CYNK Technology rises as much as 36,000% in a month but is now suspended from trading

The US Securities and Exchange Commission (SEC)  has finally suspended trading in an obscure company called CYNK Technology today. CYNK has risen an astounding 36,000% at one point since mid-June this year on hype and media speculation making it a $6 billion company at its peak share price. 36,000% is pretty special by any metric and it almost seems like a joke. But it’s true and yet the fundamentals seem to be totally lacking – a hot air balloon if you ever saw one!

The SEC has suspended trading in CYNK until July 24, ” because of concerns regarding the accuracy and adequacy of information in the marketplace and potentially manipulative transactions in CYNK’s common stock.  The Commission cautions brokers, dealers, shareholders, and prospective purchasers that they should carefully consider the foregoing information along with all other currently available information and any information subsequently issued by the company. “

The social media and celebrity networking company has had many scratching their heads with apparently only one employee, no revenues and few assets. The huge surge in the share price from $0.06 per share on June 17^th to over $21.95 yesterday appears to be based on pure speculation. The shares fell over 1/3 later in the day to finish at $14.71 after trading as low as $9.80, valuing the company at $4 billion.  The company’s accounts show that it had no revenues from May 2008 when it started until the end of September 2013, with zero assets and an accumulated loss over the five-year period of $1.5m.

The company was founded in 2008 as Introbuzz. It first issued shares through public markets in 2012 under the name Introbuzz. Cynk’s main business is a website called introbiz.com, which markets itself as somewhere to ‘buy and sell the ability to socially connect to individuals such as celebrities, business owners, and talented IT professionals’. In SEC filings, Cynk described itself as a ‘development stage company’ asking users to pay for introductions to new contacts. Yet the celebrity network, introbiz.com does not appear to be functional.

In April 2013 the company reported that Kenneth Carter had resigned as the company’s CEO, President, Treasurer and as a Director. About a month later, Marlon Luis Sanchez was elected to the board of directors and, the next day, was appointed CEO, Secretary and Treasurer with over 72% of the company’s shares.  Sanchez has been a partner in Sanchez Medical Services, a company the “provides comprehensive medical services to the southern California market,” and Sanchez Medical Services has a division “dedicated to the ever growing medical tourism industry.” He is also primary spokesperson for the Medical Tourism Industry counsel in Tijuana, Mexico.

The company changed its name to CYNK Technology Corp in June 2013 and had a 1-to-75 stock split.

A surge of interest in CYNK on Twitter and other social networks seems to have triggered a stampede of buying in recent weeks on nothing more than froth. It seems likely that buyers late in the game will get very little back when the shares comes back from suspension if they ever do. Almost like a Ponzi scheme, someone was left carrying the can when the music stopped! Still it would have been nice buying the shares at 6 cents and dumping them this week before the collapse!

Contrarian Investor UK

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