is in order. During the rest of the proceedings the shareholders will not have any reason to be represented.
Shareholders at large are feeling powerless and feel that the SEC representing them as a "protector" of the people is ineffective. If their aim is to protect investors, then how will suspending the company's trading or revoking their securities help or benefit the shareholder? It does not appear that there would be benefit to the shareholder if this were to happen. The SEC does not seem to have any control of the counterfeiting of shares. The fact that millions of investors, and thousands of companies are getting "ripped off" is evidence of the SEC's lack of control. Yet the SEC claims to be protecting the investor from companies that they feel are not compliant with regulations put in place for the protection of the individual investor. Kind of hard to get our arms around that one, however, we need to let our justice system work and let CMKX management have their "day in court" to present their case and continue making progress towards correcting the problems of the past.
In answer to the question of paying $25.00, that is an individual decision each investor will have to make and live with. Some investors feel that it is worth investing the money while others feel that shareholders will only be assisting the initial client defray his attorney fees by having other investors contribute. In the end it remains an individual decision.
Stock Play of the Century?
Which century you say? Well we certainly hope that it is this century, this year, and this month that investors receive "full disclosure" as a result of the administrative hearing. Many CMKX shareholders will be attending the hearing and will get the word out quickly as to the resolution of these issues.
"Additionally, a company only makes money on their initial entry into the market. This means an Initial Public Offering or a Reverse Merger into the market through a shell, which is what CMKM Diamonds did a couple of years ago when they bought the CMKI shell. Subsequent sale of stock is in the market and only market makers and brokers make money from the transactions. Therefore, CMKX has not made any money on the sale of stock in the market since on or about September 2002."
If this is true then someone please explain to me the following. This is from the 10QSB filed Nov 18, 2002 As of September 30, 2002, 352,223,510 shares of the Issuer's Common Stock were outstanding. If the company is now at 703 Billion outstanding shares then CMKX must have done something to get more shares into the market place and you can't tell me that they didn't make money on this. 700 Billion shares at .0001 is $70 Million. Even if Urban has kept half so he has controlling shares, that is $35 Million if sold at .0001. If he has been selling all along then he has made much more than this from the sounds of things.
I have no idea how they got the additional shares into the market but it makes me go hmmm.
Posts: 2375 | Registered: Nov 2004
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posted
Legal I think I hear Urban calling for you, he needs you to wipe his *
-------------------- Be Careful Of The Toes We Step On Today, They Could Be Attached To The Butt We Have To Kiss Tomorrow Posts: 4727 | From: Elk Grove ( Sacramento )CA USA | Registered: Jun 2004
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posted
CMKX IS A SCAM NOTHING MORE AND NOTHING LESS
BUYER BEWARE, DON'T DRINK LEGAL'S KOOL AID
-------------------- Be Careful Of The Toes We Step On Today, They Could Be Attached To The Butt We Have To Kiss Tomorrow Posts: 4727 | From: Elk Grove ( Sacramento )CA USA | Registered: Jun 2004
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posted
Legal, I only have one question, and if you can answer it I'll help you pump.... CMKX is now filing only PRs that explain what has happened with the SEC.
Why cant they file useful information, like drilling results, all the numbers we need to figure out what we have, etc etc.????
And dont tell me the SEC is preventing them from giving information to the shareholders. Maheu himself said they would be forthcoming with more info to keep the shareholders updated. Where is it??
If it's a scam, it's a good one. Personally, I'm telling everyone NOT to buy until all this is straightened out.
-------------------- If I give you bad information, please feel free to sue me. I have nothing left anyway. Ed Posts: 1772 | From: Oxford, PA, USA | Registered: Oct 2004
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quote:Originally posted by ed19363: Legal, I only have one question, and if you can answer it I'll help you pump.... CMKX is now filing only PRs that explain what has happened with the SEC.
Why cant they file useful information, like drilling results, all the numbers we need to figure out what we have, etc etc.????
And dont tell me the SEC is preventing them from giving information to the shareholders. Maheu himself said they would be forthcoming with more info to keep the shareholders updated. Where is it??
If it's a scam, it's a good one. Personally, I'm telling everyone NOT to buy until all this is straightened out.
Read the post above from Zooming Stocks.
Posts: 2375 | Registered: Nov 2004
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Legal is trying to divert attention from anyone contacting the SEC about their convictions, so I am reposting the following:
For those of you who wish to complain to the SEC concerning Urban Casavant, CMKX, statements made by CMKX officials, statements made by their current law firm and the complete disregard and violation of shareholder interests by Casavant and/or CMKX the address is as follows:
I intend to ask the SEC to apply all the pressure possible in getting out the truth, in getting information (financial and otherwise) published and not to give them an easy out with leniency. I believe they should be punished to the fullest extent possible under the laws.
