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by Mike Caswell

A federal judge in Florida has found Detroit's Benjamin Ballout and Egypt's Mohamed Zayed liable for the pump-and-dump of Enerkon Solar International Inc., an OTC Markets listing that claimed to have $320-million in supposed sales from a Canadian-made test for COVID-19. (All figures are in U.S. dollars.) The judge has found "uncontroverted evidence" that Mr. Ballout issued false and misleading public filings regarding the company's supposed $65-million in cash holdings, among other things. Mr. Zayed, meanwhile, fabricated documents and created a fake e-mail as part of a false promissory note, the judge has determined.

The findings are contained in a judgment handed down on Thursday, May 8, in federal court in West Palm Beach. The judge has not imposed any penalties on Mr. Ballout and Mr. Zayed, with the decision only finding the men liable for the scheme. The judge directed the SEC to file a motion setting out the penalties it is seeking.

The finding comes as part of a case in which the SEC cited the men for claims relating to a supposed quick COVID-19 test kit. According to the SEC, Mr. Ballout falsely claimed to have an order from an organization in the Dominican Republic for test kits, and issued a news release to that end. He continued touting the $28-million-a-month deal even after the Canadian distributor of the device told him that his news release was false and misleading, the SEC said.

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