U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 17446 / March 28, 2002

SECURITIES AND EXCHANGE COMMISSION v. NEW ENERGY CORP., TOR EWALD, GENEVA FINANCIAL LTD., MARCELINO COLT aka MARCELINO COLT VASQUEZ, MAGNUM FINANCIAL GROUP, LLC, MICHAEL S. MANAHAN, BLD TRUST, BARCLAY DAVIS, LORETTA DAVIS, BURKE T. MAXFIELD, YORK CHANDLER, AND HECTOR CAMPA ACEDO, Civil Action No. CV-02-989-MMM (CWx) (C.D. Cal.)

The Securities and Exchange Commission ("Commission") announced that on February 19, 2002, New Energy Corp. ("New Energy") and its largest shareholder, Tor Ewald ("Ewald"), were permanently enjoined from future violations of the antifraud provisions of the federal securities laws. Ewald, age 36, of La Jolla, California, is also the Secretary and Treasurer of New Energy. In addition, on February 22, 2002, the Court indefinitely extended an asset freeze previously entered against defendants Marcelino Colt ("Colt"), a Panamanian citizen residing in Panama and Mexico, who claims to be an investment banker, and Geneva Financial Ltd. ("Geneva"), a Nevis corporation which purports to be an international investment banker. Thereafter, on February 27, 2002, Magnum Financial Group, LLC, dba Stratos Research LLC ("Magnum"), a California limited liability company that provides public and investor relations services, and Magnum's president, Michael S. Manahan, age 46, of Harbor City, California, were also permanently enjoined from future violations of the antifraud provisions of the federal securities laws.

The Commission's complaint, filed on February 1, 2002, alleges that New Energy and Ewald were part of a "pump and dump" scheme to manipulate New Energy's stock price during a one-month period ending on January 18, 2002, when the Commission suspended trading. On February 1, 2002, the Commission filed an emergency action to halt the ongoing scheme. The Court issued a temporary restraining order the same day.

The Commission's complaint alleges that Colt orchestrated the manipulative scheme, including the hiring of Magnum to post a false and misleading buy recommendation, the distribution of mass e-mails or spam containing fraudulent statements, issuing a false and misleading press release, and placing the release onto New Energy's website. These included, among other things, false and misleading claims regarding a relationship with the Los Angeles Department of Water and Power ("DWP"), negotiations with Coca-Cola bottlers in Mexico for thermal generators, and false claims that New Energy's partner had a "virtual lock" on the world market for high concentration ("HCPV") solar cells.

The Judgments against New Energy, Ewald, Magnum and Manahan enjoin them from future violations of the antifraud provisions of the Securities Exchange Act of 1934, Section 10(b) and Rule 10b-5 thereunder. The Judgments additionally order that New Energy, Ewald, Magnum and Manahan shall pay any monetary relief in amounts subsequently to be determined by the Court. New Energy, Ewald, Magnum and Manahan consented to the entry of the Judgments without admitting or denying the Commission's allegations.

Finally, pursuant to the consent of the parties, the Court entered a limited asset freeze against relief defendants York Chandler ("Chandler") and Burke Maxfield ("Maxfield"). The Court froze $82,500 of Chandler's assets and $159,250 of Maxfield's assets pending the final resolution of the Commission's action against them. The amounts represent alleged ill-gotten gains from trading New Energy shares.

For further information about the Commission's action, see Litigation Release No. 17350.

SEC Complaint in this matter.