INITIAL DECISION RELEASE NO. 1132

ADMINISTRATIVE PROCEEDING 

FILE NOS. 3-17861, 3-17862, 3-17863

UNITED STATES OF AMERICA

Before the

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

In the Matter of 

the Registration Statements of

GO EZ CORPORATION, 

ARC LIFESTYLE GROUP INC., and

NOVA SMART SOLUTIONS INC.

INITIAL DECISION OF DEFAULT 

May 9, 2017

APPEARANCES: Virginia M. Rosado Desilets, Sonia G. Torrico, Jessica L. Medina, and 

Matthew Scarlato, for the Division of Enforcement, Securities and 

Exchange Commission 

BEFORE: Cameron Elliot, Administrative Law Judge 

I. BACKGROUND

On February 27, 2017, the Securities and Exchange Commission issued orders instituting 

proceedings (collectively, OIPs) pursuant to Section 8(d) of the Securities Act of 1933 as to 

Respondents Go EZ Corporation, Arc Lifestyle Group Inc., and Nova Smart Solutions Inc., and 

set a hearing for March 16, 2017. The OIPs allege that each Respondent filed with the 

Commission a registration statement, as amended, that contained numerous material 

misstatements and omissions relating to (1) the identities of Respondents’ officers, directors, 

promoters, and/or control persons, (2) related party transactions, and/or (3) the nature of their 

operations. The OIPs also charge Respondents with failure to cooperate with Commission staff 

examinations conducted pursuant to Securities Act Section 8(e) by failing to respond fully to 

subpoenas and to make key individuals available to Commission staff. 

The proceedings were consolidated for hearing. Go EZ Corp., Admin. Proc. Rulings 

Release No. 4640, 2017 SEC LEXIS 621 (ALJ Feb. 28, 2017). Each Respondent was served 

with the OIP specific to its case on March 2, 2017, in accordance with Securities Act Section 

8(d). Go EZ Corp., Admin. Proc. Rulings Release No. 4679, 2017 SEC LEXIS 765 (ALJ Mar. 

14, 2017). No Respondent appeared at the March 16 hearing and, to date, none has answered the 

OIP specific to its case or responded to my order to show cause why it should not be found in 

default. Go EZ Corp., Admin. Proc. Rulings Release No. 4689, 2017 SEC LEXIS 796 (Mar. 16, 

2017). 
2

In an e-mail dated March 31, 2017, Mr. Abraham Cinta responded to the order to show 

cause on behalf of Go EZ as its purported CEO and director, arguing that Go EZ was not 

properly served with the OIP and attempting to explain its failure to appear. See Go EZ Corp., 

Admin. Proc. Rulings Release No. 4725, 2017 SEC LEXIS 1018 (Apr. 3, 2017). The Division 

responded and I ordered Cinta to submit a reply. Id. I have not heard further from Cinta. 

The Division filed its post-hearing brief on April 7, 2017.

II. FINDINGS OF FACT

Respondents are in default for failing to file an answer, appear at the hearing, or 

otherwise defend the proceeding. 17 C.F.R. § 201.155(a). I therefore deem true the allegations 

in the OIPs. Id. I apply preponderance of the evidence as the standard of proof for findings 

beyond the allegations of the OIPs. See Steadman v. SEC, 450 U.S. 91, 101-04 (1981). 

A. Registration Statements and the Staff Investigations

1. Go EZ

In early 2015, Go EZ filed a Form S-1 registration statement seeking to register the offer 

and sale of 1,387,500 shares of common stock. Ex. E-1. Go EZ amended the registration 

statement five times, the final amendment occurring in October 2015. Exs. E-1 to E-6. The 

registration statement was declared effective on November 6, 2015. Ex. E-7. On April 1, 2016, 

with the offering ongoing, the Commission authorized the Division to conduct an examination 

pursuant to Section 8(e) of the Securities Act, 15 U.S.C. § 77h(e), and suspended trading in Go 

EZ effective April 4, 2016. Exs. 1-A, 1-B.

