New Jersey Bureau of Securities Delivers $1.1 Million Penalty Against Extreme Energy Solutions

Extreme Energy Solutions, Inc., the purveyor of an emissions-reduction device for automobiles, and its president and CEO, Samuel K. Burlum have been ordered to pay a $1.1 million civil fine after it was found that the company engaged in “fraudulent sale of unregistered stock, warrants, and promissory notes, and misled investors through false statements and omissions of material fact,” according to the New Jersey Bureau of Securities.

The Bureau said Monday that its chief Laura Posner found that Burlum, who attracted potential investors through his membership to a group called Global Information Network -- described as a “unique success club” that helps other members achieve wealth -- and had them purchase stock and unregistered securities with the company based on false representations of the its value.

Among the claims was that the company was preparing for an initial public offering and that it had turned down a $300 million purchase offer.

“The Bureau of Securities Chief found that Burlum misled investors with a series of lies about his company’s current and future prospects for success,” Acting Attorney General John J. Hoffman said. “This $1.1 million civil penalty will serve as a deterrent and a clear reminder that we are watching, and that investors must also do their homework before investing.”

The Bureau said that the company repeatedly violated New Jersey’s Uniform Securities Law between March 2011 and August 2014 and sold at least $2.8 million worth of unregistered securities with the fraudulent offer and sale of EES common stock, common stock purchase warrants, and promissory notes to at least 225 investors.

EES has been issued a cease and desist order and must pay $1,125,000 in fines.