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SEC target Briner responds to Golden Apple charges

2009-11-03 14:41 ET - Street Wire

Also Street Wire (U-*SEC) U.S. Securities and Exchange Commission
Also Street Wire (U-GAPJ) Golden Apple Oil and Gas Inc

by Mike Caswell

Vancouver lawyer John Briner has responded to the U.S. Securities and Exchange Commission's Golden Apple Oil & Gas Inc. pump-and-dump case. In an answer filed on Oct. 30, 2009, Mr. Briner denies any wrongdoing, and seeks a trial by jury. The SEC claims that Mr. Briner and others caused Golden Apple to issue millions of shares in illegal offerings, and that they published false and misleading news releases touting the stock.

SEC's complaint

The SEC's complaint, filed on Sept. 1, 2009, in the Southern District of New York, identified the defendants as Mr. Briner and Jay Budd, of Toronto, Ont. The complaint also named a private company that Mr. Budd incorporated, Ethos Investments Inc.

The SEC claimed that Mr. Briner laid the initial groundwork for the scheme in the fall of 2004, when he carried out an illegal offering of five million shares of Golden Apple's predecessor, CDI Developments Inc. This gave him control of 100 per cent of the company's tradable stock. According to the complaint, he transferred 1.85 million of those shares to other individuals.

The company began trading on May 5, 2005. In the 12 days that followed, Mr. Briner and his associates carried out a series of trades that inflated the stock from five cents to 75 cents, the complaint stated. (All figures are in U.S. dollars.) The SEC said Mr. Briner placed the first order to buy the company's shares on May 5, when his associates were the only other shareholders. Much of the subsequent trading was between Mr. Briner and those that had received their shares from him, the complaint stated. The stock eventually reached a $3.70 high.

As the stock was rising, Mr. Budd issued a series of false and misleading news releases about the company, the SEC claimed. One, dated June 29, 2005, stated that the company would "continue to realize strong growth" from its business of providing home warranties. The SEC said Golden Apple had only sold one warranty at that point, an amount that fell 149 warranties short of its financial projections.

Another news release, dated Sept. 2, 2005, claimed that the company was in "an exciting position" to generate over $1-million in revenue in its first year. The SEC said that revenue projection also had no basis. The company premised it on having sold 400 warranties by September, 2005, but it had actually sold fewer than 10.

On Oct. 13, 2005, only six weeks after touting its growing revenue, the company changed its business to oil and gas. When it issued its financial results on Nov. 17, 2005, it stated that its revenue from inception was $3,384 and its net loss was $181,636.

The SEC claimed that the company then issued misleading news releases touting an oil and gas property. On Nov. 7 and Nov. 8, 2005, Golden Apple said that it had acquired a property in Canada, and it would be drilling it in the coming weeks. The company failed to disclose that it did not have the money or the permits to drill the ground, the complaint stated. The news releases also did not disclose that the company had to issue 30 million shares to acquire the property.

As it was publishing the news releases, the company was also issuing millions of shares in illegal offerings, the SEC said. According to the complaint, Mr. Briner and Mr. Budd drafted backdated promissory notes, which allowed them to issue free-trading shares to several entities. "Each of the fictitious notes contained name and dates that do not match either the corporate history of Golden Apple or the holder of the note," the complaint read.

The SEC also noted that none of the debt obligations appeared in the company's financial records. As a result of the issuances, the company's outstanding stock rose from 25 million to 57 million. The SEC said the company never disclosed the higher figure.

The SEC sought permanent injunctions preventing future violations of the U.S. Securities Act. It also sought disgorgement of profits, civil penalties, and director and officer bans for Mr. Briner and Mr. Budd.

Briner's answer

Mr. Briner filed his answer on Oct. 30, 2009. It mostly contains general denials. Mr. Briner admits to some routine things, such as being a resident of Vancouver, and denies the portions of the complaint that allege fraudulent acts.

He also states, without providing any details, that the complaint is barred for lack of personal jurisdiction, for improper venue and for failing to state a claim upon which relief can be granted. He asks that the judge dismiss the complaint and award him his costs incurred defending the case.

Briner's home

As with most complaints served on Vancouver promoters, the SEC had to document its method of delivering the lawsuit to Mr. Briner. In this case, it served him by courier, sending the complaint to his home in Surrey. The service papers list his address as a house in the Fraser Heights neighbourhood.

The home is also listed for sale. According to a realty listing, the 4,589-square-foot, six-year-old house is an "entertainer's dream." It has a pool, a movie room, a built-in plasma TV, a functioning wet bar, four bedrooms and four bathrooms. The asking price is $1.04-million. Government records show that Mr. Briner bought the home on Dec. 3, 2004, for $670,000.

Reader Comments - Comments are open and unmoderated, although libelous remarks, including names, may be deleted. Opinions expressed do not necessarily reflect the views of Stockwatch.
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And the SEC net tightens around yet ANOTHER scammer.

