Even Heroes Can Make Mistakes - Commentary on Gary Weiss
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Posted by: guestblog 1/25/2006 10:33 AM
Gary Weiss is slated to release a book in April of 2006 based on the idea that naked short selling is good for America. However, there are some key points that he seems to have overlooked in his writing.
In a time when immigrants were welcomed to the shores of America but not into the heart of its businesses or policemen, an organization arose called the Mafia. The Mafia’s original intent was to protect the people from what they perceived as anarchy and oppression, to give the streets order by using crime to regulate the daily lives of the population. It was a noble start, yet too soon protection taxes turned to mere taxes, and power corrupted the young men and women involved. The Mafia evolved to the point where when reporter Gary Weiss recently uncovered their actions in the stock market, nothing good could be said about them. But in an interesting juxtaposition, that same author has shown these origins to perhaps hit a bit closer to home than one would think reading his previous work.
“Weiss argues that the indifference of regulators toward small-cap stocks has promoted a lawless Wild West dominated by stock promoters and sleazy underwriters. The only remedy against such ‘bacteria’ is to short these stocks mercilessly.”
This is a quote from the New York Post review on Gary Weiss’s new book “Wall Street versus America”, which focuses on the positive aspects of illegal naked short selling. It is interesting that Weiss has taken it upon himself, in the opinion of the New York Post, to declare rogue justice on the American financial markets. Vigilantes have appeared at many times throughout the centuries, but never to positive effect. The problem that often arises, that without evidence and proper legal proceedings, it is too easy for innocent persons or companies to be punished for something they did not do. Even in the case of persons or companies that are guilty, often mob rule can overstep its bounds and exact vengeance on the guilty party which does not fit the crime.
Gary Weiss is of course an American hero, who, by digging deep under the skin of the American markets has been able to bring things to our attention that previously garnered little to no attention at all. He has uncovered Mafia connections within Wall Street and crusaded against corrupt governments – all of this in an extraordinarily professional manner.
The state has a monopoly on the exercising of both legal force and justice. This is a basic tenant of political science, and refers to the ability of a government to solidify its hold on jurisdiction over its citizens. When the use of vengeance is transferred to those outside of the bureaucracy, this is a sign of a faltering state. When the monopoly starts to break up, instability infiltrates all parts of society. To state that people outside of th
Speaking of media bias, we have a new candidate for "Dumb Ass Financial Journalist of the Year".
And it's only January.
(Should have put the link in my "Comment" field.)
http://www.boston.com/business/a...on_and_markets/
The above was originally posted on the principal website of the Baloney Blitzkrieg-- the fraudulent "anti-naked shorting" movement whose aim is to serve the interests of stock promoters and pump-and-dump scam artists.
What you have here is typical of the propaganda that emanates from that quarter, as it is nonsense built on nonsense. In this case, James has based his entire little mini-essay on a New York Post item about a book that he hasn't read, and even that he manages to get wrong.
He says "it is interesting that Weiss has taken it upon himself, in the opinion of the New York Post, to declare rogue justice on the American financial markets."
That is not "the opinion of the New York Post," and that is not what the book said. My book said that the free markets should be allowed to work to against the scam artists who rip off the public. Since the premise for your entire rant is not true, there really isn't very much else to say. Well, maybe a little more:
The Baloney Blitzkrieg is a single-issue campaign that doesn't give a hoot about anything but making it easier for investors to get ripped off. However, what one often sees on the Street is the mindset that "free markets are great -- except when it is inconvenient." In this instance, the scam artists want the free market to give them the freedom to rip off investors, but they don't want the free market to be allowed to work against their scams.
By the way, my reference to "the above" was the lengthy post from a "James Cummins."
At least James uses his real name, instead of cowering hehind a phony one like whatsisname..... "Bob O'Baloney" I think it is.
I'd say they both deserve to get bitch-slapped as you've done here. Nice.
This guy Cummins is a self-published "poet" who is shopping around for a publisher for a "book" on naked shorting via an Internet "literary agency."
This is the best the stock crooks have to offer? You'd think their bucks could get a more credible hack than this dufus.
Guess you haven't heard that Mark Faulk (a.k.a. "The Faulking Idiot") has been tagged to write a book on CMKM Diamonds.
I guess Cummins and the Baloney Brigade are hiding under their desks. They made a big thing about Cummins posting here and getting into a dialogue with you. Guess they don't want a dialogue after all.
Cummins is being paid by the scamsters to write a book on naked shorting, you know, so I suppose that makes him their chief spokesman. He should come out from under his desk and defend himself. Maybe he can tell you he is wrong and that he knows better than you what is in your book. That's just like the naked shorting nuts for you. They're not called the Baloney Brigade for nothing.
