From the Wall Street Journal:
A Social Network With No Members, but a $6 Billion Valuation
How can a social network that no one has ever heard of suddenly be valued at more than $6 billion?
That’s what is happening with the one-time penny stock, Cynk Technology, which is up more than 100-fold since mid-June, bringing its market capitalization to more than $6 billion on Thursday. Yet the self-proclaimed social network has no revenue, no product, no assets and one employee.
If it’s true that there’s a sucker is born every minute, then many of them trade on the penny-stock market. As The Wall Street Journal wrote this week, the world of penny stocks is “a historical haven for con men and hustlers that the FBI says is “rife with fraud.”
And their only employee - the CEO
Four chief executives since 2008. That’s a lot of chiefs for a company that isn’t up and running yet. The 10-K from May 2013 says John Kueber was the CEO from 2008 through October 2011 and then Kenneth Carter took over. A few months later, in the 10-Q, Marlon Luis Sanchez was listed as the CEO, having started in April 2013.
Who is Sanchez? According to a Cynk proxy filing, he is a partner in Sanchez Medical Services, which provides comprehensive medical services to the Southern California market. He is also the “primary spokesperson” for the Medical Tourism Industry council in Tijuana, Mexico. Not exactly a Mark Zuckerberg type.
Reached by phone Thursday, Sanchez said he left the company several months ago. “I worked my magic for a year, my friend, and now you can see the results,” he said, adding that he couldn’t speak further at this time.
UPDATE: A document from June reveals who replaced Sanchez at CEO: Javier Romero, whose address is listed in Belize City, Belize. The letter — from law offices of Harold P. Gerwerter, who writes that he signed off on Cynk’s latest disclosures — disclosed that Romero purchased 210 million shares from Sanchez in February. Those shares were worth more than $3.5 billion during trading on Thursday.
In response to an email from The Journal, Gewerter replied, “I no longer represent that company.” He wouldn’t grant an interview. In his June letter, he listed Romero’s address as Suite 400 in a Belize City business center. However, a staff member at the business center said there is no Suite 400.
As for Carter, Cynk said he is CEO of Blaque Technology, a “marketing, promotions, web building/trafficking, and entertainment casting company based in Las Vegas.”
Reached on Wednesday, Carter said he received many calls about the company’s stock climb and was surprised to discover his name is still on company documents. “I thought this was done,” he said. “I resigned.”
And the Pump-and-Dump starts in 3... 2...