The more of us that contact the SEC with prior information of which they may not be aware the greater will be the favorable outcome and shareholders will finally have a voice. CONTACT THE SEC WITH YOU INFORMATION AND CONCERNS!!!!! I have already done so.
Legal also reposted a post which included the following:
"7)CMKX's lawyer is "David Stoecklein". 8)USCA gave money to "Crystalix" 9)John Dhonau is President of Crystalix 10)Ed Dhonau is said to be one of the largest shareholders of both CMKX and USCA."
If I remember correctly, it was Ed Dhonau who has a somewhat questionable past involving sales of securities.
The approach UC and law firm are taking is "A good offense makes the best defense". Hopefully, it will not work with the SEC. Send the SEC all the information you can to thwart any cover-up and lies.
Posts: 3607 | From: NJ - Outside Phila. | Registered: Mar 2004
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posted
Shareholders Members Group numbers give us some idea of the naked short. And this group is growing daily.
kahuna God of Diamonds
member is offline
Gender: Posts: 531 The highest NSS known to mankind... « Thread started on: Today at 12:44pm »
-------------------------------------------------------------------------------- Well, here it is. I was cruisin the boards to see whats out there today when I caught CDLIC post about the cmkm group and the shares they represent..
577 members
85,994,159,301 shares
OK Great. Now lets take the law of averages here and multiply both by a factor of 100 to try to get to an approximate total of shareholders in cmkx.
57700 members
8,599,415,930,100
ok that share number is 8 trillion...
now, this is just taking two numbers which is fact, multiplying by a hundred to get an approximate shareholder base...
If the NSS is anywhere near this, then what is the correct action that should be taken here. I mean this has never been concieved before much less brought to light tothe public
Posts: 2375 | Registered: Nov 2004
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That is not an answer....there are too many posts. Why is the information not being given to shareholders?
Simple question? Can you answer it, or are you as full of BS as your posts?
-------------------- If I give you bad information, please feel free to sue me. I have nothing left anyway. Ed Posts: 1772 | From: Oxford, PA, USA | Registered: Oct 2004
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quote:Originally posted by Wallace#1: Legal is trying to divert attention from anyone contacting the SEC about their convictions, so I am reposting the following:
For those of you who wish to complain to the SEC concerning Urban Casavant, CMKX, statements made by CMKX officials, statements made by their current law firm and the complete disregard and violation of shareholder interests by Casavant and/or CMKX the address is as follows:
I intend to ask the SEC to apply all the pressure possible in getting out the truth, in getting information (financial and otherwise) published and not to give them an easy out with leniency. I believe they should be punished to the fullest extent possible under the laws.
The more of us that contact the SEC with prior information of which they may not be aware the greater will be the favorable outcome and shareholders will finally have a voice. CONTACT THE SEC WITH YOU INFORMATION AND CONCERNS!!!!! I have already done so.
Legal also reposted a post which included the following:
"7)CMKX's lawyer is "David Stoecklein". 8)USCA gave money to "Crystalix" 9)John Dhonau is President of Crystalix 10)Ed Dhonau is said to be one of the largest shareholders of both CMKX and USCA."
If I remember correctly, it was Ed Dhonau who has a somewhat questionable past involving sales of securities.
The approach UC and law firm are taking is "A good offense makes the best defense". Hopefully, it will not work with the SEC. Send the SEC all the information you can to thwart any cover-up and lies.
No need to divert from such pathetic attempts. I encourage all to contact the SEC with any information that they have concerning this company. And including any evidence of "pumping" and "bashing". If you are seeking an escalation Wallace, to add to your "importance", I say, "Bring it on, bud."
Posts: 2375 | Registered: Nov 2004
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legal? i'm not a UC buff by any means, but i've heard over and over again how he has so much experience in business, now they claim the ignorance defense?
-------------------- Don't envy the happiness of those who live in a fool's paradise. Posts: 36378 | From: USA | Registered: Sep 2003
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quote:Originally posted by ed19363: That is not an answer....there are too many posts. Why is the information not being given to shareholders?
Simple question? Can you answer it, or are you as full of BS as your posts?
ed, information given to shareholders is information given to the DTCC, MM's, and competitors. CMKX is involved in a war, they aren't going to give away their positions to the enemy.
Posts: 2375 | Registered: Nov 2004
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