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SEC Busts ‘Shell Packaging Firm’

MANHATTAN (CN) - The SEC on Monday sued a "shell packaging firm," which finds and sells public shell companies for use in reverse mergers, claiming it fabricated and backdated documents.

The SEC claims Joseph Meuse and his company Belmont Partners, both of Virginia, "fabricated and backdated documents used to convince a transfer agent and an attorney writing an opinion letter to issue free-trading shares of Alternative Green Technologies Inc. (AGTI). The SEC also charged AGTI and its CEO Mitchell Segal as well as Segal's business partner Howard Borg and stock promoters David Ryan, Vikram Khanna, and Panascope Capital Inc. for their roles in the scheme that resulted in unknowing investors purchasing fraudulently issued AGTI shares without the protections afforded by the securities laws," the SEC said in announcing its lawsuit.

"These shell packagers not only sold the shell company, but created the false documents necessary to cause the transfer agent to issue shares that should never have been sold to the public," the SEC's Associate Director of the New York Regional Office David Rosenfeld said in the statement.

Khanna and Panascope Capital agreed to pay $81,770 to settle the charges, and Borg agreed to pay $35,264, the SEC said.

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