A Boston firm today canceled a tentative agreement to finance National Lampoon Inc. films, a move that follows the arrest yesterday of the Los Angeles company's CEO on charges he fraudulently manipulated the company's stock.
Envit Capital CEO Edward Laborio said in a statement that he is terminating an October agreement to provide funding for TV productions and moderate-budget feature films. Laborio said Envit had not yet put money up.
National Lampoon CEO Dan Laikin, a former Indianapolis businessman, was arrested at his southern California home yesterday, hours before criminal and civil investigators unveiled charges that he participated in a scheme to artificially inflate the company's stock price.
The company's stock did not open for trading yesterday and trading also is suspended today. It closed Friday at 73 cents a share.
Officials with the U.S. Attorney's Office and the Securities and Exchange Commission in Philadelphia allege that Laikin, 46, paid kickbacks to a stock promoter and another individual he believed had connections to corrupt brokers.
The individual was cooperating with the Federal Bureau of Investigation, according to the SEC. The suit quotes directly from conversations Laikin allegedly had with the cooperating witness.
According to the SEC, "Laikin ... sought to artificially push National Lampoon's stock price from under $2 a share to at least $5 per share, in part, to keep the company's stock price above the minimum listing requirements of the AMEX, and to increase National Lampoon's ability to enter into possible 'strategic partnerships' and acquisitions." It said the fraud occurred from March through June of this year.
Efforts to reach Laikin for comment were unsuccessful.
Laikin, the brother of Brightpoint Inc. CEO Bob Laikin, was part of an Indianapolis group that started amassing a major stake in National Lampoon nearly a decade ago.
In media interviews, he said he wanted to breathe new life into a comedy brand best known for the 1978 classic "Animal House." However, the company continued to struggle.
Also on the board of National Lampoon are Indianapolis businessmen Paul Skjodt and Tim Durham. Neither Skjodt nor Durham is a defendant in the civil or criminal proceedings.
Durham and Skjodt could not be reached.