On April 4, 2016, the Division provided Go EZ with notice of its examination and 

requests for documents and testimony from Go EZ’s officers, directors, and others. Exs. 1-C to 

1-E. On April 8, 2016, Cinta, Go EZ’s then-sole officer and one of two directors, participated in 

a telephone call with the Division as a representative of Go EZ. Torrico Decl., Ex. 1, ¶ 43. Cinta 

refused to make himself or any other representatives of Go EZ available for testimony in the 

United States. Id. ¶ 43(e); see also Ex. 1-G. On May 4, 2016, Cinta produced documents to the 

Division on behalf of Go EZ. Ex. 1, ¶ 8. On June 15, 2016, the Division identified to Cinta 

several critical shortcomings in Go EZ’s production and requested that he cure these

deficiencies. E-mail from Virginia Rosado Desilets to Abraham Cinta, Ex. 1-F. For example, 

the Division received documents related to Go EZ from several third parties, including 

communications with Go EZ affiliates that should also have been in Go EZ’s possession. Ex. 1, 

¶ 8. On July 15, 2016, Cinta informed the Division that he had resigned his positions as officer 

and director of Go EZ and that the Division should direct any inquiries to Go EZ’s sole 

remaining director, Fang Ren, or to its majority owner, Evotech Capital, S.A. (Evotech). Ex. 1-

G. Cinta did not respond to requests for contact information for Ren or Basilio Chen (of 

Evotech). Ex. 1, ¶ 12; Ex. 1-H.
3

2. Arc Lifestyle

In September 2015, Arc filed a registration statement, amended in November 2015 and 

February 2016, seeking to register the offer and sale of 6,488,400 shares of common stock. Exs. 

EE-1 to EE-3. The Commission authorized the Division to conduct an examination of Arc’s 

registration statement before it became effective. Ex. 3-A. On April 4, 2016, the Division 

provided Arc with notice of its examination and requests for documents and testimony from 

Arc’s officers, directors, and others. Exs. 3-B to 3-E. On April 11, 2016, Carlos Lopez, Arc’s 

sole officer and director, produced documents to the Division on behalf of Arc. Rosado Desilets 

Decl., Ex. 3, ¶ 12. On April 18, 2016, Lopez participated in a telephone call with the Division as 

a representative of Arc. Ex. 3, ¶ 28. On May 12, 2016, and June 15, 2016, the Division 

identified to Lopez several critical deficiencies in Arc’s production of documents and requested 

that he produce additional documents to comply with the subpoenas. Ex. 3, ¶¶ 13, 15; Ex. 3-J. 

For example, Lopez’s production did not include any correspondence despite the subpoena for emails or other correspondence on behalf of or concerning Arc. Ex. 3, ¶ 12; Ex. 3-C. Yet the 

Division received at least 200 relevant e-mails and other communications from third parties that 

involved Arc but were not in Arc’s document production. Id. Arc did not produce any 

additional documents. Ex. 3, ¶¶ 14-16. Lopez also failed to provide the Division with his 

availability for testimony, despite initially agreeing to do so, and he did not make himself or any 

other representatives of Arc available for testimony in the United States. Ex. 3, ¶¶ 14, 16, 29, 

29(a)-(b). 

3. Nova Smart

Nova Smart filed its registration statement in January 2016, seeking to register the offer 

and sale of 28,057,000 shares of common stock. Ex. EEE-1. It amended the registration 

statement in February 2016. Ex. EEE-2.

Nova Smart’s registration statement was not yet effective when the Commission 

authorized the Division to conduct an examination. Ex. 4-A. On April 4, 2016, the Division 

provided Nova Smart with notice of its examination and requests for documents and testimony 

from Nova Smart’s officers, directors, and others. Exs. 4-B to 4-D. In April and May 2016, 

Sergio Camarero Blanco, Nova Smart’s president and CEO, and Jesus Hoyos Quintero, Nova 

Smart’s CFO, provided documents to the Division on behalf of Nova Smart. Torrico Decl., Ex. 

4, ¶ 7. Both Camarero and Quintero participated in separate telephone calls with the Division as 

representatives of Nova Smart. Ex. 4, ¶¶ 21-22. From May through July, the Division identified 

to both Camarero and Quintero several critical shortcomings in Nova Smart’s production of 

documents and requested that they produce additional documents, but they never did. Ex. 4-E. 

For example, many of the communications provided to the Division by Nova Smart’s outside 

auditors that copied Nova Smart officers and/or consultants were not produced to the Division by 

Nova Smart. Ex. 4, ¶ 7; Ex. 4-E. In addition, both Camarero and Quintero refused to make 

themselves or any other representatives of Nova Smart available for testimony in the United 

States. Ex. 4-E.
4

B. Misrepresentations in Respondents’ Registration Statements

1. Go EZ

Go EZ is a Delaware corporation purportedly headquartered in Miami Beach, Florida, 

that claims to be an e-commerce and mobile technology business selling smartphone accessories. 

Ex. E-6, at 9. Its former sole officer and employee, Cinta, resides outside of the United States, as 

does its director, Ren. Id. at 15; Ex. E-8. 

