PrepaYd, Inc. and Mr. Berman are currently under investigation by the California Department of Corporations and other Federal and State regulatory agencies for improper securities dealings. The charges being investigated by the CA DOC include:
1) Publishing false or misleading financial statements 2) Using improper methods of soliciting investors, and 3) Improperly compensating non-licensed equity salespeople. 4) Failure to act as a fiduciary Mr. Berman willfully and intentionally failed to disclose this investigation or the nature thereof, to the investors in PPDC, and Mr. Berman raised new investor money without disclosing this investigation or discussing the potentially negative impact that such an investigation would have on the Company. Mr. Berman also used significant amounts of investor's money to retain attorneys in this matter, but did not address this use of funds in the Use of Proceeds section of any Private Placement memorandum, including the private offerings that was ongoing during the initial phase of the DOC inquiry. |
The outcome of this matter could have an adverse effect in the company.
HENDERSON, Nev., July 16, 2012 /PRNewswire/ -- PrepaYd, Inc. (OTC-PINK: PPDC) announced today that an anonymous letter sent to some of its shareholders alerted the company. Because of the nature of the company and its subsidiaries businesses they routinely receive subpoenas from various police departments, various state agencies, the internal revenue service and other agencies which the company treats as routine and responds and cooperates fully with. Approximately a year ago the California Department of Corporations prepared a subpoena for certain books and records of the company. The company's securities counsel believed it was a routine investigation at the time and the company responded accordingly. A recent anonymous letter alerted the company to contact the DOC on this year-old matter. The company no longer believes this is a routine matter and will respond accordingly. The outcome of this matter could have an adverse effect in the company. Besides alerting the company the anonymous letter was meant to cause the company harm. The letter contained false and misleading allegations and information unknown at the time to the company. The anonymous letter has caused the company harm and the company intends to pursue all those responsible once the company believes it has sufficient evidence and the timing is right.PR Newswire (http://s.tt/1i4LG)
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