AEHI charged with fraud
The US Securities and Exchange Commission (SEC) has brought fraud charges against Alternate Energy Holdings Inc (AEHI) and is seeking a court order to freeze the assets of the company and two of its senior executives.
The SEC has brought its case on the grounds that the Idaho-based would-be nuclear power company has fraudulently manipulated stock prices through misleading public statements and concealed profits reaped by CEO Donald Gillispie and senior vice president Jennifer Ransom. It notes that Gillispie has touted the company as a tremendous investment opportunity despite its having essentially no revenue and minimal operations. The fraud charges follow the SEC's temporary suspension of trading in AEHI securities because of concerns over the accuracy of information disseminated by the company.
"Documents we have obtained...indicate a scheme to personally enrich the CEO at the expense of investors"
Marc Fagel, Director of SEC's
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"In light of AEHI's ongoing efforts to raise funding while promoting itself through a daily deluge of press releases, we needed to take immediate action to get to the bottom of the company's misleading statements," said Marc Fagel, director of the SEC's office in San Francisco. Fruthermore, he added that documents obtained by the SEC suggested "a scheme to personally enrich the CEO at the expense of investors."
According to the SEC filing with a federal district court in Idaho, AEHI and Gillispie have raised millions of dollars from investors although the company "has no realistic possibility" of building a nuclear power plant. "AEHI has never had any revenue or profit," the document notes. The SEC alleges that since 2006 the defendants have engaged in a scheme using promoters and false press releases to pump up the price and volume of AEHI stock to artificially high levels before dumping the stock through secret sales. The SEC alleges that Gillispie had sold more than a million of his own shares through nominees and also knew that Jennifer Ransom had sold at least a million shares and hidden her stock sales from AEHI investors and the public, despite stating in press releases that no AEHI officer had ever sold stock. According to the SEC, Gillispie spent the money thus raised on "lavish personal expenses such as his Maserati sports car."
AEHI was set up by Gillispie in 2001 and taken public in 2006. Its self-avowed flagship project is to build a nuclear power plant in Idaho. However, SEC's filing of fraud charges notes that "despite pitching many business ventures that the company planned to pursue over the last four years…AEHI has no revenue and describes itself as a development stage company." Those projects, according to SEC, include harvesting lightning, developing fuel additives to reduce natural gas production costs by 40%, and using nuclear-powered desalination reactors to provide developing countries with clean water.
Researched and written
by World Nuclear News
