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Infinium Labs haunted by SEC investigation

Following an SEC investigation into the financial dealings of Infinium Labs, former CEO Tim Roberts has been charged with fraudulently inflating company stock to fund the perpetually vaporous Phantom games console.

Following an SEC investigation into the financial dealings of Infinium Labs, former CEO Tim Roberts has been charged with fraudulently inflating company stock to fund the perpetually vaporous Phantom games console.

Kevin Bachus, who took over from Roberts as CEO last August (and has since been replaced by Greg Koler) initially played down the investigation last year, claiming "the SEC has concluded that Tim [Roberts] has done something wrong. We don't know what it was. I don't know if Tim even knows what it was."

According to the SEC, Roberts hired stock promoter Michael Pickens to send tens of thousands of faxes to investors across the US, falsely purporting that the Phantom games service would be guaranteed a successful launch in January 2005.

Stocks surged following the fax scam, the SEC alleging that Roberts then sold 1.3 million shares of his own stock in the company at the inflated rate, making USD 422,500 and issued several cheques for USD 100,000 from the company account to Mr Pickens. Additionally, the SEC alleges that Roberts paid Mr Pickens 4 million shares of restricted company stock.

The SEC is asking the US District Court in Orlando to force Roberts to surrender the proceeds of the scam, pay a civil penalty and be prohibited from participating in any offering of penny stock or serving as an officer or director of a public company.

Although Infinium Labs has disassociated with Roberts on a managerial level, the company's mysteriously intangible games-on-demand machine, the Phantom, has yet to make an appearance since a working prototype was displayed at the E3 convention in 2004. The company has secured additional funding from Golden Gate investors at the start of the year, and is reportedly working on the launch of its combined PC/mouse peripheral the Lapboard - another launch which so far, has yet to materialise.

Author

Paul Loughrey

Contributor