Josh Gross at Sports Illustrated reported last week that MMA manager Jason Genet has consented to final judgement in his case with the SEC over alleged “pump and dump” common stock maneuvers. Genet represents notable MMA fighters like Shane Carwin, Ben Henderson and Efrain Escudero.
The suit, filed last September in the U.S. District Court in the Eastern District of New York, alleged that from at least 2004 through 2006 Genet helped China Energy, a now defunct company, falsely obtain a listing on the Nasdaq National Market System; engage in unregistered distributions of securities; and enter into “secret arrangements to give away China Energy stock to persons who agreed to purchase China Energy stock in the market, and thereby created the false and misleading impression of active trading and interest in China Energy.”
Per the terms of the final judgment, Genet neither admitted nor denied the allegations. However he is required to pay a civil penalty of $130,000, disgorgement in the amount of $1.7 million (representing profits gained as a result of the conduct alleged in the complaint), plus interest to the tune of $697,745.57. Genet was also barred from participating in any offering of a penny stock for a period of five years.
Payout Perspective:
The “Pump and Dump” manipulation takes place when an individual or group of individuals distribute false or misleading information to make a stock appear more valuable (pump) than it truly is. Then once the stock price appreciates those responsible for the bad information immediately sell (dump) their shares on the market to claim their premium. Typically when all these new shares hit the market, supply outstrips demand and the stock price falls back down again.
Genet refuses to admit to any guilt, but the fact that he’s consented to pay disgorgement and penalties related to the case implies something very different. In fairness, this happened nearly five years ago – it’s possible that Genet has turned over a new leaf – but it’s still hard not to question whether he’s got the best interest of his fighters at heart after seeing something like this.
I hate to pile on even further, but I definitely wasn’t a big fan of how Shane Carwin’s camp handled the media leading up to UFC 116. Shane acted on poor advice in thinking that he had any sort leverage to demand the media visit and source his website for article information and quotes. He had the reputation of being a quiet, respectful and intelligent fighter, but often came off as disgruntled and sarcastic.
The opportunity to gain a new following, win or lose, was largely squandered; and, he probably didn’t help his standing with the UFC, either.
If Shane wanted to build his website as a source of information and social networking destination for fight fans, perhaps a better idea would have been to do as much media as possible (under his stated constraints with family, a second job, etc.), but swap the exclusive content for promotion of his website.
The great thing about the MMA community is that the network of blogs and fan sites has become a highly efficient distribution system; new and compelling content spreads like wild fire. Shane could have capitalized on this distribution to maximize the immediate exposure of his website; instead his camp tried to cut corners and send people to a site they’d really never heard of (and largely without a great reason to visit in the first place).
I don’t think you can blame Genet for this entirely, but it’s definitely something that a manager influences.
If someone really wants to get into something, they should investigate Genet’s mma advertising company that has ads all over mma blogs and sites… they have some HUGE accounts yet the websites are being paid pennies. It does not add up.
but then Genet goes on the UG and brags about how his ad company has more hits than anyone, how big it is, etc. something is fishy.
Off topic: the UFC just launched a beta for their website redesign. It looks good and provides a lot more competitive information on the fighters.
You could not be more wrong about Carwin and his handling of the media, like others you’ve jumped to false conclusion Shane was busy training and didn’t want any distractions before the fight. This wasn’t about him being mad about pay or anything else, it was about a guy being focused on being HW champion. And after the fight, his standing with the UFC couldn’t be highter the guy is guaranteed big money fights after his performance and the rematch could break records in the future the guy handled things almost perfectly.