Regulators Pull the Plug on Alternate Energy

by Melissa Davis - 12/15/2010 8:13:29 AM

Four years after Alternate Energy (OTC: AEHI.PK) went public, courting investors with grand plans to build a multibillion-dollar nuclear power plant, the U.S. Securities and Exchange Commission has finally suspended trading in the controversial penny stock.

This week, the SEC halted AEHI due to questions about “the accuracy and adequacy of publicly disseminated information” about the company. When cracking down on AEHI, the SEC cited concerns about several issues – including company finances, executive compensation and insider sales – examined by TheStreetSweeper in its recent coverage of the company. (Click on these three links to access those stories and the backup documents used to prepare them.)

AEHI critics, who have been sounding alarms about the company for years, expressed clear relief at the long-awaited news.

“It was a scam from the beginning,” declared Joe Weatherby, a former planning and zoning commissioner in AEHI’s home base of Idaho. “This has been a long time in coming.

“I didn’t think it was ever going to happen,” he added. “So it was a great Christmas present.” 

AEHI did not respond to an email seeking input for this story.

Together with other local AEHI critics, including members of an environmental group known as the Snake River Alliance, Weatherby has been warning regulators about the company for some time. He had almost given up hope, however, until TheStreetSweeper began publishing detailed investigative reports about the company two months ago.

John Weber, a board member for the Snake River Alliance, expressed similar views.

“What you did started the ball rolling,” Weber told TheStreetSweeper this week. “It was about time that the SEC came in and did something about the scheme that AEHI has been working on for so long.”

To skeptics, AEHI looks like nothing more than a slow-motion pump-and-dump scheme. While many penny-stock scams unravel quickly, they say, AEHI managed to remain alive for years by focusing on a “mysterious” industry – nuclear power – that involves long-term business projects. AEHI raised millions by pitching its story to local investors, they note, but still lacks the funds necessary to build an actual nuclear power plant.

As detailed by TheStreetSweeper in its past coverage of the company, AEHI has announced funding deals with several obscure financial firms – including one whose leader would later be charged with alleged securities fraud – but has yet to secure those promised funds. Nevertheless, regulatory filings indicate, AEHI has found enough money to comfortably support its top executive while pursuing that elusive cash pile. 

“Last summer, (CEO Donald) Gillispie started driving around in a Porsche 911 twin turbo that costs around $150,000,” Weber told TheStreetSweeper in an earlier interview. “And he still has his Maserati parked out in front of the company’s office.”

AEHI has showered Gillispie and Vice President Jennifer Ransom – a former insurance agent described by locals as Gillispie’s girlfriend -- with massive chunks of company stock as well. Earlier this year, both Gillispie and Ransom filed the paperwork that would allow them to begin selling some of those shares. Even so, Gillispie later claimed that he never once sold any AEHI stock and had no immediate plans to do so.

“I would be foolish to sell it at 80 cents,” Gillispie told TheStreetSweeper back in October. “This stock is going to be worth a lot of money. It will probably be $2 by the first quarter – and $4 or $5 by the end of next year.”

Since then, AEHI has instead tumbled from 87 cents to 58 cents a share. With the stock now halted until at least Dec. 29, AEHI would need to finish the year with an explosive bang – more than tripling in price in a matter of days – in order to reach Gillispie’s $2 target. Chances are, critics say, AEHI will instead plummet if in fact it ever trades again.

“This is just the tip of the iceberg,” Weatherby insisted on Tuesday. “There is so much out there that the public doesn’t know.

“This was an absolute penny-stock scam,” he concluded. “It’s just mindboggling to me that it took so long to shut this thing down.”

* Note: No member of TheStreetSweeper’s staff or advisory board has ever taken a financial position in Alternate Energy (AEHI.PK) or received any compensation from others who have positions in the stock. As editor of the site, Melissa Davis will never take a position in any of the stocks that she covers. To contact Ms. Davis, the author of this story, please send an email to


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