The Mass Psychology of Suckers Part 1 – Sefe, Inc. (SEFE)

Every once in a while someone will ask us here at BuyersStrike! about a small company that is, in our eyes, obviously a stock promotion. But to some it seems real. They want to believe it is real. And now is one of those times. Introducing SEFE, Inc. (SEFE), a company that hits new highs on increasing volume every single day. A company that today possesses a market cap of over $110mm, but at the end of 2011 had less than $6000.00 in the bank.

SEFE is also the newest client of Geoffrey Eiten‘s notorious stock pumping investor relations shop OTC Financial Network aka National Financial Communications, and Paul Cohen‘s ridiculous Grassroots Research aka Cohen Research. More on those two fine fellows in a bit, but first lets look at the origins of SEFE, Inc.

Sleepy Indio, California, most famous for the Coachella Valley Music Festival every spring, was also in 2005 the birthplace of SEFE. SEFE began life as a humble Nevada incorporated shell called Midnight Candle Company (MCDL). The sole officer, director, and 95.6% majority shareholder was Ms. Helen C. Carey. The company was being run out of a 1700 square foot condominium at 79013 Bayside Court in Indio. See it here.

A woman with the same name, and of the same age, shows up linked to several properties in the Phoenix/Scottsdale area of Arizona. Remember that.

In January 2006, shares of Midnight Candle were listed for trading on the Pink Sheets. By May 2008, enough time had passed to “season” the shell, and activity began. First Helen decided to do a 30 for 1 forward split of the stock, and to increase the amount of authorized shares to 200,000,000.

Then, sometime between May and July of 2008, a gentleman named Patrick Deparini linked up with Helen and became the CFO. According to his resume, Deparini went to school at the University of Nevada – Las Vegas in 1993, finally emerging with a B.S. in Finance in 1999. This genius took six years to get a degree from UNLV. One wonders who else was fighting for the rights to hire this wunderkind. Midnight Candle must have been lucky.

Or was it something else, different from luck? For Mr. Deparini’s resume shows lots of fascinating, overlapping work experience. From 2001 up until this very day Patrick has worked for the Nascent Group:

Nascent Group, Inc.

May 2001Present (11 years)

Nascent Group, Inc. is a boutique consulting services firm. We are a group of attorneys, CPAs and consultants that work hard to obtain results for our clients in both a timely and cost-effective manner. We are a full-service team with a great deal of experience and expertise in the following:

* Taking companies public
* Private and public securities offerings

In reality the Nascent Group is one of many reverse-merger schlock house located in Las Vegas. Check out their website here. At the same time that Patrick was working in the dirtiest part of the stock market at Nascent Group, he was also working as a lowly paralegal.

Paralegal

Law Offices of Harold P. Gewerter, Esq., Ltd.

20012004 (3 years)

Formed securities law and litigation division for the law firm.
• Provided regulatory and accounting services to clients.
• Marketed the firm’s services to attract clients and negotiated contract terms.
• Grew client base to over 100 companies across the US and Internationally.
• Communicated with FINRA, SEC and various State Securities Divisions.

Wow! If Patrick formed the securities law and litigation division, he must have been some amazing paralegal. Or is Patrick just buffing his resume a lot?

Gewerter has been practicing law since 1979, and his business appears to be almost entirely securities law and litigation. The Las Vegas law firm of Harold P. Gewerter is connected to many penny stocks, including two that seem to do nothing more than create and promote more reverse merger trash! Check out the website for Gerwerter’s Crown Equity Holdings (CRWE) a one and a half cent special, and under a penny pinksheeter Public Company Management Corp (PCMC). However, Harold is most well known for his role as John Edwards attorney in the CMKM Diamonds (CMKX) scam. Edwards was instrumental in putting the CKMX deal together in the first place. According to an article in the Las Vegas Review-Journal:

The scheme started when Edwards did a reverse merger between his public company, CMKM, and several private Canadian companies controlled by Urban Casavant, according to the order.

