U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 20451 / February 7, 2008

Securities and Exchange Commission v. Strategic Management & Opportunity Corporation; Robert J. Pratt; and Jeffrey A. Brommer, Civil Action No. C08-0197JLR (W.D. Wash.)

SEC Alleges "Pump and Dump" Market Manipulation by Strategic Management & Opportunity Corporation, CEO Robert Pratt, and Promoter Jeffrey Brommer

The Securities & Exchange Commission ("Commission") announced that it filed a Complaint in the United States District Court for the Western District of Washington against Strategic Management & Opportunity Corporation ("SMPP"), Robert J. Pratt ("Pratt"), and Jeffrey A. Brommer ("Brommer") on February 6, 2008. Pratt, who resides in Lynden, Washington, is the chairman and CEO of SMPP. Brommer, who resides in Jamestown, North Carolina, provides investor relations services.

The Complaint alleges that from February to August 2004, SMPP issued a series of materially false and misleading press releases concerning the market readiness of SMPP's kiosk systems and its capital raising efforts. According to the Complaint, those misrepresentations included touting a series of bogus funding agreements claiming SMPP would distribute 50 million restricted shares to four entities in exchange for $41.8 million. The Complaint alleges that SMPP did not have a market-ready product and had received a mere $1.25 million of the $41.8 million capital touted in the press releases. According to the Complaint, these misrepresentations drove up SMPP's stock price from $.10 per share on February 2 to a high of $4.50 on June 10. The Complaint also alleges that the distribution of those restricted shares significantly increased the total number of outstanding shares, enabling Pratt to sell much more stock than he otherwise would have been permitted under the securities regulations. The Complaint alleges that Pratt sold over 320,000 shares into the artificially-inflated market for a total profit of $628,947. The Complaint also alleges that Brommer, who was hired to provide investor relations services for SMPP, made misleading statements vouching for SMPP and Pratt. The Complaint alleges that Brommer had no independent basis in vouching for SMPP, but rather had a significant, undisclosed financial motive for his support of SMPP - his own receipt of 50,000 shares as compensation. The Complaint alleges that Brommer profited nearly $25,000 by selling SMPP shares during this time.

The Complaint alleges that SMPP, Pratt, and Brommer violated Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder and that Pratt and SMPP violated of Section 5(a) and 5(c) of the Securities Act of 1933. The Commission seeks permanent injunctions against each defendant, and disgorgement, prejudgment interest, civil penalties and penny stock bars against Pratt and Brommer, and an officer and director bar against Pratt.

Brommer, without admitting or denying the allegations in the Commission's Complaint, consented to the entry of a Final Judgment that would order Brommer to pay $24,916 in disgorgement and $1,084 in prejudgment interest, together with a civil money penalty in the amount of $40,000. The proposed Final Judgment also will enjoin him permanently from violating Section 10(b) of the Securities Exchange Act and Rule 10b-5 thereunder, and bar him from participating in an offering of penny stock. The settlement is subject to the Court's approval.

SEC Complaint in this matter