(Editor's Note: In the original edition of this story, we noted that Chris Lahiji had been paid for promoting Kingdom Ventures. He contests this characterization, stating that neither he nor his company received compensation for the email and that his interest in the ad was to promote his stock-picking website. We have no reason to doubt the veracity of this claim, so we have removed mention of direct payment to him. This, of course, brings up the prospect that Chris Lahiji recommended this company -- despite years of paid promotion and hype, commercial failure, questionable claims, and recent massive insider sales -- because he believed that this time, it was on to something. Danger. Will. Robinson. )

Chris Lahiji has made the shortest walk in history from a high school kid to a cynical penny stock shill. You may recognize his name: As a high school senior, he set about reading the annual reports of every publicly traded company in America -- about 12,000 of them. Soon after, Lahiji set about an extraordinarily aggressive self-promotion campaign, and it paid off big-time -- he appeared on a vast number of media outlets and finally hit gold when a drowning mutual fund, Frontier Equity, took the leap by offering him a co-manager position.

Keep in mind that all of this started when a kid set out to do something pretty neat. This feat is what defines Chris Lahiji. On one of his websites, he states emphatically that he is "the first person to ever read 12,000 annual reports." I doubt it. That's nearly all that Philip Fisher ever did, and it's what Berkshire Hathaway's (NYSE:BRK.A) Warren Buffett does with an inordinate amount of his time. The difference is that both of them read annual reports for the sake of understanding.

A little simple math makes me question whether, in Lahiji's case, even the word "read" is stretching reality. Simple math states that 12,000 annual reports divided by 365 adds up to nearly 33 reports each day. If he read for 10 hours a day, that's more than three per hour, or one every 18 minutes. That's hardly time to read the average letter to shareholders, much less a whole report. Certainly it's not enough time to read the financial statements, churn through the footnotes, and generate even a passing understanding of what is being presented.

While it may be accurate to say that Lahiji "thumbed" or "browsed" through 12,000 annual reports, I'd call "read" a bit implausible. Thankfully, he didn't use the word "understood." Some companies like Markel (NYSE:MKL), Infosys (NASDAQ:INFY), and IMS Health (NYSE:RX) have annual reports that make great doorstops and would take hours to read.

So I call shenanigans. It was a media stunt -- well constructed, to be sure -- but I don't buy it for a second. But whatever, Lahiji rolled it into a fund management job, he wrote a book. Good on him -- he's a hustler. There's nothing to say that there's an age limit on investing competence.

Ah, but a look in my inbox this morning suggests that he's hustling in more ways than one. Yep, Lahiji isn't just a penny stock investor; he's a penny stock promoter. He has a website that gives his penny stock selection du jour. He allowed one company with a history of questionable claims, years' worth of aggressive stock promotion, and massive recent insider sales to spam his opinion on the company to millions of email inboxes, including mine. And with that step, he moves from being an overzealous naïf -- dangerous only to those who turn their money over to him -- to one who descends into that special slice of market participants who should in no way garner your trust.

Let me show you what I mean, using the company featured today as an example. It's called Kingdom Ventures (OTC BB: KDMV). Lahiji's email suggests that the company will earn $0.13 per share in 2004. He calls Kingdom Ventures the "only pure play stock that provides products and services to the Christian marketplace and churches." This must come as quite a shock to Salem Communications (NASDAQ:SALM), which provides religious radio services. But that's a debatable point.

Here are some things that are not debatable.

This past week, Kingdom Ventures filed a notice that it couldn't file its annual report on time with the SEC, though its fiscal year ended in January. The reason for the late filing? Acquisitions made in 2003, plus a $3 million increase paid to consultants in the form of below-market warrants on the company's stock. Pretty thin reasoning for a late filing, but more interesting was that this wasn't mentioned in Lahiji's email. After all, a late SEC filing is an enormous red flag. This coming from a company that already attracted SEC attention last year because of questions about suspicious trading of its common stock. Neither of these items was mentioned in Lahiji's breathless report.

Want more? I could recount the long history of the apparent shell game that is Kingdom Ventures, but Scott Patterson at SmartMoney.com already did a terrific job of that this past December. Highlights include a history of aggressive stock promotion, press releases with questionable claims stated as fact, what a forensic accountant calls "fictitious" accounting, and allegations between Kingdom Ventures and an affiliate called RCM surrounding a stock promotion deal that helped attract the SEC in the first place. Given that Kingdom Ventures has been the vehicle for past promotional activity that has run afoul of regulators, one would think that anyone who wishes to keep his reputation intact would stay far away.

But there's more. In his email, Lahiji notes that one of the big promising elements of Kingdom Ventures is its ownership in Christian Times. But an argument between Kingdom Ventures and Keener Communications shows something interesting: Kingdom Ventures claims that it has purchased the rights to Christian Times, where in actuality what it bought from Keener was just the trademark, not the circulation of the papers, which sits at 180,000 subscribers.

A read of coverage of Kingdom Ventures at securities watchdog website Our Street ought to be enough to have any sane investors running away in horror from this company. You'll find a history of balance sheet reversals, various and sundry business ventures, and other things that point to a company that very much deserves its position in the cesspool of the over-the-counter bulletin boards. Yet, in the midst of a delay of the company's 10-K, someone associated in some way with Kingdom Ventures (even if it is a minority shareholder) got Lahiji to have "It's a great stock to own right now" broadcast into the ether.

What's more, according to Lahiji, he gave a glowing recommendation in advance to subscribers on his paid site. My question is: Why in the world weren't these really damaging pieces of information about Kingdom Ventures disclosed? And why, if this is such a great stock to own right now, is J&J Holdings -- wholly owned by CEO Gene Jackson's spouse, children, brother, and his family -- selling more than 80% of its stake in the company at the same time?

It doesn't really add up that a company can be a great investment when one of its largest shareholders is unloading a substantial portion of its position.

Here's what does add up, though. There has been a rapid rise in the number of spam emails hyping penny stocks. And the reason for the rise is pretty simple: They work. They work because the people who put them out know that there is a large component of individual investors who are unsophisticated and lazy. By lending his name on this one, Lahiji has joined that particular cynical fraternity and transformed himself from sideshow to financial menace.

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Bill Mann owns shares of Markel and Berkshire Hathaway. The Motley Fool is investors writing for investors.