Go EZ’s registration statement discloses that Evotech acquired majority ownership of it 

and that Evotech appointed Cinta as sole officer and director of Go EZ. Ex. E-9, at 2. The 

registration statement fails to disclose, however, that Evotech is owned and controlled by Basilio, 

its executive chairman and managing partner, Exs. 1-J to 1-N; Ex. 1-O at 239-40, and that 

Basilio exercised control over Go EZ. In a telephone call with the Division, Cinta acknowledged 

that he had worked at Evotech and that the formation of Go EZ had been Basilio’s idea. Ex. 1, 

¶ 43(a), (f). Similarly, Roger Ng, who met Basilio while working at one of Basilio’s other 

companies, testified that Evotech was Basilio’s alter ego and that all of the transactions that Ng 

entered into with Go EZ were at Basilio’s, not Cinta’s, instruction, even though Ng’s dealings 

with Go EZ were through Cinta. Ex. 1-P at 20, 220, 224; Ex. 1-Q.1 Finally, Eduardo Paz, a 

middleman for Go EZ who arranged its transactions, testified that he was involved with Go EZ at 

Basilio’s request, and that Basilio “gave the go-ahead” on purchasing assets for Go EZ. Ex. 1-O 

at 47-50; see also Ex. 1-R.

In late 2014, Basilio asked Ng to acquire a seventy-percent interest in Federal 

Technology Agency (FTA) and to sell that interest to Go EZ. Ex. 1-Q; Ex. 1-P at 224, 243-44. 

At the time, FTA was wholly owned by Basilio’s son, Benedict Chen. Ex. 1-T; Ex. 1-P at 238-

40. Ng paid Benedict $35,000 for seventy percent of FTA, and then swapped that interest with 

Go EZ in exchange for restricted and unregistered shares in Go EZ. Ex. 1-Q; Ex. E-6, at 25. 

Neither Basilio’s involvement in the transaction or his relationship with Ng and with Benedict 

was disclosed in the Go EZ registration statement.

The registration statement states that Go EZ’s acquisition of seventy percent of FTA was 

part of its business plan to “focus[] on the development of technology and internet-based 

businesses.” Ex. E-6, at 7. Prior to the transaction, Benedict had used FTA as a corporate alter 

ego in his contract work with CyberCoders, Inc., a technology staffing firm. Ex. 1-P at 238-40; 

Exs. 1-T to 1-X (FTA agreements and bank statements).

The registration statement describes FTA as “a provider of computer software 

programming, testing and development services to tech companies such as Apple,” Ex. E-6, at 7, 

and states that “[i]t is uncertain whether FTA can maintain its current customer base,” id. at 16. 

But FTA had no “current customer base” at the time of the registration statement. Ex. 1, ¶ 43(i), 

(k). Its contract with Apple concluded before Go EZ acquired FTA, and FTA has only provided 

services to Apple, not to “tech companies such as Apple.” Id. ¶ 43(j); Ex. E-6 at 33 (stating that 

 

1

 Ng testified at length about his longstanding relationship and frequent business dealings with 

Basilio, and also testified that he had known Basilio’s son for a long time. Ex. 1-P at 20, 238-

239, 315, 318-322; see also Exs. 1-Q and 1-GG (describing various transactions).
5

“one such contract has been entered into”); Exs. 1-U to 1-X (FTA’s agreements and bank 

statements reflecting payments only from CyberCoders and its parent, On Assignment).

The registration statement further suggests that FTA used multiple independent 

contractors to assist with operations. Ex. E-6, at 34, 50 (“FTA completes assignments by 

contracting with independent contractors” and Benedict is “one of the independent contractors 

who FTA has contracted with”). In fact, to the extent FTA conducted operations (i.e., before Go 

EZ’s acquisition), they were conducted solely by Benedict. Compare Ex. E-6 at 39 (stating that 

FTA’s full payroll expenses for 2014 totaled $39,379), with id. at 50 (stating that in 2014 FTA 

paid Benedict $39,379 in compensation).

In addition, in early 2015, Basilio contracted Paz to identify potential acquisitions for Go 

EZ, and Paz found Cellular of Miami Beach, Inc. (CMBI), which operated a retail cellular phone 

and accessories store. Exs. 1-Y, 1- Z; Ex. 1-O at 46-47, 91-93. As with FTA, Basilio asked Ng 

to acquire CMBI and sell it to Go EZ. At Basilio’s instruction, Ng purchased CMBI for $40,000, 

and inserted the assets and operations into Glophone, Inc., a wholly owned subsidiary of Go EZ, 

in exchange for more restricted and unregistered shares of Go EZ. Ex. 1-Q; Ex. 1-P at 220; Ex. 

E-6, at 7. Neither Basilio’s involvement in this transaction nor Basilio’s relationship with Ng 

was disclosed in the registration statement.

