SEC Sues Site Operator, Alleges Nondisclosure

A California Web site operator failed to tell investors he was paid to promote two small-company stocks, the Securities and Exchange Commission said. In a civil complaint filed in federal court in Santa Ana, the SEC said Mark Malatesta made “glowing comments” on a site called Financial Solutions Web about two stocks without disclosing that the companies paid him a total of 5,000 shares. The companies, Entertainment Technologies & Programs Inc. of Houston and CasinoBuilders.com Inc. of Colorado Springs, Colo., weren’t charged with wrongdoing. Neither could be reached for comment. The SEC said Malatesta also made false claims, saying he managed more than $35 million in funds for the California State Teachers’ Retirement System and the California Public Employees’ Retirement System. Malatesta couldn’t be reached for comment. Entertainment Technologies’ business includes nightclubs on military bases. Its shares closed unchanged at 20 cents in over-the-counter trading. Shares of CasinoBuilders.com, which provides consulting and other services to gambling businesses, last traded Thursday, when they fell 6 cents to close at 10 cents in over-the-counter trading.