Casavant was chief executive and chairman of CMKM while Edwards, using the alias Ian McIntyre, was director of post-term matters.

The Las Vegas Review Journal has done a great job reporting on the CMKX fraud. Read more about it here, and more here, and in the New York Times, here and here.

CMKX was quite a phenomenon, although an obvious fraud its low share price and massive media attention created a large following of shareholders who were virtually cult-like. While likely accidental, the frequency and repetition of the CMKM Diamonds message, name, and ticker, would have made Goebbels proud. Many CMKX shareholders, like China Agritech (CAGC) shareholders, still have not accepted that they were scammed, check out this moron who still appears to believe that the SEC, the DTCC, and other actors secretly conspired to keep untold riches out of CMKX shareholders’ hands.

But enough for today. Let’s come back to Patrick, Midnight Candle, Geoff Eiten and SEFE very soon…

The content contained in this blog represents only the opinions of the author. The author may hold either long or short positions in securities of various companies discussed in the blog. This commentary in no way constitutes investment advice, and should never be relied on in making an investment decision, ever. This blog is not a solicitation of business: all inquiries will be ignored. The content herein is intended solely for the entertainment of the reader, and the author
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13 comments

  1. Yeah! Welcome back BuyersStrike! Can’t wait to see more from Vegas, and nice digging on Mr. Deparini. You’re right, seems like a catch.

  2. Hey BuyersStrike, great info. I actually just got a ten page “penny stock wizard” mailed to me on Sefe. Funny they are calling It the next coke or apple.

  3. The SEFE promotion pages can be seen at these websites:

    www. stocksdigest.com/stock-report/sefe/
    www. pennystockwizard.com/stock-report/sefe-02/
    www. stockspecialists.com/stock-report/sefe/index.php

    They are paying a ton of money to Google, Yahoo!, and Microsoft to get ads for SEFE placed highly (try searching ‘penny stocks’ or ‘stock’ on any of the search engines).

    [@Goodemi – Your comment was stuck in the spam queue. Our apologies, and good point about their use of SEO to keep only the tout sheets high in the results. SEFE promoters have been far more aggressive with SEO than others in the past. – Editor]

  4. My question is this: how can one who believes SEFE will return to a penny put on a trade? Can’t short .OB stock, right? So what to do except let the suckers go long?

  5. Speaking of questionable valuation: any thoughts on LQMT ? At a shallow dive, not as shady as most here at Buyersstiriek, but surging on word of Apple using their technology for the next iPhone case. 2011 rev was $1 million — market cap $90 million.

    1. [@The Captain – Your instincts on LQMT are spot on. There is nothing there. Apple bought a worldwide perpetual fully-paid-up license to their technology, LQMT will not be getting meaningful revenues from AAPL ever again. Further, the LQMT technology is nothing new. The company has been around for ages, floundering, since going public in 2002. LQMT’s balance sheet is atrocious. One can only assume they are hoping to sell stock to get money into the company. On the plus side, it is liquid, and it is borrowable. – Editor]

    2. these are tough times. you can’t believe ANYONE because a lot of these bloggers belong to “wolfpacks of short sellers”…and they destroy real companies all the time with slander,lies,rumors.like liquid metal. thyey DO have an allience with apple…we know this because apple uses their product in their smart cards…but i can’t tell you how many times i have read LQMT is a shell company with no sales…a lie by short sellers, but you see it every day… the key is doing extensive research. finding out the patent numbers and checking them out for instance…

      [@Michael – LQMT does not have an ALLIANCE with Apple, they have sold Apple a fully-paid perpetual license. Under the terms of the license agreement not only will they will never see meaningful revenues from Apple ever again, but the IP goes to Apple under certain circumstances. Don’t be a sucker. – Editor]