Go EZ’s registration statement states that Glophone “has one retail store, of 

approximately 700 square feet, located at 6782 Collins Avenue, Miami Beach, Florida 33141, 

which also serves as [Go EZ’s] physical mailing address.” Ex. E-6, at 34. Glophone was not 

operating the retail store at the time of the registration statement. The store’s operator, Ernesto 

Guerra, testified that he initially operated the store for Glophone, but quickly realized that the 

individuals in China to whom he was reporting his revenues were unwilling to provide any 

funds, inventory, or other assistance to the store. Ex. 1-BB at 53, 68. Go EZ abandoned any 

claim to the store’s revenues or profits. Exs. 1, ¶ 43(p); 1-BB at 53-56. Guerra eventually cut 

off all ties to Go EZ and Glophone and formed his own corporation to run the store. Ex. 1-BB at 

35, 100-01, 104. Cinta told the Division in April 2016 that he did not know where the new store 

was and had never visited it. Ex. 1, ¶ 43(n); Ex. 1-BB at 38.

Furthermore, the registration statement states that it sells a “‘GO EZ’ brand 

‘smartwatch’” and that “[a]dditional development of the product is underway in order to improve 

the user experience.” Ex. E-6, at 34. But Cinta informed the Division that the smartwatches Go 

EZ sold were purchased as-is from a manufacturer in China and that Go EZ neither contributed 

any programming or development to the watches nor planned to do so in the future. Ex. 1, 

¶¶ 43(r)-(u). Cinta further explained that Go EZ had not done any programming of the 

smartwatch because it would have required too many resources, and because Benedict had been 

unavailable since FTA’s acquisition. Id. ¶ 43(u).

Finally, the registration statement lists the 6782 Collins Avenue address as Go EZ’s 

“principal executive offices,” Ex. E-6, at 1, but Cinta operates out of Shanghai. Ex. 1, ¶ 43(c). 

Go EZ’s registration statement also claims offices at other locations. It claims that an address in 

Los Altos, California, was Go EZ’s “previous principal executive offices.” Ex. E-6, at 1. But 

that address is a mailbox facility, not an office building. Ex. 1-HH; Ex. 1, ¶ 38. Further, the 

mailbox listed on the registration statement has been rented for several years by Martin Nielson, 
6

CEO of EWaste Systems, Inc., who is not affiliated with Go EZ. Exs. E-10 to E-12; Ex. 1-KK. 

Go EZ’s registration statement further claims that “FTA has its own leased office space, at 1047 

Amarillo Avenue, Palo Alto, California” and that an “officer/shareholder of the Company is 

allowing the Company to use his office as a mailing address.” Ex. E-6, at 34, F-12. That 

address, however, is Benedict’s home address, not a “leased office space.” Exs. 1-II, 1-LL; Ex. 

1, ¶ 39. Benedict is not an officer or a shareholder of Go EZ, but is described by the registration 

statement only as an “independent contractor” for FTA. Ex. E-6, at 50.

The registration statement discloses that Go EZ is in the early stages of development and 

is “no longer a shell company.” Ex. E-6, at 9, 16. A “shell company” is defined as a company 

with no or nominal operations and with no or nominal assets or assets consisting solely of cash 

and cash equivalents. 17 C.F.R. § 240.12b-2. The registration statement claims that Go EZ 

ceased to be a shell company when it acquired FTA (Ex. E-6, at 16); as explained above, 

however, FTA had no operations at that time and has not had operations since. Indeed, Cinta’s 

own statements show that Go EZ had no operations and no genuine intent to develop operations 

at the time the registration statement was filed. Ex. 1, ¶ 43(j)-(k), (o)-(p), (u)-(y).

2. Arc Lifestyle

Arc is a Florida corporation purportedly headquartered in Miami, Florida, that claims to 

specialize “in the selling of multinational lifestyle products” such as designer apparel and 

Spanish wine and olive oil. Ex. EE-3, at 2. Lopez serves as Arc’s sole officer and director and 

started Arc while he was still working at Evotech. Ex. 3-Q; Ex. 3, ¶ 23. In addition to Lopez 

and Cinta, Basilio’s Evotech firm employed a number of other individuals connected to Go EZ, 

Arc, and Nova Smart. Xiaoyue Zhang, and Rory San, whose names appear on the Arc and Nova 

Smart registration statements, were both employees of Evotech before leaving Evotech to help 

Lopez create Arc and Nova Smart. Id. 