It is interesting to see the lengthy comments that my response has gotten. Especially from two points. The first is that I am not a self-published poet, in fact, I have never self-published anything before in my life. Not enough money. Second, if I was paid by anyone, it sure wasn't the guys at NCANS. I am writing this book with an investor that lost a lot of money due to illegal naked short selling. If anything I have lost money on this project.
The market does not have a right to correct itself via illegal means. No one does, and that is my point. To right a book purely on short selling or naked short selling, the legitimate kind, is one thing. To advocate illegal practices is another.
It is also interesting to hear the harsh rhetoric here that I have been hearing so much about. I do not believe that I have said anything cruel about Mr. Weiss, in fact I complimented him greatly. I admire his work on the Mob on Wall Street, and cited that article in my book.
What I am surprised at is that there has been no talk about, say, Red Sea Management here. I do not name anybody in my book, I only provide the situation at hand in a neutral manner.
The term bitch slap is funny to me, ad hominem arguments are technically removed from most logically coherent pieces. Have you ever met the people in the anti-naked short selling camp? They're broke, they make no money off this, and what's worse they have to suffer through pointless attacks from the other side, people with tons of money and time to make snide comments.
I would love to speak with any of you directly. I am interested to hear both sides and would be willing to answer any questions you have about myself. I find trying to speak to this 'other side of things' slightly frustrating, because all I get is slander. I spoke with one person who was accused of 'being a basher' and, well, found he did curse a lot and got very angry whenever I tried to ask a simple question.
Here are a few for any of you to answer, I'd love to get a response. I see some of you have visited my web page, but none wanted to email me directly, through the email at the bottom of each page. Well, here they are:
1) Why would John O'Quinn, already a billionaire who has pledged his life to helping just causes, state that he would be willing to use up to one hundred million dollars of his own money to trying to solve the 'problem of naked short selling' if it wasn't a problem? He has too much money to 'just be on the take' and is getting nothing out of this but slander thus far. So, why?
2) Why would a former Undersecretary of Commerce, former Prime Minister of Ireland, former Chancellor of Germay and a current US Senator state that naked short selling is a wide spread issue when it is not? These men have already achieved a lot of success, why would they put their reputations on the line for a 'scam'?
3) Why have no significant political leaders ever publicly voiced an opin
I also don't know what you mean by 'they' and 'making a big thing about me posting here'. Someone suggested that it would be good to do, and I felt that if I was going to say something I would say it to Mr. Weiss directly. Just wanted to clear that up to, cheers.
James Cummins
Mr. Cummins, you may want to come back and continue your thoughts, as Haloscan has apparently cut off your comment at the beginning of your point 3.
In the remainder of your response I'd appreciate it if you could be more forthcoming about describing how a person such as yourself, with no financial background, came to write a book about such an esoteric field of finance.
I'm struck by your comment that "if anything I have lost money on this project." You haven't found a publisher yet, so obviously, by definition, it would be impossible for you to have made money on this project. Unless, that is, it is being subsidized. You don't directly address that point, only that if you were being paid, it sure isn't by "the NCANS." That's the National Coalition against Naked Shortselling, which is funded by Patrick Byrne of Overstock Inc.
Incidentally, nobody mentioned NCANS, only you. What is their involvement in your book? Did they ask you to write it, and find you a sponsor for it? What is the name of the "investor" with whom you are writing this book? Is that Patrick Byrne? Is the "investor" subsidizing this book? Is anyone paying you or subsidizing this project?
Yes, the comments on this matter are sometimes shrill, but the ones on this blog are mild compared to the ones I have seen directed against myself and others by some of your associates, sometimes anonymously. Since you seem to have strong feelings on this subject, I am sure you would join me in condemning the pseudonymous "Bob O'Brien" in making slanderous personal attacks on various persons while hiding behind a phony name.
As for your "questions," I'm struck by the pattern of people in the anti-naked-shorting camp making self-serving and unsubstantiated statements then saying, "disprove them." I think the burden is on you to prove your position, and not on others to disprove it. Perhaps you could begin by providing a couple of horror stories of investors in terrific companies who were victimized by naked shorting.
Sorry that my response was cut, I guess I should preview my comments before posting them. In response to your questions:
As for being forthcoming, as a nonfiction writer I do come across many subjects in which I am not immediately an expert in. For this book I took careful planning, interviewed dozens and dozens of experts and hundreds of periodicals. The book is written in a neutral tone, in which I have taken both sides into account. This is my process, and to be sure that everything was accurate after it was written, I was sure to send a copy to several impartial experts in the field to read through the book and tell me if anything needed changing. Dr. James Angel is currently reading the manuscript and has been of great assistance, he takes a very mild stand against naked short selling and believes that if the stock settlement system were corrected the problem of naked short selling would stop almost in its entirety.
