When we left Horiyoshi Worldwide Inc. in January, its share price was poised for a dramatic breakout. Or at least that’s what U.S newsletter writer Eric Dickson wanted us to believe.
“Shares In This Company Could Explode By 4,538% Before Spring of 2011!” he trumpeted in his newsletter, Breakaway Stocks.
“Don’t let another moment pass by without either calling your broker or logging on to your online trading account and getting into HHWW now, before news of their highly anticipated new street wear line hits the wires.”
At the time, Horiyoshi shares, which are quoted on the OTC Bulletin Board, were trading at about $1.60. To meet Dickson’s target, the stock would have to soar to more than $70. Alas, it has gone in exactly the opposite direction and is now trading at 45 cents.
Horiyoshi started as a Surrey-based exploration company called Kranti Resources Inc. Its directors were Benny H. Gill, Karnpal Grewal and Aaron Lessing. Gill and Grewal were partners in Canam Currency Exchange Ltd. in Surrey, and Lessing practises family law in Surrey.
It didn’t look like they were serious about exploring for gold. The more likely purpose was to set up a tightly held shell company for some future penny stock promotion. That promotion turned out to be Horiyoshi, which was selling expensive designer clothes for the Hollywood set.
Dickson’s tout sheet was just one part of a $3.6-million stock promotion campaign financed by a private company called Lux Media Corp., whose beneficial owners have never been disclosed.
“If history repeats itself, the fervour for this stock will soon die, the stock will crumble, public investors will be holding worthless paper, and another made-in-Vancouver stock market fiasco will have passed unimpeded through the kid-glove gauntlet of our securities regulators,” I predicted in my January column.
This sparked a series of angry emails from naive people who had drunk the Kool-Aid and were convinced that Horiyoshi would become a smashing commercial success.
Taylor Carmichael, who claimed he was neither long nor short the stock, pointed to the fashion line and said: “You think that’s a fraud? Wake up. You were manipulated [by short sellers].”
Laverne Catanzarite, who was long the stock, pointed to the fact that her daughter, a lawyer in Chicago, loved the “poncho Kate Hudson was seeing wearing. Blake in Chicago was sold out and she had her assistant search for it. Ended up ordering it from Brown’s in London!... I suggest you stick to fake mining companies as it is clear you know nothing about the high-end fashion business.”
To date, however, sales have been lacklustre. During the year ending Dec. 31, total sales were just under $500,000 and the net loss was nearly $600,000.
Gill and Grewal left the company when it morphed into Horiyoshi, and their currency trading company was dissolved in March 2009. I have no idea what they are doing now.
Lessing is still practicing law, but he’s in trouble with his professional association. Last October, the B.C. Law Society cited him for making “rude, unprofessional and disrespectful” remarks about an opposing party in a letter.
Last month, he was cited again, this time for failing to advise the society about a series of unsatisfied financial judgments against him, and how he intended to deal with them.
They include two income tax bills for $62,490 and $13,938 filed in Federal Court of Canada, two B.C. Supreme Court judgments for $42,536 and $60,000, and several other certified debts.
Neither case has been resolved yet.
dbaines@vancouversun.com