Arc’s registration statement states that its revenue stream stems “from the sale of fashion 

based products and affordable and high quality nutritional food & beverage products such as red 

wine and olive oil.” Ex. EE-3, at 2. Arc claims to have entered the apparel business “with the 

online sales of Korean designer women’s wear through our agreement with Shanghai Fan Xi 

Commerce Co., Ltd. (‘Fanxi’) . . . a private company based in Shanghai.” Id. Pursuant to that 

agreement, Arc manages Fanxi’s “operations, marketing and sales, contracting, and billing and 

collections,” in exchange for “a management service fee each quarter equal to all of its net

income for such quarter based on the quarterly financial statements provided.” Id. at 2, F-14, F22 to F-23; see also Ex. EE-3, at Ex. 10.1 (management agreement between Arc and Fanxi). The 

Arc registration statement further states that Fanxi “operates ‘82 Room’, the online in-house 

fashion platform that markets and sells outstanding Korean designer brands into the Chinese 

market” using Taobao, an online marketplace, id. at 32, and names Xiaoyue as an Arc 

“consultant” who is the “legal representative of Fanxi” and Yawei Zhang as being “responsible 

for the operation and development of . . . 82 Room under Fanxi.” Id. at 41. The registration 

statement also claims that Arc “has generated revenue of $10,426 from July 1, 2015 to 

September 30, 2015 from, among other things, operations of [82 Room] managed under Fanxi.” 

Id. at 31.
7

In fact, neither Fanxi nor Arc own or operate 82 Room, and Arc has never received

revenue from 82 Room’s operations. Lopez admitted that Yawei does not work for Arc or Fanxi, 

but she owns and operates 82 Room independent of Arc and Fanxi, and that Arc has never 

received any revenues relating to 82 Room. Ex. 3, ¶ 28(h)-(j).

The registration statement states that Arc also sells and distributes red wine through two 

agreements with Camarero and Alvaro Gallego Grajal. Ex. EE-3, at 32. Through these 

agreements, Arc states that it is able to source Lynus Vinedos y Bodegas (Lynus) branded wine 

and Sirei888 S.L. branded wine and olive oil to resell in China. Id. at 2, 32. However, the

registration statement fails to disclose the related-party nature of Arc’s agreement to distribute 

Lynus wines. Not only is Camarero a childhood friend of Lopez, but the Lynus wine business 

belongs to Lopez’s father. Ex. 3, ¶ 28(k)-(1).

The Arc registration statement lists consulting agreements entered into by Arc with

various consultants, including: (1) Cinta, advisor to the CEO; (2) San, finance advisor; and

(3) Xiaoyue, Arc’s head of operations and administration. Ex. EE-3, at 24, 41. These

individuals held key positions within Arc and were issued shares of common stock. Id. The 

registration statement states that, aside from the consulting relationship, “[t]here is [sic] no 

known other relationships that exist between the registrant and the selling security holders.” Id.

at 24. This statement is false. Lopez has known Cinta, San, and Xiaoyue since at least

September 2014, and had previously worked with all three at Evotech and with Cinta and San at

Go EZ. Ex. 3, ¶¶ 23-25, 27(a)-(b), 27(d)-(e), 28(a)-(c); Exs. 3-Q to 3-S. 

Arc’s registration statement makes several misstatements that create the false appearance 

of operations around the world and within the United States. First, it states that Arc’s revenue 

streams stem “from the sale of fashion based products and affordable and high quality nutritional 

food & beverage products such as red wine and olive oil.” Ex. EE-3, at 2. The registration 

statement fails to disclose that Arc had no current inventory of olive oil to sell. Ex. 3, ¶ 28(r).

Second, according to the registration statement, the “business and registered office is

located at 10360 SW 186th Street, Miami, FL 33197.” Ex. EE-3, at 2. However, Arc does not

have any operations or an office in the United States. The listed address is a United States Postal

Service mailbox facility unrelated to Arc’s business or operations, and mail to that address was 

returned as undeliverable. Ex. 3, ¶¶ 7-10; Exs. 3-E to 3-H.

Third, the registration statement states that Arc “operates in a number of countries and 

derives revenues from both inside and outside the United States,” and that (1) Lopez resides in 

Spain; (2) Cinta resides in Mexico; and (3) San resides in Edinburgh, Scotland, United Kingdom. 

Ex. EE-3, at 8, 41, 43. But Lopez admitted that all three reside in China now, and did at the time 

the registration statement was filed. Ex. 3, ¶¶ 18-20, 27(c), 28(b)-(g); Exs. 3-L to 3-N. 

Fourth, the registration statement lists Capital Flows Ltd. as Arc’s incorporator and 

promoter. Ex. EE-3, at 3, 19, 24, 43 n.1. In fact, Arc was incorporated by another individual, 

and Lopez stated that Capital Flows was only an investor in Arc. Ex. 3, ¶¶ 26, 28(n)-(o); Ex. 3-P

at 193.
8

Finally, the registration statement states that Arc is “not a shell company as defined under 

section 12b-2 of the Exchange Act.” Ex. EE-3 at 30. Yet Lopez’s own statements show that Arc 

has nominal operations stemming from its resale of wine and olive oil and none from its sale of

Korean women’s wear, and had no genuine intent to develop its planned principal operations at 

the time the registration statement was filed. Ex. 3, ¶ 28(h)-(j), (r).

