The Securities and Exchange Commission on August 15 halted trading in a stock that has zoomed to a value of $35 billion even though it has never had any sales and hasn't filed a financial report since 2014, when it reported on 2013. The stock is called Neuromama, Ltd., and the company, if there is one, is located in Playas de Rosarito in Baja California.
The SEC says that it wants to know "the persons in control of the company's operations and management, [and] false statements to company shareholders and/or potential investors."
There is no question about who is peddling this stock: Vladislav Steven Zubkis, who operated for years in San Diego, with the SEC and other law enforcement in hot pursuit. He says he is in charge of Neuromama marketing. The company's website includes a 68-page semi-mea culpa about his past. While he was in San Diego, he ran afoul of the SEC for pushing stock in a company named Stella Bella (supposedly in the coffee business) and International Brands through Z-3 Capital. Eventually, he was banned from the securities business. In 2005, the SEC seized his luxury yacht to help pay for a $21 million securities-fraud judgment.
He also spent five years in prison for putting out misleading information about a Vegas casino. I talked with him on the phone recently. He is still an inveterate name-dropper. He is proud that he did time in the same Pleasanton prison facility that once had been home to Mike Milken, the junk-bond king.
I asked Zubkis why he is only marketing head of this Mexican company. He is banned from being an officer of any company, he replied, and can't re-enter the United States. He blames "The Gestapo activities of the Immigration and Naturalization Service." Neuromama is a "pre-revenue stage" company, which means it has had no sales. He admits the last financial report was for 2013. The stock trades on the Pink Sheets, which really should be known as the Wild West. Pink Sheet stocks have no requirement to file financial records.
"The SEC is not doing its job," says Zubkis. "How come they didn't stop [trading] two years ago?" he asks. I asked how this Neuromama stock with no business can be valued by the market at $7.5 billion more than Delta Air Lines. "Demand and supply," he replies. There is great demand for this stock, despite Zubkis's reputation, he insists. (He now goes by the name Steven Schwartzbard, as well as Zubkis.)
In its one filing for 2013, Neuromama talked about its "dreams." It will have a casino in Ensenada by next year, and 38 of them by 2019. It will develop a product called "Neurozone" for connecting online retailers. It is developing "Neurofusion," which will create "clean, safe nuclear power." It will have revolutionary internet browsers and will have a children's foundation for "fighting these evils." The so-called evils are poorly run nuclear plants. The company is working on developing "a social network with a social conscience."
While he was in San Diego, the police were following Zubkis, suspecting him of activities with the Russian underground. Nothing ever came of that. But Zubkis is boiling mad at the San Diego police. His daughter was killed in a boat a year ago and "the police have no interest in the case," he laments.
"I should have written a book while I was in prison," he says.