  6. You know it’s hard for some people to understand that their are laws inplace to protect shareholder’s from fraud. I cannot understand why some people think that nothing can be done about it!! All it takes is money and balls. I know for a fact that CMKM Diamonds traded as many as 92 Billion shares and 22 Billions shares in a day. The market traded mostly 6 to 8 Billion a day, as soon as I seen that I brought 30 Million shares, and a few days later I sold 8 Million shares and made almost $5000.00. If you trade stocks long enough you get a feel and a complete understanding to make your money and move out!!! I kept 26 Million shares because I know a lawsuite would someday come. Well lord and behold Al Hodges 7 years later… Folks we will be paid!! And the bad thing is, if an NDA comes down, then you will always know that this was a scam!!! And we will be in BORA BORA enjoying the cold drinks on my boat!!! Have a great day!!!

  7. Are you referring to Al Hodges or Steve Kirkpatrick as a “moron?”

    “…check out this moron who still appears to believe that the SEC, the DTCC, and other actors secretly conspired to keep untold riches out of CMKX shareholders’ hands.”

    [@CMKM Info – We are not going to turn this into a thread about CMKX, that story is well known, and our sincere belief is that anyone buying into the absurd consipiracy claims is a moron and/or suffering from massive cognitive dissonance. Read some of Leon Festiger’s works, it will help you understand the psychological issues at play in these situations, and if you can figure out the clue in the title of this post, read that book too. – Editor]

    1. You are preaching to the choir.

      I started three Petition Letters on change.org, wrote three articles for OpEdNews, filed a 166-page complaint with the SEC against Hodges the Skunk, and filed four complaints with the OIG against the SEC.

      Here is the link to my latest Petition Letter on change.org:

      http://www.change.org/petitions/steve-kirkpatrick-honor-your-promise-to-obtain-the-transaction-summary-for-cmkm-diamonds-inc

      Here is the link to my first article that was published on OpedNews on 11-24-11: “The SEC Learned Nothing from Madoff — Check Out CMKM Diamonds, inc., for Proof.”

      http://www.opednews.com/articles/1/The-SEC-Learned-Nothing-fr-by-CMKM-Information-111121-339.html.

      Here is part of my email to Captain Kirk (Steve Kirkpatrick) in which I talk about “cognitive dissonance.”

      Start of Email

      Dave Nelson posts tying the alleged fund to the World Global Settlements:

      It is time for a real investigation into this

      So there is one ongoing as I type, and the results will be sent out as a package. If it proves this was all bs I will just deal with it, but even though the investigation is only in its initial phase there is already mounting hard evidence of a massive conspiracy as outlined by Al Hodges! One fact is that Lindell Bonney has been retained by certain funds mentioned that have evidence the fed stole their money. They hired Bonney to get their money released, and Al Hodges letters say he represents Bonney. The head of one fund told more people than ever are working to get the World Global Settlements released.

      Given our authorities, ie FBI and RCMP, are like the sec, captured. I had to get one of their own who isn’t captured to do a real investigation. I will accept the result even if it proves I am a fool for wasting my time with cmkx.

      Let the chips fall.

      http://ragingbull.quote.com/mboard/boards.cgi?board=CMKI&read=1074749

      Dave Nelson is obviously setting himself up for disappointment for the umpteenth time. He attempts to mitigate the disappointment as evidenced by the following excerpts from his post:

      “I will accept the result even if it proves I am a fool for wasting my time with cmkx.”

      “Let the chips fall.”

      But Dave Nelson, CMKM’s number #1 poster boy for cognitive dissonance, will NOT “accept the result” and will NOT “Let the chips fall.”

      Like all good poster boys for cognitive dissonance, he will mitigate his discomfort when the obvious result (reality) fails to meet his expectations (fantasy) by rationalizing something like this: “Obama is holding things up. We have to wait until the election is over;” or “Al is awaiting for the approval of the ETs.”

      By the way, I am going to start my own blog in which I post all of my work — and that will be the fraudsters’ and the SEC’s worst nightmare.

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