3. Nova Smart

Nova Smart is a Florida corporation purportedly headquartered in Granville, Michigan,

and claims to have business lines related to drone development and corporate staffing services. 

Ex. EEE-2, at 6. The company asserts that it has two directors, one serving as the chief 

executive officer and the other as the chief financial officer, and seven consultants. Id. at 59-60.

Its registration statement discloses two consultants, Lopez and Cinta, as responsible “for 

the provision of consulting services relating to the public markets” and giving “advice and 

guidance regarding . . . the setting up and management of a public company.” Ex. EEE-2, at 59-

60, II-3. Separately, the registration statement discloses that its largest shareholder is Arc 

Capital Ltd, which it describes as a “founder” but “is not considered to be a promoter of Nova as 

it was responsible for the incorporation of the Company but is not responsible for organizing the 

business and does not exert any control over the business of the Company or management.” Id.

at 63 n.1. The registration statement also states that San is “providing consulting services 

relating to the financial matters of the Company” and Xiaoyue is “responsible for providing 

consulting services relating to the administration of the Company.” Id. at 60.

Nova Smart fails to disclose that these individuals are controlling significant aspects of 

the company and also hides their association with Arc Capital. First, Lopez gave more than 

“advice and guidance”; rather, he played the lead role in founding, organizing, and operating 

Nova Smart, even more so than its officers and directors. Torrico Decl., Ex. 4, ¶ 22(b). As 

Camarero admitted, Lopez was responsible for choosing Nova Smart’s original principal place of 

business and selecting and paying the law firm that incorporated Nova Smart and serves as its 

registered agent, Spiegel & Utrera, P.A. (Spiegel). Id. ¶ 21(e), (g); Exs. 4-M, 4-N. Lopez also 

decided upon using a 6790 Collins Ave. address in Miami, Florida, both for Nova Smart’s 

incorporation documents and the January 5, 2016, registration statement, even though both

Camarero and Quintero admitted that Nova Smart has no operations in the United States and

conducts business out of Shanghai. Ex. 4, ¶¶ 21(e)-(f), 22(c); Ex. 4-J; EEE-1, at 1. In addition,

documentary evidence reflects that Lopez paid Spiegel on behalf of Nova Smart. Ex. 4-M 

(Spiegel receipt to Nova Smart acknowledging payment of $389.90 on May 31, 2015, for 

incorporation and registered agent services); Ex. 4-N (debt agreement reflecting that Lopez 

loaned $389.90 to Nova Smart on May 31, 2015).

Lopez also played a significant role in the filing of Nova Smart’s registration statement. 

Lopez introduced Nova Smart to the law firm and transfer agent that facilitated its filing. Ex. 4,

¶ 21(g). Lopez gave Camarero a template S-1 to use for Nova Smart, as demonstrated by Nova 

Smart’s January 5, 2016, registration statement, which contains references to business lines—

apparel and a lifestyle business—that are not part of Nova Smart’s business plan, but describe

Arc’s business. Ex. 4, ¶ 21(h); Ex. EEE-1, at 13, 19, F-6.
9

Second, contrary to the assertion that Arc Capital is not a promoter of Nova Smart, three 

of Nova Smart’s key consultants—Lopez, Cinta, and Xiaoyue—are associated with Arc Capital 

and referred numerous shareholders to Nova Smart. Documents Arc Capital submitted to Alpine 

Securities show that Cinta and Lopez serve as consultants for Arc Capital. Exs. 4-H, 4-I. In 

addition, Camarero confirmed that Arc Capital’s owner, Mengying Wang, is a cousin of 

Xiaoyue, another Nova Smart consultant who previously worked with both Lopez and Cinta at 

Evotech. Ex. 4, ¶ 21(c). Camarero and Quintero confirmed that the majority of the Nova Smart 

shareholders, including some of the largest such as Arc Capital and Capital Flows, were 

introduced through Lopez, Cinta, or Xiaoyue. Id. ¶¶ 21(j), 22(f).

Third, although the Nova Smart registration statement describes San as being responsible

for providing consulting services relating to Nova Smart’s financial matters, it fails to

acknowledge that he also acted as a promoter for Nova Smart. Both Camarero and Quintero

admitted that San was responsible for introducing Nova Smart to its outside auditors, Accell 

Audit & Compliance, P.A. Ex. 4, ¶¶ 21(i), 22(e). In addition, San was responsible for Accell’s 

hiring, and he worked directly with Accell throughout the filing and amendment of the Nova 

Smart registration statement. Ex. 4-O.

