Who is Teodisio Pangia? In Part I of this series we began to explore some of Mr. Pangia’s business interests and relationships. But there are more – and they involve a cast of intriguing characters, as we soon discovered.
Ain’t It Grand
Teodisio V. Pangia did not abandon his interest in public companies as he liquidated his holdings in Environmental Solutions. Maybe he was just moving on to something grander – a U.S. company called Grand Enterprises, Inc. Shares of Grand Enterprises are not publicly traded – yet. The Company is, however, in the process of registering 22.5 million shares to be sold by a group of selling shareholders, including, as we shall see shortly, a list of names that are already familiar to Stock Patrol readers.Grand Enterprises was formed in April 2000 as a “blank check” shell in search of an operating business. Its sole officer and director was one Patricia Meding, who was also the sole officer, director and a controlling shareholder of Capital Advisory Partners, LLC, the firm that had been retained to find an operating business for Grand Enterprises.
Capital Advisory Partners was also one of the original founding shareholders of Grand Enterprises, having been issued 800,000 shares for the not so grand sum of $80. The Company’s other founding shareholders were Kilkenny Group LLC; Rathgar LLC; Finglas LLC; and Monkstown LLC, each of which had also been issued 800,000 shares of Grand Enterprises common stock for $80. If those names ring a bell, they should. As we recently discovered, those entities have a good deal in common, including their participation in a number of business ventures involving Infotopia, Inc. (See Update: Infotopia, Inc. – What A Difference Three Months Make).
But more about that later.
Grand Enterprises found a business - and Teodisio V. Pangia - in April 2001 when it merged with EC2000, Inc., a private Delaware company. Pangia was President and controlling shareholder of EC2000, whose sole asset seemed to consist of the right to file for a patent on “a fuel treatment system…that will increase fuel efficiency and reduce harmful exhaust emissions.” Pangia replaced Meding as an officer and director of Grand Enterprises and, once again, was involved with a business whose future appeared to depend on the uncertain prospects of an energy-based technology. EC 2000 had no revenues, and had not even filed for the patent. So far, it seems, neither has Grand Enterprises.
Although the Grand Enterprises Registration Statement says that EC2000 “manufacturers (sic) and markets a line of electrical conservation devices for energy applications in natural gas and liquid fuels” it does not appear that EC2000 actually manufactured or sold any devices prior to the merger. As of December 31, 2000, EC2000’s operations had been limited to “organizational activities” and the Company had generated no revenues from sales.
Much the same can be said for Grand Enterprises. As of September 30, 2001 (according to the Company’s financial statements), Grand Enterprises still was engaged solely in organizational activities and had generated no revenues from operations.
The absence of business operations hasn’t deterred Grand Enterprises from registering those 22.5 million shares for sale to the public. The shareholders of EC2000 at the time of the merger included TVP Capital (the consulting firm controlled by Pangia), and Bondy & Schloss (the lawyers for EC2000). Now TVP and Bondy & Schloss are among the selling shareholders listed in Grand Enterprises’ Registration Statement, together with Capital Advisory Partners; Kilkenny; Rathgar; Finglas; Monkstown; and a host of others, including Gorda Private Investors, Ltd (250,000 shares) and a pair of companies owned or controlled by Teodisio Pangia: Altea Investments Ltd. (1 million shares), and Gata Investments, Ltd (1 million shares).
Of course, Stock Patrol readers have seen some of those names before. Altea, Gata and an entity called Gorda have been among the selling shareholders listed on Registration Statements filed by Infotopia and Ives Health Company. In total, companies owned or controlled by Pangia have now registered to sell 9,710,000 shares of Grand Enterprises stock. That’s more than 43% of the outstanding Grand Enterprises shares.
This is not the first time Bondy & Schloss has appeared as a selling shareholder in a Registration Statement filed on behalf of one of that law firm’s clients. Infotopia, for example, has registered more than 6 million shares in the name of Bondy & Schloss on various SB-2 and S-8 Registration Statements. Most recently, on November 16th, Bondy & Schloss filed a Form 4 with the SEC identifying the law firm as a 10% owner of Infotopia, and acknowledging that 1,607,164 shares of Infotopia stock had been sold by Jeffrey Rinde for the benefit of Bondy & Schloss between October 4th and October 31st.
See Ya Later Altea and Gata
As we noted earlier, Altea has appeared as a selling shareholder before – on Registration Statements filed by Infotopia. Infotopia registered more than 20.7 million shares for Altea on January 11, 2001 and another 11.6 million shares on April 3, 2001. And while Infotopia identified Altea as a British Virgin Island company, the Registration Statement – filed by Bondy & Schloss – did not mention that Altea was owned or controlled by Teodisio Pangia. See Infotopia, Inc. – Bye Bye Shares; and Update: Infotopia – Friday Night Special.We found Altea once again in a Registration Statement, filed by yet another Bondy & Schloss client, Ives Health Products, Inc. (See Ives Health Company – Ives Wide Shut). And this time, Altea was keeping company with a pair of other entities controlled or owned by Pangia. On November 6, 2000, Ives filed to register 4,571,429 shares on behalf of three “selling stockholders”: Altea; Gata Investments (identified as a British Virgin Island company); and TVP Capital. Ives didn’t say who owned Altea, Gata or TVP, but the Registration Statement filed by Grand Enterprises on October 17, 2001 reveals that Teodisio Pangia owns or controls all three entities – together with several other Grand Enterprises selling shareholders.
