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The 700,000 emails were sent at about 2:30 p.m. EDT on Feb. 23, 2012. The senders were AwesomePennyStocks.com and PennyStocksUniverse.com, a pair of affiliated stock promotion websites that touted penny stocks to potential investors.
The must-buy on this day was America West Resources Inc., a small coal-mining outfit headquartered in Salt Lake City, Utah. Its shares typically traded for about 29 cents each. The company seldom attracted much investor interest.
But Feb. 23, 2012, was different, according to documents filed last week by the United States Securities and Exchange Commission in a federal court in Manhattan. The America West promo was an alleged scam. Its mastermind: John Babikian, a 26-year-old Montrealer with multiple passports and whose whereabouts, at present, are unknown.
Mr. Babikian, a scourge among regulators, revenue collectors, investors and securities watchdogs, was, among stock promoters, something of a celebrity, albeit a mysterious one.
The young stock pusher fled Canada in 2012 after being charged with tax evasion. He is believed to possess passports from Guatemala, Lebanon and Nevis and was last reported — by his wife’s divorce lawyer — to be in Monaco.
His now-frozen U.S. assets include two houses, one in Los Angeles he reportedly purchased for $2.2-million, an agricultural property in Oregon and an ownership stake in a private airplane. His luxury car collection, meanwhile, consisted of a Bugatti Veyron — a million-dollar sports car capable of accelerating from zero to 96.6 km/h in 2.5 seconds — a Lamborghini and a Bentley. (Revenue Quebec previously obtained a court judgment to seize some of Mr. Babikian’s assets relating to a claim he owed them close to $5-million in unpaid taxes.)
Mr. Babikian got rich, authorities allege, by what is known in the business as pumping-and-dumping stocks. He was behind the websites and the 700,000 email push hyping America West.
That Feb. 23, 2012, electronic sales promotion triggered a trading frenzy around the obscure mining stock, pushing America West’s share price to $1.38 — an all-time high — within 90 minutes.
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