UNITED STATES SECURITIES AND EXCHANGE COMMISSION
LITIGATION RELEASE NO. 16700 / September 14, 2000
SECURITIES AND EXCHANGE COMMISSION V. 1stBuy.com, Inc., and Roger D.
Pringle, Civil Action No. A-00-ca-599sf (USDC/WDTX/Austin)
SEC FILES LAWSUIT AGAINST AUSTIN, TEXAS
INTERNET RETAILER IN "PRE-IPO" STOCK SCHEME
The Securities and Exchange Commission announced that on September 14,
2000, it filed a civil lawsuit against 1stBuy.com, Inc. (1stBuy) and
its founder and CFO, Roger D. Pringle. The SECs action pertains to an
Internet stock offering conducted by 1stBuy during 1999 and early 2000
in which the company raised approximately $3.8 million from 1,200
investors nationwide. The stock offering was conducted pursuant to
Regulation A, or the "small issues" exemption, of the Securities Act
of 1933. The SECs complaint alleges that 1stBuy and Pringle played off
the recent Internet IPO frenzy by referring to the offering as a
"pre-IPO," and inducing investments through false and misleading
statements aboutthe timing of a purported IPO, the projected value of
its stock and the ability of the company to generate stockholder
returns. The SECs complaint further alleges that the 1stBuy offering
failed to meet the delivery and timing requirements of Regulation A in
violation of the registration provisions of the Securities Act.
The defendants are
* 1stBuy.com, Inc., a Texas corporation located in Austin, Texas,
that operates an Internet retail website, sometimes known as an
"e-mall"; and
* Roger D. Pringle, age 43, a resident of Austin, Texas, and 1stBuys
founder, CFO and a member of its board of directors.
The SEC alleges that in statements made on 1stBuys website and in
unsolicited e-mail messages, known as "spams," the defendants
described 1stBuys offering as a "pre-IPO" offering and claimed that an
IPO price range of $12 - $18 had already been set. The defendants
further projected that a $5,000 investment would grow 1,200% in just
one year and an additional 21,000% over the following three years. The
defendants also represented that after the conclusion of its small
business offering, 1stBuy would have a market capitalization of over
$28 million and would easily meet the listing requirements of the
NASDAQ small capitalization market.
In reality, the SEC claims, 1stBuy was rejected by the one brokerage
firm it approached about underwriting an IPO; the projected returns
had no basis in fact; the company failed to meet NASDAQ listing
SNIPPETS:
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
SEC FILES LAWSUIT AGAINST AUSTIN, TEXAS
The Securities and Exchange Commission announced that on September 14, 2000, it filed a civil
The SECs action pertains to an Internet stock offering conducted by 1stBuy during 1999 and
The SECs complaint alleges that 1stBuy and Pringle played off the recent Internet IPO frenzy
The SECs complaint further alleges that the 1stBuy offering failed to meet the delivery and
The SEC alleges that in statements made on 1stBuys website and in unsolicited e-mail
The defendants also represented that after the conclusion of its small business offering,
In reality, the SEC claims, 1stBuy was rejected by the one brokerage firm it approached about
The SEC also alleges that 1stBuy did not comply with the Regulation A small issues exemption,
When selling stock under the small issues exemption on the Internet, a company must provide
The SEC filed the civil action after 1stBuy failed to remedy problems identified by SEC staff
The SEC has recently charged three Internet companies with fraud for making false IPO claims.
Investors are encouraged to report suspicious Internet offerings via e-mail to.
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