A Medallion Financial (NASDAQ: MFIN) investor is suing Murstein and several board members for failing to fulfill their fiduciary obligation to shareholders.
Defendants on the board include Hank Aaron, formerly a baseball hero and Lowell Weicker, the formerly respected Governor and Senator from Connecticut. Weicker was the first Republican senator to call for Nixon’s resignation before using his name to make a few bucks.
Sarah Frigo, fashion model cum investor relations expert, is also named in the action.
Among thousands of investors, the long-suffering, Murstein-screwed, MFIN stockholder brought the action against Murstein, his crony enablers and profiteers:
“…for breaches of fiduciary duties, unjust enrichment, aiding and abetting, and violations of law. These wrongs resulted in hundreds of millions of dollars in damages to Medallion’s reputation, goodwill, and standing in the business community. Moreover, these actions have exposed the Company to millions of dollars in potential liability for violations of section 17(b)of the Securities Act of 1933…SEC Rule 10b-5…”
“…Section 17(b) of the Securities Act makes it unlawful for any person to tout stocks for consideration without fully disclosing the consideration. Because defendant Frigo failed to disclose her compensation (and her identity), her articles and posts were materially misleading statements and she attempted to increase the Company’s share price, in violation of…SEC Rule 10(b)-5…”
The author of the filing is kind to cite as the first mention of Murstein’s security fraud, my November 18, 2016 blog post titled: “Jayme Stanley Outed as MF1N Tout”.
Post 2: Murstein Gets What’s Been Coming To Him For Years Of Committing Securities Fraud!!
However, my article resulted from a tip from “DeepResearch707” published two days earlier on November 16, 2016 in comment-73632260 cited in the link below. He is a very talented researcher and Seeking Alpha contributor.
Post 3: Murstein Gets What’s Been Coming To Him For Years Of Committing Securities Fraud!!
Readers also please note: a much, much more thorough article was published on February 6, 2017 by “Permabear”, also a talented and very articulate Seeking Alpha contributor. “Permabear” may or may not be the same person as “DeepResearch707”.
Post 4: Murstein Gets What’s Been Coming To Him For Years Of Committing Securities Fraud!!
The lawsuit specifically cites the Board’s failure to prevent Murstein from hiring Sarah Frigo, an inexperienced and uneducated fashion model, with no financial training or expertise, to pen putatively independent financial articles under a false name, and getting those articles placed in various online publications in an effort to promote the stock.
The content of Frigo’s articles, allegedly had to come from the company, given her lack of experience in the subject matter. Those articles suggested the very real problems plaguing the company’s operating and stock price performance were overblown, and the company, in turn, provided links on its website to the Frigo articles.
As noted above, promoting a company under false pretenses – using a pseudonym and implying expertise not actually present – without disclosing payment from the company itself, CONSTITUTES SECURITIES FRAUD, as is the company knowingly touting the misleading articles.
The lawsuit alleges the credibility of the company crashed when these facts came to light, exacerbating the very real problems posed by the emergence of Uber and Lyft, causing significant damages in the form of a falling stock price.
As extensively documented online since 2014, several other authors committed securities fraud in a conspiracy with Murstein, his profiteering cronies and others benefiting from the MFIN scam.
Members of the media, potential MFIN stockholder litigants and cowardly, willing-to-roll-over-witnesses (including Lawrence “Larry” Meyers) should contact Federal and State law enforcement and:
Thomas Amon Law
156 West 56th Street
New York, NY 10009