ENERGY SOURCE Remedial Actions
From the time London, UK based CEO Thomas Megas discovered the corporate identity fraud perpetrated by Pino and Thompson, he endeavored to remedy the situation. After Energy Source, Inc. contacted the SEC, they launched an investigation. During the initial corporate investigation, Megas was approached by Mario Pino who introduced himself as a harmed shareholder who had himself been a victim of someone else’s fraud. During this period, Energy Source issued press releases to the public and the market warning of the issuing and trading of unauthorized shares and the commencement of an investigation to determine what had transpired. On agreeing to compensate Energy Source for the damage he’d done and endeavoring to remove the fraudulent shares from the market, Pino and his accomplice Pamela Thompson lied, defaulted on the agreement, and continued to print and distribute further fraudulent certificates. This renewed bout of fraudulent action by Pino and Thompson revealed the extent of their duplicity and the enormity of the fraud perpetrated. Confronted with the apparent destruction of his company Megas and his team resolved to bring those responsible to account and to restore the company to its pre-fraud position. Megas and his team were in contact with the Securities and Exchange Commission (SEC), and the Federal Bureau of Investigation (FBI), issued press releases, and contacted the Depository Trust and Clearing Corporation (DTCC) explaining the fraudulent certificate situation. After much communication and exhortation, the regulators finally took action. The SEC suspended trading in Energy Source for 15 days and the privately owned clearing monopoly the DTCC suspended clearing and settlement services. Faced with a defrauded hijacked corporate entity, hundreds of millions of counterfeit shares in the public market, and the suspension of DTC services, Megas pursued the authors of the fraud in the Oklahoma State Supreme Court, complied fully with the SEC filing requirements, the NASDAQ regulations and NASD rules and then sought to relist Energy Source through its sponsoring broker on the OTCBB exchange, its broker having complied with SEC rule 15c2-11 making quotation and trading possible. Prior to arriving at this point, ENERGY SOURCE and its CEO had to confront and address many issues. First, there was the issue of the fraudulently printed Pino shares, some of which had entered the market through Capital Growth Financial, L.L.C. (CGF) and JH Darbie (JHD). After receiving no assistance from the SEC in a September 2005 meeting regarding the enforcement of SEC rule 203(b) requiring Energy Source naked shorts or those possessing “Fails to Deliver” to cover their positions, Megas resigned to file suit against Pino and his associates. Seeing no other way to appease the DTCC’s opposition to enforcing SEC rule 203(b), Megas consented to deliver shares to CGF and JHD via the Section 3(a) (10) exemption to cover their net short positions, even though CGF and JHD failed in their responsibility to verify the validity of the certificates that Pino and associates deposited with them. The Oklahoma County District Court entered an “Order Approving Settlement Agreement”, which settled the claims between the Company, Mario Pino, his associates and affiliated entities, CGF and JHD. Furthermore, Megas and his team continued the effort to bring Energy Source current with their SEC filings, and pushed forward to satisfy rule 15c2-11 for relisting on the OTCBB. In the fall of 2006, Energy Source became current, obtained a new CUSIP number, obtained a market maker, Legacy Trading, Inc., to sponsor its form 211, and did succeed in relisting its shares on the OTCBB on 10/23/2006. Unfortunately, due to “regulator clerical errors” with the CUSIP numbers, Energy Source never regained DTC services, was not quoted for four consecutive trading days in violation of rule 15c2-11, and was again delisted from trading on 11/6/2006. Subsequent to a December 2006 telephone conference with the DTCC, NASDAQ, NASD, SEC, the company’s transfer agent, and company representatives, Energy Source filed another lawsuit in Oklahoma County District Court in April 2007. This time the defendant list included the entire common shareholder base. The purpose of this lawsuit, as directed by the DTCC, was to identify and eliminate the fraudulent shares from the public market, and establish those in the market who had sold shares to the investing public by means of naked shorting. Unfortunately, because the lawsuit turned into a case that was not what Energy Source originally thought it was pursuing (i.e. a lawsuit against wrongdoers); the Company dismissed this lawsuit after one month. In February 2008, at the tacit understanding of the DTCC, Energy Source filed a form PRE14a proposing a 1 for 200 reverse split of the common shares. Energy Source had a shareholders meeting on June 3, 2008 and the motion was approved and filed via a form 8-K on June 13, 2008. Proceeding with the DTCC’s guidance, Energy Source obtained another new CUSIP number, and on June 11, 2008, filed an amendment with the Nevada Secretary of state for the reverse split to effect on June 27, 2008 and submitted to NASDAQ/FINRA for approval of the name change, CUSIP change, and one for 200 reverse split. All regulatory requirements normally required by a company to trade have been met. This is where the current situation is now stonewalled. In Summary, Remedial efforts undertaken by Energy Source, Inc. Over the last three years, Energy Source, Inc. has filed 35 separate filings with the Securities and Exchange Commission, filed 16 filings with the Nevada Secretary of State, filed two separate protracted lawsuits in Oklahoma County District Court, filed one lawsuit in Arizona State Superior Court, Maricopa County, purchased two new CUSIP numbers, filed form 15c211 to relist on the OTCBB twice, reverse split the common stock at a rate of 1 for 200, and CEO Thomas Megas has personally spent nearly $800,000 all with one goal in mind; the resumption of DTC services and relisting on the OTCBB. Now, after jumping through all the myriad legal hoops put in place by the DTCC, they now refuse to talk to Energy Source.
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