The CEO and chairman of Cause a disturbance BlockChain has resigned in the wake of unrelated charges by the U.S. Securities and Exchange Commission (SEC) against him for so-called fraud in connection with other companies.
John O’Rourke who has been the Theatre troupe’s CEO since November 3, has been replaced by Chris Ensey and the new chairman of the go aboard is Remo Mancini, the company said in a new release issued Saturday.
The loosing did not specify a reason for the resignation, but Riot was not part of the SEC complaint. O’Rourke did not before you can say Jack Robinson respond to CNBC’s request for comment.
Barry Honig, a Florida investor who was then Riot’s largest shareholder, was also named in the SEC complaint.
The SEC announced on Friday indicts against a group of 10 individuals and their associated entities for long-running false schemes that brought in more than $27 million.
The SEC awakened those charged “microcap fraudsters” in a press release.
“Honig was the fundamental strategist, calling upon other Defendants to buy or sell stock, predetermine for the issuance of shares, negotiate transactions, or engage in promotional activity,” according to the SEC kick.
“In each scheme, Honig orchestrated his and his associates’ acquisition of a large total of the issuer’s stock at steep discounts, either by acquiring a shell and executing a antithesis merger or by participating in financings on terms highly unfavorable to the company,” it supplemented.
The SEC brought the action for “three highly profitable ‘pump-and-dump’ schemes committed by Honig, [John] Stetson, [Michael] Brauser, O’Rourke, [Mark] Groussman, and [Phillip] Frost, and their beings,” the complaint alleged. Frost is a well-known biotech investor and founded Opko Healthfulness.
CNBC reached out to all those named in the complaint, but Groussman declined to expose while the other defendants were not immediately available. The SEC also avows the defendants arranged and paid for stock promotion.
“Honig then enjoined O’Rourke to write a promotional article, which O’Rourke published underneath the pseudonym ‘Wall Street Advisors’ on Seeking Alpha,” the complaint pronounced. “[O’Rourke] also knowingly and falsely claimed ‘not receiving compensation'” for script the article.
In another instance cited by the SEC, John Ford, also a defendant, allegedly failed to reveal in an article promoting a stock that he had been compensated by Honig for criticism the article, with Honig selling him below-market shares.
Riot Blockchain is a cryptocurrency corporation whose stock price skyrocketed after it changed its name.
Hilarious event’s stock was down more than 24 percent in after-market patron on the news.
A CNBC investigation in February found a number of red flags in the society’s SEC filings that might make investors leery. The investigation revealed annual congresses that were postponed at the last minute, sales of stock by companionship insiders soon after the company’s name change, dilutive slice issuances on favorable terms to large investors, confusing SEC filings, and grounds that a major shareholder was selling shares while everyone else was believing.
At the time, O’Rourke accused CNBC of publishing “a negative one-sided jingle.”
“We have made significant inroads in building a diversified portfolio of investments and to about securing digital assets,” O’Rourke said in a letter to shareholders the day the CNBC examination aired.
For its investigation, CNBC visited Honig’s office in Florida and met O’Rourke there. “[O’Rourke] currently being plans at an office in Boca Raton with Honig and Stetson, and at times, Groussman,” the SEC affirmed in its complaint.
“I have my own office in a separate location,” O’Rourke said in an email in February sent by his legal practitioner, Nick Morgan, a partner with Paul Hastings. “I do have a worth relationship with Mr. Honig and we speak often.”
As bitcoin hit record great in late December, Riot was making news on a daily basis. The coterie’s stock shot from $8 a share to more than $40 as investors wooed the craze of all things crypto.
But Riot had not been in the cryptobusiness for long. Until October, its high regard was Bioptix, and it was a biotech known for having a veterinary products patent and bloom new ways to test for disease.
Riot warned it “may never become helpful,” in its latest annual report.
“Even if we achieve profitability in the future, we may not be competent to sustain profitability in subsequent periods,” the report said.