When we ended The Mass Psychology of Suckers Part 1, we were examining the unique resume of SEFE (aka Midnight Candle) CFO, Patrick Deparini. At first glance he appears to be an odd choice as CFO. He had no real experience working in finance, nor in the candle business. His real job was as a paralegal at the law firm of Harold P. Gewerter, Esq. Ltd.
Harold Gewerter’s most famous client, John Edwards*, was mighty busy by the mid-00s. Not only was John the mastermind behind the CMKX fraud, but he was also behind Pinnacle Business Management (PBCM), US Canadian Minerals (UCAD), St. George Minerals (SGGM), BioTech Medics (BMCS), Global Diamond Exchange (GBDX), Equitable Mining (EQBM), OMDA Oil and Gas (OOAG), and Grand Entertainment & Music (GMSC). Read more in this excellent piece by Janice Shell, here, or go to Pacer, and read the entire USA v. Turino, Edwards, et. al. indictment of March 24, 2010.
So, perhaps some of John’s industriousness rubbed off on Patrick, for soon Patrick started his very own little shell company. In late 2004, young Patrick, then only 29, was listed as the CEO and majority shareholder of Las Vegas based Nascent Wine Company (NCTW) today a pink sheet stock that sells for less than 1/4 of a cent per share.
How did SEFE (fka MDCL) CEO, Helen C. Cary, sitting in Indio, CA and Patrick Deparini, in the offices of a sleazy law firm in Las Vegas, find one another?
The lawyer that is listed on the original SB-2 filing (see here) for NCTW was Wendy E. Miller. Wendy was not only an attorney at the firm of Harold P. Gewerter, Esq. Ltd., (see here) but she also represented Harold in the most recent SEC v CMKX case, filed in November of 2011.
The lawyer that is listed on the original SB-2 filing for MCDL (nka SEFE)? Wendy E. Miller yet again (check it out here). What a surprise!
First Gewerter‘s firm creates a shell, then they install one of their own as CFO, but now what? By the end of 2008, SEFE (fka MDCL) has still not generate a dime in revenues, and has only $272.00 in the bank. By the end of 2009, according to their 10K, the company still has no revenues and only $11 remains on the balance sheet.
Where is the money coming from to pay the ongoing costs of the shell? A 10Q filing, available here, for the quarter ended March 31, 2010 gives a clue, when it explains the $16k in Notes Payable on the balance sheet:
Represents numerous unsecured loans aggregating $16,535 from a non-affiliated third-party that loans the Company money on an as-needed basis. The notes are due on demand and bear no interest.
What non-affiliated third-party would ever loan money to a candle company, that has not had a penny in revenues since its formation almost 6 years prior, on an as-needed basis at no interest? Clearly something is up. And we will not have to wait long to find out…
*Edwards‘ wife Diana Lee Edwards (fka Diana Lee Flaherty) is also a felon, and a onetime fugitive from justice herself. She was involved in the Phoenix Metals USA II (PMTU) scam in the mid 90s. Read more about her and PMTU here and here.