Ives said that it had agreed to issue stock to the three companies, at a significant discount to public share prices, in exchange for up to $2.4 million in periodic financing draws. Ives also agreed to pay Bondy & Schloss 4% of each draw as a “finders fee” for having introduced Ives to the three purchasers. In addition, Bondy & Schloss had been issued 200,000 shares of Ives stock and warrants to buy another 544,000 shares at 50 cents per share.
Trading in Ives shares was suspended on March 5, 2001 after the SEC raised “questions regarding the accuracy of public statements by Ives Health to investors concerning, among other things, a product being marketed by Ives Health for treatment of human immunodeficiency virus.” Ives and its founder, Keith Ives, now face criminal charges relating to those statements. (See Update: Ives Health Company – When It Rains, It Pours).
The relationship between Altea and Bondy & Schloss is one focus of a lawsuit filed against the law firm, Infotopia, Jeffrey Rinde, and another Bondy & Schloss partner, Gerald Adler, in the New York Supreme Court. In that case the plaintiffs, a company named J Group, and its owners, allege that Rinde arranged for a $100,000 loan to J Group from another Bondy & Schloss client, Altea Investments, Ltd. in December 2000. According to the complaint, when J Group couldn’t make timely loan payments, Rinde purportedly recommended that the J Group business be sold to yet another Bondy & Schloss client, Infotopia. The owners say they resisted, and instead transferred certain product licensing rights in exchange for Infotopia shares. But J Group alleges that Bondy & Schloss controlled those shares, and sold them for less than had been promised.
Are there other relationships between Grand Enterprises and Infotopia? The Grand Enterprises Registration Statement lists Gorda Private Investments, Ltd. as a selling shareholder, but provides no information about the owners, officers or business of Gorda. Is this the same company that is referred to as Gorda Investments Ltd. in a Registration Statement filed by Infotopia on March 27, 2001? Infotopia was registering 120 million shares of its common stock for Gorda Investments, but Infotopia, like Grand Enterprises, offered no details about Gorda’s ownership or nationality. Perhaps Bondy & Schloss know the answers to those questions. They are identified as counsel for Infotopia and Grand Enterprises on the respective Registration Statements.
Elite Investors
We discovered one other Bondy & Schloss client that appears to have something in common with Infotopia. A company called Pro-Elite filed an SB-2 Registration Statement with the SEC on August 31, 2001 seeking to register 24.8 million shares of common stock, including 11.5 million shares owned by Joseph Blumenthal, 1.05 million shares owned by George Bally, and 150,000 shares owned by Bradley P. Barnes.By now, Stock Patrol readers recognize the name Joseph Blumenthal. On February 2, 2001 we reported that Joseph Blumenthal was President of JB Marc and Associates, Inc. a firm that purchased 2.5 million Infotopia shares for $967,000 on August 21, 2000. Those shares were included in a Registration Statement filed by Infotopia on October 6, 2000. (Shares issued to a George Bally (950,000 shares), a George Bally, Jr. (812,500 shares) and a Bradley Barnes (705,000 shares) were included on that same Infotopia Registration Statement. (See Infotopia, Inc. – Bye, Bye Shares).
And then there’s this. On September 4, 2001, we reported that HIV-VAC, Inc., a company that is purportedly working on a cure for HIV/AIDS, had filed a Registration Statement on August 22, 2001 for 25 million shares that could be issued to a company identified as Bromley Holdings, Inc. of Hewlett, New York. As we learned, HIV-VAC had sold one million shares of Convertible Preferred Stock to Bromley for $10,000. Each of those Preferred Shares could be converted into shares of HIV-VAC common stock at a substantial discount for the prevailing public prices. As part of the deal, Bromley also received warrants to buy an additional 5 million common shares. (See HIV-VAC, Inc. – You Gotta Have Friends).
Who controlled Bromley? The Registration Statement did not say, but subscription forms for the preferred shares identified “Joe Blumenthal” as President of Bromley.
And who were the attorneys for HIV-VAC? The August 22, 2001 Registration Statement identified the Company’s counsel as Jeffrey Rinde and Bondy & Schloss.
The name Joseph Blumenthal has come up in other contexts as well. His firm, JB Marc, had received shares of a company called Far East Ventures, Inc. (which subsequently became Nico Telecom), for certain “consulting services.” Those shares were registered on a Form S-8. (See Far East Ventures – Consultants To Spare)
JB Marc shared office space in New York City with Alan Berkun, another individual who had received shares of Infotopia and Far East Ventures in exchange for consulting/legal services. (See Infotopia, Inc. – Bye, Bye Shares; and Far East Ventures – Consultants To Spare).
There apparently was more to the Berkun-Blumenthal relationship. In 1998 the National Association of Securities Dealers issued an order naming both men in connection with investor fraud charges that had been filed against the brokerage firm of Lexington Capital Corporation. As a result of that proceeding, Berkun and Blumenthal each were barred from associating with any NASD member firm.
The names Berkun and Blumenthal have been back in the news recently. On October 18th the United States Attorney for the Eastern District of New York announced that Alan Berkun had been indicted and charged with participating in a scheme to manipulate the stock of two public companies – Americom Networks International, Inc. and Global Eco-Logical Services, Inc.
What about Blumenthal? On November 16, 2001, the SEC released an Order barring Joseph M. Blumenthal from participating in any offering of penny stock, in any capacity, including as a consultant or promoter. In its Order, the SEC noted a September 26, 2001 Order by the United States District Court for the Southern District of Texas, fining and enjoining Blumenthal as a result of his participation in the sale of unregistered securities.
Maybe there is something to that theory about six degrees of separation. Then again, perhaps the players here are not even that far apart – as we will see in the next part of this series.
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