Best find a nice tropical island Briner and get there pronto, whilst yer still, temporarily, able. Canada has never failed to extradite a criminal and the US wants your type badly. Very badly.

Wonder if Urban Casavant is still on the run. That monkey will be spending the rest of his worthless life in a Nevada jail cell.

Too bad these two couldn't be bum pal cellmates for the next 30 years.

Posted by Run Briner Run @ 2009-11-03 14:53

Trial by jury? I'm sure that this matter might be convoluted enough to baffle a jury, but mightn't there be a bit of a risk travelling into the States?

Stockwatch Street Wires often reference Canadian promoters and insiders, charged by the SEC, who are in some sort of custody in the United States during the pretrial and trial process.

And "some sort of custody", in the case of Vancouver ex-lawyer, Martin Chambers, turned into a 15-year, in-jail sentence (according the the Vancouver Sun, in May, 2009, Chambers was still serving out his 15-year term).

Aweel, looking at the bright side, perhaps the news about the real estate listing will bring out more than the usual number of tire kickers?

Posted by halcrow @ 2009-11-03 15:13

Tis true these scam-a-doodles must manufacture good excuses when they feel travelling to the US might not be such a good idea any more... what with life in prison definately in the cards and all.

One Canuck scammer doodle has a mother that should have died 6 times over by now.

MeThinks the SEC finally got a court order on that un, offering free airfare AND a hotel room to boot. (Course the SIZE of the room and its location wasn't disclosed by the SEC - LoL)

Posted by My Mother is Sick @ 2009-11-03 15:45

I love when the idiots cant wait for a hearing to be over before they trash someone.More then likely they have no life and use their internet fantasies to guide them.

Posted by Fergus Morgansteiner @ 2009-11-03 16:30

Wont it be funny when Briner gets off.He can Subpoena the Stockwatch and get Run Briner Runs IP number and hunt his ass down.Little maggot probably has no assets to get.But if they turn him upside down they might get $1.34

Posted by Your IP Number @ 2009-11-03 16:47

BCSC is impotent and an embarassment! Let the SEC regulate our markets, too!

Posted by goLEEgo @ 2009-11-03 18:44

Briner will not show up. He is a crook and he is no good

Posted by stockman @ 2009-11-03 19:44

Methinks the Briner bum patting party best get quickly under cover before THEY become the next targets of the SEC.

Urban Casavants' minions crawled away whilst the crawling was good ... and thats sound advice for the Briner slithering assocate scammers too.

The days of criminal scum pretending to be legitimate are long over and Briner won't be the last to spend the rest of his life in a US prison.

Posted by Briner Bum Patters @ 2009-11-03 21:50

And lets be perfectly clear here.

Briner has had his fingers in many, many tar baby pies with this "Golden Apple" one amounst many.

The SEC crosshairs are firmly aimed and there will be no escape possible. Without question Mr. Briner will be facing significant jail time, probably decades, should he find the microscopic cajones to travel to the US as an innocent man to fight these multitude of capricious charges.

Good luck Mr. Briner, do you need help packing your bags? Many of your fans will gladly assist you I'm sure.

Posted by Briner Bum Patters @ 2009-11-03 22:22

When's the BCSC going to step up to the plate and admit the SEC is much more macho than they are?

Posted by Why No Y Chromosomes at the BCSC? @ 2009-11-04 06:49

Can you see the day when the lonely writters on stockwatch actually find a life.

Posted by Paul Johanson @ 2009-11-04 11:28

"Can you see the day when the lonely writters on stockwatch actually find a life. Posted by Paul Johanson @ 2009-11-04 11:28"

These guys kill me....LOL

You know the ones, the ones whose sense of reality about themselves is based on the assumption they are the only sane ones.

But seriously, regarding Briner, this one line telegraphs what he's in for "He asks that the judge dismiss the complaint and award him his costs incurred defending the case."

OoPs...kind of get the sense he's getting way ahead of himself. Most wrongfully accused or the innocent tend to be relieved and humbled the U.S. justice system vindicates them never mind thinking about the money. Seems money is all this guy thinks about ...and geeee...could this have been a driving force behind a pump-and-dump. Doubt the judge would miss that too.

Posted by TheStreet @ 2009-11-04 12:24

I have no clue WTF a "writter" is anyways.

Illiterte grade school drop outs (aka Briner bum patters) MIGHT be trying to say "writer".

Sure proves the point that there's a dead stupid sucker born every minue.

Posted by Duh me stooopid @ 2009-11-04 13:02

I bet Norm has told the authorities much about Briner and Jean Francois Amyot/Hilbroy Advisory Inc.'s involvement in hijacked pink sheet shells over the years.

Posted by Once a rat always a rat @ 2009-11-08 23:17

I do remember John(ny)to be a gifted musician. Perhaps he will have more time to spend composing music and playing his guitar after this is finished. I haven't seen much more about some of the other connected relatives and church friends since the WHA articles. Curious if it ends here for the Briner Group. Very sad though.

Posted by just wondering @ 2009-11-10 14:03

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