CMKM: The Greatest Financial Statements We've Ever Seen. Ever.
David Coffey, a Las Vegas CPA, had a pretty easy job when he audited the financial statements of CMKM Diamonds in 2002, there were only $344 in assets to account for. You read that right: $344.
So how is it, then, that CMKM is demanding $3.87 trillion from the SEC when they themselves were the ones running the unlimited printing press and issuing stock up the wazoo to dumb "stockholders" willing to bite on their scam?
And how does a company with $344 in assets do a few quick name changes and suddenly have 800,000,000,000 shares to throw out there?
This is from the suit against the SEC (yes, they had the audacity to sue the SEC):
In November and December, 2002, CYBER MARK INTERNATIONAL INC., a public company domiciled in Nevada, reverse-merged with Casavant Mineral Claims, which then held mineral claims to more than 600,000 acres within Saskatchewan, Canada, increased authorized capital from 500,000,000 to 10,000,000,000 common shares, cancelled all preferred shares, and changed its name to CASAVANT MINING KIMBERLITE INTERNATIONAL, INC. (CMKI); as of February 3, 2003, 7,241,653,404 shares were issued and outstanding.
16. During the succeeding months CMKI declared a 2 for 1 stock split and filed with the Securities and Exchange Commission: Form 15 exemption claim, July, 2003; Certificate of Amendment to Articles of Incorporation changing its name to CMKM DIAMONDS, INC. (CMKM), February 5, 2004; Certificate of Amendment to Articles of Incorporation raising its authorized capital to 500,000,000,000 common shares @ $0.001 par value, March 1, 2004; Certificate of Amendment to Articles of Incorporation correcting the par value of common shares as of December 26, 2002 to $0.0001 par value, July 13, 2004; Certificate of Amendment to Articles of Incorporation raising its authorized capital to 800,000,000,000 common shares @ $0.0001 par value, July 13, 2004.
Said the DoJ: "the extraordinary number of authorized CMKM Diamonds shares rendered the price per share almost meaningless: the conspirators controlled the printing presses and issued themselves a seemingly inexhaustible supply of shares and stock certificates; having evaded registration and reporting requirements, the conspirators were able to surreptitiously issue themselves hundreds of billions of shares without disclosure."
The story, should you be curious...
Floyd Norris via NYT in March:
Perhaps the largest case of “buyer’s denial,” at least in terms of alleged damages, is in the fraud involving a tiny company known as CMKM Diamonds, which purported to have valuable diamond mining claims. In reality, what it had was a publicity machine, including the sponsorship of a car at “funny car” races around the country.
Several shareholders in CMKM — some of whom kept buying shares after the government exposed the fraud — want 10 current and former commissioners of the Securities and Exchange Commission to pay them $3.87 trillion, an amount equal to about half the United States government debt in public hands. You might think that would be enough, but the suit claims those are merely compensatory damages. They also want punitive damages, but do not cite a figure.
And now those shareholders have taken to Facebook to pray, hope and wish that their dreams shall come true. This week or next, they repeat, this week or next. You want a good read? Read through some of the comments, especially the part about the screwed up bank transfers and the peasants storming the castle. They're actually holding out for an SEC payoff in the trillions - trillions - and believe the money will magically appear in their accounts this week or next.
The best part - the VERY best part - is that CMKM is blaming naked shorts for their problems, claiming it's their fault and the company wants justice. Really?! Who naked shorts a tiny full-of-shit penny stock company pumping out hundreds of thousands of stocks all safe from the SEC's not-so-watchful eye?
Despite evidence that clearly shows CMKM as a massive fraud, "shareholders" (I use the term as loosely as possible, in the same way I might use "wealthy" to describe an American who has amassed tens of billions of pieces of fake paper called Federal Reserve Notes) spread paranoia and denial all over the place, like this gem calling CMKM's collapse a government sting operation in which hedge funds and TPTB saw something shiny in CMKM's possession and quickly worked together to take it. I'm sure the government doesn't have a reliable uranium field and therefore conspires with hedgies to take someone else's, that sounds totally reasonable.
It must be a conspiracy!..... uhh...