The registration statement identifies two directors, Camarero, who also serves as the 

president and CEO, and Quintero, who also serves as the CFO, and states that they “are 

responsible for the Company’s day to day operations.” Ex. EEE-2, at 49. However, there is no

resolution appointing Quintero a director of Nova Smart, as contrasted with the resolution

appointing Camarero, and all board resolutions are signed solely by Camarero. Exs. 4, ¶ 22(d);

4-Q. When staff specifically requested documentation showing Quintero was a director of Nova

Smart, nothing was provided. Ex. 4, ¶¶ 8-9. Quintero further admitted he is not involved in

Nova Smart’s day-to-day operations. Id. ¶ 22(d).

III. CONCLUSIONS OF LAW

A stop order is appropriate for two independent reasons: (1) material misstatements and 

omissions in Respondents’ registration statements and (2) Respondents’ failure to cooperate with 

the examinations of their registration statements.

A. Misstatements and Omissions of Material Facts

Section 8(d) of the Securities Act states:

If it appears to the Commission at any time that the registration 

statement includes any untrue statement of a material fact or omits 

to state any material fact required to be stated therein or necessary 

to make the statements therein not misleading, the Commission 

may . . . issue a stop order suspending the effectiveness of the 

registration statement. 

15 U.S.C. § 77h(d). 

“[T]he essential purpose of [a registration statement] is to protect investors by promoting 

full disclosure of information thought necessary to informed investment decisions.” mPhase 
10

Techs., Inc., Exchange Act Release No. 74187, 2015 SEC LEXIS 398, at *22 (Feb. 2, 2015) 

(internal quotation marks omitted). “Information in a registration statement is material when 

there is a substantial likelihood that a reasonable investor would attach importance to it in 

determining whether to purchase the security in question.” Petrofab Int’l, Inc., Securities Act 

Release No. 6769, 1988 SEC LEXIS 782, at *16 (Apr. 20, 1988) (citing TSC Indus., Inc. v. 

Northway, Inc., 426 U.S. 438, 449 (1976)); see 17 C.F.R. § 230.405 (defining a material fact as 

one to which “there is a substantial likelihood that a reasonable investor would attach importance 

in determining whether to purchase the security”). Respondents’ registration statements contain 

untrue statements of material fact and omit material facts necessary to make the statements not 

misleading in three ways: (1) by failing to disclose the identities of and key information about 

promoters and control persons; (2) by failing to disclose conflicts of interest and related-party 

transactions; and (3) by misrepresenting the nature of their operations. 

1. Promoters and Control Persons

Item 11(n) of Form S-1 requires a registrant to furnish the information required by Item 

404 of Regulation S-K, including the identity of any promoter or control person that the 

registrant had within the last five fiscal years. See Item 11(n) of Form S-1; 17 C.F.R. 

§ 229.404(c)(1). A promoter is defined to include “[a]ny person who, acting alone or in 

conjunction with one or more other persons, directly or indirectly takes initiative in founding and 

organizing the business or enterprise of an issuer.” 17 C.F.R. § 230.405. Control is defined to 

mean “the possession, direct or indirect, of the power to direct or cause the direction of the 

management and policies of a person.” Id.

Go EZ’s registration statement does not disclose that Basilio was its promoter and control 

person, the man pulling the strings in Go EZ’s formation and all of its major transactions. Arc’s 

statement states that Capital Flows is a promoter and incorporated the company. However, 

Lopez admitted that neither of those assertions is true, and that Capital Flows is only an investor 

in Arc. Nova Smart’s registration statement discloses Quintero as a director and officer when he 

is not. It also neglects to disclose Lopez, San, and Xiaoyue, individually and through Arc 

Capital, as promoters, and that Lopez was the primary force behind Nova Smart’s formation. 

These false representations would be material to investors, if nothing else because they 

call into question management’s integrity. See United States v. Hatfield, 724 F. Supp. 2d 321, 

328 (E.D.N.Y. 2010); In re Monster Worldwide, Inc. Sec. Litig., 251 F.R.D. 132, 139 (S.D.N.Y. 

2008). Moreover, both courts and the Commission have held that failure to disclose promoters’

and control persons’ participation in an issuer’s formation, offering, and operations constitutes a 

material omission. See, e.g., SEC v. Fehn, 97 F.3d 1276, 1290 (9th Cir. 1996); Am. Fin. Co., 

Securities Act Release No. 4465, 1962 SEC LEXIS 632, at *5 (Mar. 19, 1962); Hart Oil Corp., 

Securities Act Release No. 4147, 1959 SEC LEXIS 33, at *4-5 (Oct. 9, 1959). 

