Hugh Austin Eugene W Austin $117m Default Judgement - Pump and Dump - Fraud

- Hugh a/k/a Eugene W. Austin - Austin's unedifying history includes a ** $117M ** default judgement against him in favor of the court appointed receiver on accusations of assisting James Capwill to launder money in the Liberte viaticals scam. Case # 1:03-cv-02550 in USDC Ohio northern district. A civil suit brought by the receiver in the Capwill etc scam for assisting with money laundering; apparently in control of DMBM Inc which has been issued large amounts of supposedly fee-trading stock at massive discounts to market upon conversion of debt in murky circumstances. 

- Austin was CEO of NY International Commerce Group Inc (a dba for Interlock Services Inc, and also 2DoBiz). This is the entity that VRAL contracted with in 2002 to pursue distribution in China, which I think led to the unapproved trial by Beijing Ditan Hospital in 2003. This was a PR disaster for VRAL, with negative publicity in Newsweek, the FT and elsewhere. Eg: http://www.newsweek.com/2005/04/11/meds-and-miracles.html 

- CEO of Imperial is one Hugh W. Austin. See eg http://eon.businesswire.com/news/eon/20101209006258/en/VRAL/Viral-Genetics/Wide-World-of-Stocks 

- Dissolved the other day by NY state, I think because of failure to pay state taxes. Check it here: http://www.dos.state.ny.us/corps/bus_entity_search.html 

- Bryan G. Crane, confessed criminal in an FBI pennyscam kick-back sting; runs Bluewater Advisory, VRAL's PR firm since Crane's 5 year parole period ended in Feb this year. 

- Paul Giarmoleo, effectively booted out of the brokerage industry for matters including his own role in the Capwill caper; apparently co-principal with Austin of Wonderland Capital, the predecessor of DMBM Inc as VRAL "investor". 

- Imperial Consulting's Port Jefferson NY address is shared by something called Wonderland Capital. This is/was controlled by Austin and one Paul Giarmoleo. (Ref filings in 1:2008-cv-01707 in USDC Colorado eastern district). 

- Giarmoleo is an ex-First Montauk Securities broker who was also accused by the receiver of assisting to launder Capwill money in the Liberte affair. (He & First Montauk settled). He has a bad FINRA sheet, culminating in one year suspension + fines for fraud in 2008 (check http://www.finra.org/Investors/ToolsCalculators/BrokerCheck/ ) He does not appear to have been employed as a broker since then. 

- I don't whether Giarmoleo has a formal position with Imperial Consulting but both he and Austin were issued "consultant" shares by VRAL under the same 2007 S-8. See http://www.sec.gov/Archives/edgar/data/1091326/000121465907001592/0001214659-07-001592-index.htm 

- The S-8 also gave shares to one Jeremy Draper, an associate of Austin and Giarmoleo (see filings in the Colorado case mentioned above). 

- And also to lawyer Martin Weisberg, who was indicted for fraud in 2007 in the Xybernaut/Ramp affair. See http://www.nytimes.com/2007/10/20/business/20trader.html Up until this indictment, Weisberg was VRAL's lawyer in the T&T litigation. Weisberg was also involved with Austin's Interlock at the time it was known as or becoming or whatever 2DoBiz, a US/Canadian operation of substantial shadiness, and one of the vehicles mentioned frequently in the Liberte receiver's actions against Austin and others. 

- As the dubious cherry on top of this dubious confection, VRAL's auditor/accountant Myron Landis was CFO of Interlock/NY Int'l Commerce while Austin was CEO. See eg: http://www.sec.gov/Archives/edgar/data/1096297/000091068002000800/f857066.txt 

- Austin and Giarmoleo's Wonderland Capital garnered 35M+ free trading shares in VRAL in the period 2007 - Apr 2010. See VRAL's pink sheets initial disclosure statement http://www.pinkinvesting.com/uploads/reports/pdf/4853/Annual_Report_-_Information_Statement_08221954.pdf Majority priced at 2c, some at 5c. The disclosure statement glosses these as "issued for cash in private placement" - not sure how the "free trading" part works in that case. Dates are not given but get the impression that some/most were issued at the same time that VRAL arranged for Corey Ribotsky vehicles, Double U Master Fund etc to swap their outstanding convertible debentures for similarly price free trading shares. 

