Citron reports on Horiyoshi Worldwide (OTCBB: HHWW)


Not only is this promotion a scam — it is not even a good scam

Just when you thought old school stock promotion was dead, along comes Horiyoshi Worldwide. An intensely promoted bulletin board shell hits the street, generating millions in volume as promoters roll a shell deal into a near-bankrupt Japanese clothing outfit with virtually no business record, yet it has a market cap of more than $190 million

Before we get into the promotion, we will just present the numbers from their most recent 8-K which are completely ludicrous that this would even be a public company.

“We had nominal revenues of $30,633 for the year ended December 31, 2009 and revenues of $153,087 for the six months ended June 30, 2010. As at June 30, 2010 we had incurred a cumulative net loss of $376,306, had cash of $233,462, and a working capital deficit of $3,690”

“As of June 30, 2010, our total assets were $624,650 and our total liabilities were $1,000,182 and we had a working capital deficit of $35,532. Our financial statements report a net loss of $135,242 for the six month period ended June 30, 2010.”

C’mon promoters, if you are going to sucker the public, at least make it a decent story.  To show the extent of the promotion we look at this disclaimer.

“A third party has spent $2 million on this stock promotion.” 

That is more than the company’s entire budget for next year.

As  pulled from the 8-K:

Over the next 12 months we anticipate that we will incur the following operating expenses:

Design and Production Expenses


Marketing and Sales Expenses


General and Administrative Expenses (includes administrative and professional fees)


Total $1,350,000

Most recently, the company has disclosed that they have “raised money” from a Milan investment firm named Zyndy Trade Corp.  Yet, much like the promotion, which is being funded by unnamed third parties, a simple Google search shows us nothing on this investment firm and they do not disclose any names behind it.

So who is in charge here?

The CFO and Secretary of HHWW is Ray Catroppa.  Who is he?  The bio in the filings states he is a CFA and has a background with well-known wall IB firms on the street.

“Mr. Catroppa has an extensive background in capital markets and financial analysis that comes from the 25 years he spent with top Wall Street firms in New York City, including Credit Suisse First Boston (CSFB), First Manhattan Corporation and Neuberger Berman. For the past 6 years, Mr. Catroppa has worked as an independent consultant and advisor to numerous public companies listed on the NYSE and AMEX. In 2002, he received the designation of Chartered Financial Analyst (CFA) from the CFA Institute. He holds a B.A. in Economics from Stony Brook University and an M.B.A. from Fordham University in New York City.”

Why doesn’t it state that he is an investor relations guy with Cameron & Associates?

His main client, with over 20 PR’s in the last two years, is a 15c oil and gas deal traded on Canadian exchanges.

Promotion and spam everywhere

And what would you expect from a CFO who is an investor relations guy, except a MASSIVE stock promotion that has blitzed the internet?  Here is just a sampling of the nonsense:

(Breakaway Stocks)  Disclaimer:  CFM has received and managed a total production budget of $2 million for this advertising effort….

Halt material

Are these guys even aware this statement alone is Halt Material?

“Horiyoshi Worldwide (HHWW) shares could soar 4,538% or more before the New Year!

Of all the bizarre things the SEC tolerates, unfounded profit projections are at the bottom of the list.  If this statement were true at current prices, this worthless company would have to have a market cap of over $8.7 billion! Hello?


Just when you thought old school stock promo was dead…here you go.  The claims made in these promotional pieces are nothing short of fraudulent.  Does this SEC get to this stock sooner or later?

For everyone who buys based on email spams, it is most important to use SEC filings, that is why they are there.  Caveat Emptor!

Cautious Investing to All