Thursday, February 3, 2011

AEHI Attorney: "This company is dying."

Posted By on Thu, Feb 3, 2011 at 1:36 PM

It was a fiery morning in courtroom No. 2 of Boise's federal courthouse. Lawyers are duking it out over allegations surrounding Alternate Energy Holdings Inc.

The Eagle-based company is accused of a "pump and dump" scheme, manipulating stock through false statements allowing key management to sell shares at inflated prices. AEHI recently got a green light from Payette County to proceed with its proposal to build a nuclear power generator outside of New Plymouth.

AEHI CEO Don Gillispie and Jennifer Ransom are the center of the firestorm. Who is Jennifer Ransom? Good question. The answer may sway Federal Judge Edward Lodge as he considers the Securities and Exchange Commission's action to freeze the assets of AEHI. According to the SEC, Ransom was senior vice president.

"She's not a line officer," said AEHI attorney Richard Roth. "She was really a vice president of administration. She had no day-to-day responsibilities."

Ransom has since become president of Energy Neutral, a subsidiary of AEHI. Affidavits indicate Ransom accompanied Gillispie on numerous trips to pitch the company to foreign investors. In fact, many of the trips were a highlight of today's testimony.

"Where do we begin," asked SEC attorney Mark Fickes. "How about Acapulco, the Bellagio in Vegas, a Colorado resort?"

Fickes said investor money was used for season tickets for sporting events, a Maserati and even a new home for Gillispie.

"The hard working people of Idaho don't deserve to see their investment money be used for these extravagances," said Fickes.

The SEC also said Ransom cashed out $180,000 in AEHI stock to pay Gillispie who had fronted money to buy a new home for Ransom's sister.

At the heart of the debate is the worth of AEHI shares. The SEC said that fraudulent press releases increased interest and "pumped" the stock nearly 900 percent in value. Since the allegations surfaced in December, AEHI has plummeted and all assets have been frozen.

"This company is dying," said Roth. "They have nothing to live on. Please your honor. Lift this freeze. Let them go back to work."

Lodge has ordered everyone back into the courtroom this afternoon.

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