- Not clear how many, if any, of these were issued before the mid-2009 pump and dump in which Imperial Consulting played a large part on the pump side (eg through their Wide World of Stocks broadcasts).  

It's evident that confessed criminal attorney Martin Eric Weisberg has performed work for VRAL 

- Wesiberg, a confessed criminal with a record of facilitating bogus free-trading share scams; doing recent undefined legal work. 

Why has VRAL been paying for the services for a lawyer facing trial on two federal criminal indictments for fraud (pleading guilty to one count from each a few days ago) and a related SEC action? 

The last sentence of the 2011 financials says this: "In February 2012, the Company agreed to issue 6,923,070 of its common shares in satisfaction of $90,000 in outstanding fees to a legal advisor. Of this amount, $72,500 was accrued at December 31, 2011." 

The 6,9230,070 shares mentioned there matches one of the issues of restricted a stock to Wesiberg (see the long issuance list in the info statement). These were issued at $0.0195, so for a total value of $135K. In other words, he got stock worth 150% of the amount supposedly owing to him. 

The fact that only $72,500 was accrued as of year end undoubtedly means that he did further work through Feb, supposedly worth $17,500. 

Subsequent to Feb, he continued to work for VRAL - the issuance list shows him getting another 2,566,475 restricted shares at $0.0146 sometime before the mid-May date of the info statement. 

Of course, VRAL and Weisberg have a long-standing relationship. Eg this S-8 giving him 500,000 shares of free trading "consulting" stock back in July 2007, not long before his Oct 2007 indictment for the Xybernaut/Ramp scam: http://www.sec.gov/Archives/edgar/data/1091326/000121465907001592/c71670s8.htm 

(in conjunction with Hugh Austin, Paul Giarmoleo & others). 

All with history going back together over the years & most with a long, long association with VRAL. 

Some diligence concerning Virl Genetics (VRAL on the pinks), long-running AIDS drug story, now branching out into clean energy. In particular, their IR firm, Imperial Consulting Network www.thinkimperial.com which includes the pathetic "Biotech Stock Review", "Wide World of Stocks" etc. 

- And also to lawyer Martin Weisberg, who was indicted for fraud in 2007 in the Xybernaut/Ramp affair. See http://www.nytimes.com/2007/10/20/business/20trader.html Up until this indictment, Weisberg was VRAL's lawyer in the T&T litigation. Weisberg was also involved with Austin's Interlock at the time it was known as or becoming or whatever 2DoBiz, a US/Canadian operation of substantial shadiness, and one of the vehicles mentioned frequently in the Liberte receiver's actions against Austin and others. 

- As the dubious cherry on top of this dubious confection, VRAL's auditor/accountant Myron Landis was CFO of Interlock/NY Int'l Commerce while Austin was CEO. See eg: http://www.sec.gov/Archives/edgar/data/1096297/000091068002000800/f857066.txt 

- Austin and Giarmoleo's Wonderland Capital garnered 35M+ free trading shares in VRAL in the period 2007 - Apr 2010. See VRAL's pink sheets initial disclosure statement http://www.pinkinvesting.com/uploads/reports/pdf/4853/Annual_Report_-_Information_Statement_08221954.pdf Majority priced at 2c, some at 5c. The disclosure statement glosses these as "issued for cash in private placement" - not sure how the "free trading" part works in that case. Dates are not given but get the impression that some/most were issued at the same time that VRAL arranged for Corey Ribotsky vehicles, Double U Master Fund etc to swap their outstanding convertible debentures for similarly price free trading shares. 

- Not clear how many, if any, of these were issued before the mid-2009 pump and dump in which Imperial Consulting played a large part on the pump side (eg through their Wide World of Stocks broadcasts).