SEC Charges Investor Relations Firm and its Executives with Fraud, Registration Violations, and Acting as an Unregistered Broker-Dealer

Today the Securities and Exchange Commission ("Commission") filed a civil action in the U.S. District Court for the Middle District of Florida, alleging that investor relations firm Big Apple Consulting USA, Inc. ("Big Apple"), its wholly-owned subsidiary MJMM Investments, LLC ("MJMM"), and four of its executives-CEO Marc Jablon, vice president Matthew Maguire, MJMM president Mark Kaley, and Keith Jablon, vice president of another Big Apple subsidiary-made public misrepresentations and material omissions about the financial state of CyberKey Solutions, Inc., ("CyberKey") while the two entities sold hundreds of millions of CyberKey shares. These CyberKey shares were sold under no registration statement and no legitimate exemption from registration. The SEC also charged Big Apple and MJMM with acting as unregistered broker-dealers, and Marc Jablon, Maguire, and Kaley with aiding and abetting the two entities' violations in that respect.

According to the SEC's complaint, the Big Apple executives learned by August 8, 2006, that CyberKey's only significant source of revenue, a supposed $25 million purchase order from the U.S. Department of Homeland Security ("DHS"), could not be located by DHS itself and almost certainly did not exist. Despite this knowledge, the Big Apple team continued to promote CyberKey and its business relationship with DHS and sold hundreds of millions of CyberKey shares into the public market. In addition to planning and editing press releases, Big Apple used a telephone calling room of 14 to 50 callers to promote CyberKey stock, including the company's relationship with DHS, to registered brokers. In doing so, Big Apple and MJMM acted as dealers in connection with the distribution of CyberKey stock and as brokers by participating in securities transactions at key points in the chain of distribution of CyberKey shares.

The SEC's complaint charges each of the defendants with violations of Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act") and Rule 10b-5 thereunder, as well as with violations of Section 17(a) of the Securities Act of 1933 ("Securities Act"). The SEC's complaint also charges Big Apple, MJMM, Maguire and Marc Jablon with violating Sections 5(a) and 5(c) of the Securities Act. Finally, the complaint charges Big Apple and MJMM with violations of Section 15(a) of the Exchange Act and Marc Jablon, Maguire and Kaley with aiding and abetting the entities' violations of Section 15(a).