U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
, Civ. No. 101CV530 (N.D. Ohio, Eastern Div.);
On March 7, 2001, the Commission filed a Complaint in federal court,
Northern District of Ohio, Eastern Division, against Lloyd E.
Wollmershauser, also known as the "PennyStockMan," of Cleveland, Ohio,
for engaging in an Internet pump-and-dump scheme. The Complaint
alleges that Wollmershauser obtained over two million shares of
Thermotek International, Inc. ("TTKI"), a penny stock company that on
June 28, 2000 began trading for the first time in the over-the-counter
market, and then disseminated false information about the company,
causing the price of the stock to rise. Wollmershauser then sold TTKI
stock at a profit before the price of the stock plummeted.
According to the Complaint, Wollmershauser, the proprietor of an
Internet web site and newsletter service called PennyStockMan, touted
TTKI to PennyStockMan subscribers in his newsletters, on his web site,
and in personal e-mails, and made numerous false statements including
that he had inside information allowing him to project TTKI's price;
that the price of TTKI stock would likely rise to $20 by the end of
the first day of trading; that he believed TTKI was a good investment
based upon his independent research; that mutual funds were interested
in TTKI; and that he did not intend to sell his shares in the short
term. The Commission alleged that Wollmershauser, at the time of these
false statements, intended to sell his TTKI stock during any price
increase caused by his recommendation.
The Commission alleges that when PennyStockMan subscribers
demonstrated an interest in acquiring TTKI stock based on
Wollmershauser's recommendation, Wollmershauser advised them to place
limit buy orders at a specific price. The Commission further alleges
that Wollmershauser's false statements, coupled with his advice to
place limit buy orders, caused PennyStockMan subscribers to buy TTKI
stock on June 28 and June 29, 2000 which, in turn, caused the price of
TTKI stock to rise. The Commission also alleges that Wollmershauser
placed limit sell orders at the same time he knew that PennyStockMan
subscribers had placed limit buy orders. Finally, the Commission
alleges that Wollmershauser sold shares of TTKI stock on June 28 and
June 29, 2000 for proceeds of $436,660 before the price and volume of
TTKI stock plummeted.
Without admitting or denying the allegations in the Complaint,
Wollmershauser consented to the entry of an Order that (i) enjoins him
from violating Sections 5(a), 5(c) and 17(a) of the Securities Act of
1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule
10b-5 thereunder, and Sections 206(1) and 206(2) of the Investment
SNIPPETS:
U.S. SECURITIES AND EXCHANGE COMMISSION
Ohio, Eastern Div.);
The Complaint alleges that Wollmershauser obtained over two million shares of Thermotek
Wollmershauser then sold TTKI stock at a profit before the price of the stock plummeted.
According to the Complaint, Wollmershauser, the proprietor of an Internet web site and
his independent research; that mutual funds were interested in TTKI; and that he did not intend to
The Commission alleged that Wollmershauser, at the time of these false statements, intended
The Commission alleges that when PennyStockMan subscribers demonstrated an interest in
The Commission also alleges that Wollmershauser placed limit sell orders at the same time he
Finally, the Commission alleges that Wollmershauser sold shares of TTKI stock on June 28 and
Without admitting or denying the allegations in the Complaint, Wollmershauser consented to
tatements demonstrating his inability to pay.
In a related administrative proceeding, the Commission ordered TTKI and its president, Harold
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