BOCA RATON, Fla., July 21, 2011 (GLOBE NEWSWIRE) -- The Florida firm of Vianale & Vianale LLP filed a securities fraud class action lawsuit on July 18, 2011 in Fort Lauderdale, Florida federal court against Magnum d'Or Resources, Inc. ("Magnum") (Pink Sheets:MDOR) on behalf of purchasers of Magnum stock between July 2, 2008 and April 13, 2010, inclusive (the "Class Period").
The Complaint alleges Magnum, a tire-recycling company, cashed in on an illicit round-tripping scheme using its own stock. According to the Complaint, Magnum issued millions of shares of its stock as compensation to several so-called "consultants," who then sold the shares in foreign brokerage accounts, kept some of the cash proceeds for themselves, and funneled the rest – some $7 million – back to Magnum, under sham "loan" agreements. Magnum artificially juiced the scheme by falsely touting $130 million in contracts for its products and $15 million in financing – falsehoods that pumped up Magnum's stock price during the Class Period. Eventually the SEC began investigating Magnum's fraudulent round-tripping scheme, a fact Magnum hid from its outside auditors and the public for six months. In April 2010, when Magnum finally told its auditor, Weinberg & Company, P.A., about the SEC's formal investigation, the auditor withdrew its prior audit opinions for 2008 and 2009. Magnum's stock price plunged on the news. The SEC formally charged Magnum and its former CEO Joseph Glusic ("Glusic"). Glusic resigned from Magnum and has settled with the SEC.
The class action Complaint asserts violations of Sections 10(b) and 20(a) of the Securities Exchange Act, 15 U.S.C. §§ 78j(b) and 78t(a), and SEC Rule 10b-5, 17 C.F.R. § 240.10b-5. The case number of the class action is 11-CV-61591-DLG (S.D. Fla.).
If you purchased shares of Magnum common stock during the Class Period, you have until September 16, 2011 to ask the Court to appoint you as Lead Plaintiff, a representative of the proposed class. If you want to discuss your legal rights, at no cost and without obligation, please contact Kenneth J. Vianale at Vianale & Vianale LLP (Phone: 561-392-4750; E-mail: kvianale@vianalelaw.com).
Vianale & Vianale LLP has extensive experience litigating shareholder class actions of this type, and has recovered millions in damages for shareholders.