SEATTLE (CN) - CellCyte Genetics defrauded the public by claiming that its stem-cell technology had been proven successful and was headed for human trials, the SEC claims in Federal Court. The bogus news drove the CellCyte share price to $7.50 before it sank to less than a dime, said the SEC, which also charged CellCyte's CEO Gary Reys and its chief scientific officer Ronald Berninger.
CellCyte :merely had a license for a very early stage technology and had no reasonable basis for its claims," the SEC said in a statement announcing its two federal complaints: one against CellCyte and Berninger, and one against Reys.
Berninger, 53, of Mukilteo, a co-founder of the company, approved or participated in drafting many of the false and misleading statements, and Reys, 64, of Freeland, approved the company's fraudulent SEC filings, the agency says.
The SEC also charged Reys with concealing CellCyte's role in the spam campaign that pushed the stock by announcing the bogus science, and with lying about his employment history.
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