2. Related Party Transactions

Go EZ’s registration statement fails to disclose the father-son relationship between 

Basilio and Benedict (it fails altogether to disclose Basilio’s involvement), as well as Basilio’s 

prior relationship with Ng, whom he used as a middleman for the FTA and Glophone 

acquisitions. Similarly, Arc did not disclose that its wine partner is owned by Lopez’s father and 
11

that Lopez and Camarero are childhood friends. Both Go EZ’s and Arc’s registration statements 

fail to mention the prior relationships of the former Evotech employees involved in their 

formation and operations. These omissions were material because they allowed Go EZ and Arc 

to depict the transactions as occurring at arm’s length. See Zagami v. Nat. Health Trends Corp., 

540 F. Supp. 2d 705, 708 (N.D. Tex. 2008) (noting that company’s stock decreased more than 

fifteen percent after related-party transactions were disclosed to the public)

3. Nature of Respondents’ Operations

Respondents materially misstated the nature and scope of their businesses in their 

registration statements, affecting the “total mix” of information available to investors. TSC 

Indus. v. Northway, 426 U.S. 438, 449 (1976) (defining materiality). Indeed, “[o]ther than a 

corporation’s financials, its leadership, the nature of its operations, and its plan for the future 

would seem to be the most important pieces of information available to an investor.” SEC v. 

Husain, No. 2:16-cv-3250, 2017 U.S. Dist. LEXIS 29131 at *21-22 (C.D. Cal. Mar. 1, 2017). 

Here, Go EZ grossly overstated the nature of FTA’s operations. FTA is merely 

Benedict’s alter ego company, and has had no customer base at all since its acquisition by Go 

EZ. Moreover, Go EZ has not developed, and has no plans to develop, a “‘Go EZ’ brand 

smartwatch.” As for Glophone, the company abandoned the Miami Beach storefront, which 

Guerra now runs through his own, unrelated company. In addition, Go EZ and Nova Smart 

made numerous misstatements regarding the size and locations of their office spaces. 

Similarly, Arc claimed to operate and enjoy the revenues from 82 Room through an 

agreement with Fanxi. But Yawei independently owns and operates 82 Room and Arc has not 

received revenue from it. Lopez admitted that Arc has no funds and little, if any, assets or 

revenues. While it did make a sale of olive oil, it had no more units to sell. 

B. Failure to Cooperate with Examination

Section 8(e) of the Securities Act empowers the Commission to undertake an 

examination to determine whether a stop order should issue under Section 8(d), and makes 

failure to cooperate with such an examination itself “proper ground for the issuance of a stop 

order.” 15 U.S.C. § 77h(e); see Blimpie Corp. of Am., Securities Act Release No. 5146, 1971 

SEC LEXIS 470 (May 6, 1971) (refusal to cooperate in a Section 8(e) examination “constitutes a 

ground for the issuance of a stop order”). Here, Respondents produced some documents in 

response to subpoenas issued by the Division, but those productions were insufficient. Further, 

Respondents failed to make key personnel available for testimony. 

IV. ORDER

Pursuant to Section 8(d) of the Securities Act of 1933, I ORDER that:

the effectiveness of the registration statement filed by Respondent Go EZ Corporation is 

SUSPENDED;

the effectiveness of the registration statement filed by Respondent Arc Lifestyle Group 

Inc. is SUSPENDED; and 
12

the effectiveness of the registration statement filed by Respondent Nova Smart Solutions 

Inc. is SUSPENDED.

This initial decision shall become effective in accordance with and subject to the 

provisions of Rule 360. See 17 C.F.R. § 201.360. Pursuant to that rule, a party may file a 

petition for review of this initial decision within twenty-one days after service of the initial 

decision. A party may also file a motion to correct a manifest error of fact within ten days of the 

initial decision, pursuant to Rule 111. See 17 C.F.R. § 201.111. If a motion to correct a manifest 

error of fact is filed by a party, then a party shall have twenty-one days to file a petition for 

review from the date of the undersigned’s order resolving such motion to correct a manifest error 

of fact. The initial decision will not become final until the Commission enters an order of 

finality. The Commission will enter an order of finality unless a party files a petition for review 

or motion to correct a manifest error of fact or the Commission determines on its own initiative 

to review the initial decision as to a party. If any of these events occurs, the initial decision shall 

not become final as to that party. 

In addition, a respondent has the right to file a motion to set aside a default within a 

reasonable time, stating the reasons for the failure to appear or defend, and specifying the nature 

of the proposed defense. 17 C.F.R. § 201.155(b). The Commission can set aside a default at any 

time for good cause. Id.

_______________________________

Cameron Elliot

Administrative Law Judge