International criminals increasingly use the Australian stock exchange to perpetrate revaluation frauds, creating phantom collateral they can borrow against, with the loan proceeds used for further fraud. Most recently, Singaporean criminals backdoor listed LionHub Group Limited (LHB.AX) on the ASX, taking over a dormant shell company in order to create a fake "market" price. After various sham related party transactions and a fraudulent capital raising, LionHub now has 757m shares outstanding and $6.5m cash in the bank. Although LionHub issued less than 5% of shares in the capital raising, the issue price of $0.20 implied a "market" value of $151m for the company.
Magically, the $6.5m in cash has been revalued to a $151m ASX-listed asset, guaranteed by ASIC to be unmanipulated. This fraudulent asset can then be used as collateral for debt, or be dumped on unwitting grannies by associated criminal fund managers. The top 20 shareholders own 95% of LHB, and after reinstatement to listing on June 12 the share price will be controlled by this cartel, creating a fake "market" value.
Shell companies for revaluation frauds are openly marketed in Australia by criminal enterprises such as Wholesale Investors, which also offer to ramp share prices and supply local sham directors and company secretaries. LionHub has connections to Sino Australia Oil & Gas (SAO.AX) and other related party frauds, sharing the same criminal associates. These manipulated frauds follow the standard pattern of long-term shareholder value destruction interspersed with sharp ramps engineered to benefit insiders.
ASIC and media alike regard the fraudulent ramps as magical market mysteries, enigmatic and wonderful occurrences for which there just can be no explanation. New revaluation fraud Fifth Element Resources (FTH.AX) issued 21m shares at $0.20 in a fraudulent capital raising, after which the share price was ramped to $0.95 in a month. Prior to the capital raising and ramp, an insider had purchased 20m shares at $0.01.
According to ASIC, this is not a ramp and FTH is not an openly manipulated share, because if it were ASIC would have done something. According to ASIC, this is all just a magical market mystery, and so ASIC lets it continue trading freely and attract more victims.