by Mike Caswell
The U.S. Securities and Exchange Commission has won a permanent penny stock ban against Vancouver promoter Victoria Chen for selling unregistered shares in an OTC Bulletin Board company. The ban is contained in an order handed down on Nov. 27, 2012, by New York Judge Richard Berman, who agreed that Ms. Chen showed a "reckless disregard" for U.S. registration requirements. She acquired shares in a sham contract, and failed to acknowledge she did anything wrong, the judge wrote.
The ban stems from a 2005 scheme in which Ms. Chen and others received 1,756,000 free-trading shares of Recov Energy Corp., a company that touted itself as a waste recovery outfit. The SEC said she received stock as part of a bogus promissory note conversion. She and others then allegedly sold some of the shares as the company released news about a deal to acquire "revolutionary technology" to recover energy from waste.
In asking for the ban, the SEC claimed that it was necessary to keep Ms. Chen from "preying on the investing public." In an Oct. 1, 2012, motion, the regulator said it was likely she would offend again. "She has shown a clear propensity to knowingly violate the law and enjoyed lucrative returns as a result," the motion read.