JOHN L. SMITH: Diamonds boondoggle a testament to the power of public relations - News

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Apr. 09, 2008
Copyright © Las Vegas Review-Journal

JOHN L. SMITH: Diamonds boondoggle a testament to the power of public relations

JOHN L. SMITH
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Urban Casavant has received news that not even he can spin into a positive press release.

The high-rolling front man of the Las Vegas-based CMKM Diamonds boondoggle and 13 of his colleagues have been hit with a civil injunction alleging they illegally issued and sold up to 662 billion shares of unrestricted stock and collected at least $64.2 million from investors who bought their story about the vast diamond fortune lying beneath the surface in far reaches of Saskatchewan, Canada.

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The government alleges the proceeds generated from January 2003 to May 2005 were largely split between Casavant, who got $31.5 million, and the "scheme's mastermind," John Edwards, who got $26.4 million. The rest of the cash filtered down to various paperhangers, brokers and phone sales jockeys.

Casavant's diamond empire was initially run out of his home, where he generated a steady stream of press releases touting the promise of the vast deposits in the Canadian wilderness.

Like all good cons, there was a grain of truth to the promotional puffery. The behemoth DeBeers corporation has explored the Forte a la Corne region of Saskatchewan, which is believed to contain one of the larger diamond fields on the planet.

Not that Casavant found any, or used the millions his promotion generated to develop his claims. But he wisely left such details out of his dizzily optimistic media statements.

Meanwhile, our man Urban mostly stayed warm in Las Vegas, where he was known as a big casino customer and a promoter of the CMKM Racing team. From top-fuel dragsters to high-powered auto racers, Casavant ran fast and used the machines to market his stock. He even loaned a vehicle to weekend racing enthusiast and Nevada Secretary of State Dean Heller. Now a congressman, Heller distanced himself from the CMKM crowd several years ago.

Casino sources say Casavant made little secret of his big diamond promotion. For the record, I wouldn't for a moment suggest the Gaming Control Board step up and question how much Strip casino officials knew about Casavant's scam despite the press and SEC scrutiny. Our gaming moguls need all the good customers they can get these days.

Casavant's company is a testament to the power of public relations. With press releases, hyperbolic Internet chat rooms, and race event promotions across the country, he attracted more than 40,000 investors.

His glittering press releases not only promoted his worthless stock, but they also helped calm the fears of skeptical investors as they downplayed the SEC's criticism. And that often meant investors eventually poured good money after bad as they chased their dream of riches glittering from the Great White North like some penny stock aurora borealis.

They didn't, however, take a shine to my reporting. I long ago lost count of the number of CMKM investors who called to rip me to pieces after reading a column that dared to call into question Casavant's motives. And executives at Silver State Bank weren't too pleased when it was reported that millions floated through more than 100 accounts linked to Casavant.

As the SEC gathered evidence and began isolating the company, eventually suspending it, the calls of complaint slowed to a trickle.

Now the SEC has taken the next step. In addition to Casavant and Edwards, attorney Brian Dvorak, First Global Stock Transfer owner Helen Bagley, Kathleen Tomasso, Anthony Tomasso, James Kinney, Ginger Gutierrez, Anthony Santos, Sergei Rumyantsev, and Daryl Anderson also were named in the complaint.

Santos, Rumyantsev, and Anderson were employed at NevWest Securities Corp. They allegedly generated millions in sales, but I guess NevWest forgot to pay its phone bill. Its number has been disconnected.

CMKM's Pecos Road "home office" is closed, too. Casavant has supposedly returned to Canada, perhaps to be closer to his diamonds.

The Tomassos' reputation as Boca Raton, Fla., paperhangers is so well established they rate their own page on the Ripoff Report Web site. They helped promote and sell CMKM stock in a city known as a scammer's paradise. Attempts to reach the Tomassos via phone also were unsuccessful. You guessed it: The number is no longer in service.

I'd like to think we've heard the last of the CMKM Diamonds scam, but here's a twist the company's glittering impresario might appreciate.

After all these years, the SEC is writing press releases about Urban Casavant.

John L. Smith's column appears Sunday, Tuesday, Wednesday and Friday. E-mail him at Smith@reviewjournal.com or call (702) 383-0295.

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Please enter your name Name: Please enter your email Email: Please enter a comment COMMENTS : (word count limit is 300) You have reached the maximum number of words allowed Current Word Count: Note: Comments made by reporters and editors of the Las Vegas Review-Journal are presented with a yellow background. nufced wrote on June 28, 2009 11:57 AM: Turino,C Jensen,Barnett Scams Read nutced poster on the link below, who pulls up the curtain so you can see the real stock criminals. http://ragingbull.quote.com/mboard/boards.cgi?board=SRCI&for=SRCI http://ragingbull.quote.com/mboard/boards.cgi?board=SRCI&read=1183074 zblmw wrote on September 03, 2008 11:21 PM: Jewelry Union Network Chinese jewellery Union Network (zblmw.com) is a provider for China and for global Chinese communities jewellery leading online media and value-added information service provider. China's jewelry site has a number of areas of the site to Greater China and overseas Chinese enterprises and the responsibility of jewellery, for the majority of Internet users through enterprise and government customers network media and entertainment, pay value-added online / wireless value-added services and e-government Solutions, and a number of services. Professional jewelry portal - the site of jewellery is expected in 2008 on a global scale more than 5 million registered users, page views, to 80 million, the highest break, will become the Chinese mainland and global Chinese communities in the Internet industry's most respected brands. Highly effective integrated marketing services - by virtue of leading technology and quality services, Chinese jewellery website will be welcomed by the majority of Internet users and can enjoy a high reputation. http://www.zblmw.com Stormgrey wrote on May 11, 2008 04:38 AM: John, in the interest of fair reporting, why would an "alleged" professional such as yourself appear to be taking this story so personal? What ever happened to fair and unbiased reporting? Sorry pal, you've just lost all credibility with many... cmkx broke wrote on April 16, 2008 07:33 PM: Lee Webb from stockwatch was right. Shame on Harold Engel aka willywizard who promoted this and accadacca in his paltalk room. Harold Engel aka willywizard also had some SEC fraud charges not long ago for another similiar scam. Joe English wrote on April 11, 2008 01:51 AM: John, what the dilly O with Dr. Rodger Glenn from the prestegious law firm of Edwards and Angels writing opinion letters flooding the market with over 300 billion shares of CMKX long after the investigation began.. Sup wid dat homey? Help a brudda out and git hold of these big boys and axe em a few questions.. Put down the gerbil now and git!! Joe English wrote on April 11, 2008 01:44 AM: John, keep your pencil sharp... privy wrote on April 09, 2008 05:09 PM: Las Vegas-based CMKM Diamonds boondoggle - words of advice, if they're selling something in Las Vegas Run Forest Run ALLEGED Comment wrote on April 09, 2008 04:30 PM: CMKX The case of the greatest "counterfeit shares." fraud in the UNITED STATES . Subject: File No. S7-08-08 From: THOMAS THORTON, Sir Affiliation: Bear Stearns Bond holderMarch 24, 2008 My Fellow Americans and Global Investment Community. The case of the greatest "counterfeit shares." fraud in the UNITED STATES is in my opinion CMKX. CMKX DIAMONDS, THE LARGEST NAKED SHORTED STOCK IN THE HISTORY OF THE UNITED STATES/WORLD" Trillions of stock shares traded and changed hands UNTIL CMKX revoked itself and had every stock holder pull stock certifcates out of brokerages out of street name and into Investors name to safely hold in their possesion. CMKX is also the LARGEST STOCK CERTIFICATE PULL IN THE HISTORY OF THE UNITED STATES" I Hope the the SEC did not create a regulational rule during this period the above action was commited to absolve them from liability of cmkx "counterfeit shares." from this company or anyother company that used this tactic to steal from all markets. This naked shorting fraud rule be passed without a second to lose. Naked shorts in the United States: "counterfeit shares." ALLEGED. LOL The Securities and Exchange Commission has charged three companies and 11 people in an alleged scheme to illegally issue and sell penny stocks "in a purported diamond and gold mining company." Through this activity, the defendants obtained more than $64 million from tens of thousands of investors across the country, the SEC says. HU wrote on April 09, 2008 04:22 PM: Why would anyone trust you? karl wrote on April 09, 2008 04:18 PM: Have you thought about interviewing Bob Maheu about his take on all this CMKM stuff? Read All Comments