As I said before, if it was posted, my job is to take such esoteric subjects and bring them to a level the public can understand. I first came across the subject while dealing with an investor who had lost a lot of money and could not get her shares from the broker. It took her over a year to even get proof of whether or not the shares existed, they did not. The only thing that got the broker to force a buy-in was the NSCC breathing down their backs. I thought it was an interesting issue based on the Elgindy trials and the involvement of DTCC, so I researched further and became involved.
I lose money because I am writing for free, and the time this takes away from other projects is lost money. That is what I mean, and I do not think that it is too abstract for a writer to say that writing for free is often a loss. I hope this clarifies my point, I understand you are skeptical of anyone who voices an opinion that naked short selling must be bad. Please excuse the all inclusive.
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Nobody mentioned NCANS, that is true. Writers on this page mentioned a 'they' and 'them' so I assumed this is what you meant, I apologize if this is off the mark. So far as their involvement, O'Brien has his own book and Faulk does too, though they have not been unhelpful. Their involvement goes as far as an interview with O'Brien in which I got about as much information as anyone else has, a commendation from Ms. Helburn and the publishing of my response to the New York Post review of your book. Asides from that I have had little to no contact with them, asides from some casual emails in which we have debated the accuracy of each others work. As for Dr. Byrne, I highly respect him in his charity efforts and his academic achievements. I have had the honor of speaking to him once over the telephone, that is all. No the investor is not him, nor anyone else significantly involved in this movement. The investor is a victim who lost money, and due to the existence of threats on the lives of people who stand up against naked short selling, something I have personally witnessed, I respect her request for anonymity.
No, no one is subsidizing this book, or my long distance phone calls regarding the book, or the hundreds of hours spent writing and researching the book.
I condemn anyone who is slanderous in this issue and have told this directly to those who have tried, though I do not know them personally. I tell this to the people on this page the same I will say to anyone else, slander and rhetoric is not appropriate in a professional environment. Nor in a blog, though it is common. When Mark Faulk said that Canada was robbing the US blind I stood up to him and he published our dialogue on his web page, I highly respect Mr. Faulk for his work in this field and have since moved far past this incident. As for O'Brien, I have had conversations with him about the proper use of facts, he has helped me getting my numbers accurate and I have helped him. Patch and I have also conversed on the issue of slander, we agree to disagree, in the same way I believe that yourself and I will over the issue of illegal naked short selling. Do know that by condemning people for using slander, I would also be condemning yourself, as you have made baseless accusations against myself on several occassions. All I said about you was that you are advocating something that is illegal in order to correct something else that is illegal and for several reasons I do believe this is a faulty view.
I have answered all of your questions, and I thank you for taking interest. As regards to my questions, I have not made any unsubstantiated claims. John O'Quinn is on record with his pledge of one hundred million dollars. The involvement of top political leaders has been highly publicized, I can send you the articles if you wish from my bibliography. I have not dodged even one of your comments or questions, so I would appreciate it if I could receive the
No, Mr. Cummins, with all due respect you have made nothing but unsubstantiated claims. Frankly that is all that one ever gets from the anti-naked-shorting forces, which is why I call them the Baloney Blitzkrieg in my book. That has been the case for all the many years that this phony non-scandal has been put before the public.
No, it is not unsubstantiated that Mr. O'Quinn has promised to pledge $100 million of his own funds. No, you do not have to prove that he engaged in such grandstanding. I take your word for it. What I don't understand is why you would expect anyone to attach any importance to such a self-serving, grandiose gesture.
I hate to be harsh with you over this, as you seem like a nice fellow and you may very well sincerely believe the things you say. However, any person who has looked into stock fraud -- real as opposed to imaginary stock fraud -- can tell you that there are hundreds of victims coming forward and massive amounts on the public record of genuine stock scams. There are arbitration decisions and lawsuits and, above all, verifiable facts. Real or imagined threats of conspiracies, dark forces, threats and so forth do not prevent the facts from emerging in genuine stock scams. Why do they always seem to prevent people such as yourself from producing substantiation?
You are aware of that, I presume, and I trust you are also aware that supposed "victims" of naked shorting have failed, from time immemorial, to produce any evidence to substantiate their claims.
The only thing that has changed since the 1980s anti-shorting campign is that the "victims" are not even willing to give their names.
Otherwise it is baloney as usual -- unsubstantiated claims and, lately, a bucketload of meaningless statistics that are touted as "data" by some of your friends. Or, in the case of the CEO with whom you had the honor to speak on one occasion, claims of a "Sith Lord" mastermind that give new meaning to the word "ridiculous."
Unfortunately, the anti-shorting forces who are now using your services -- gratis, you say -- would have the public and regulators believe that the problem facing investors is not the pump-and-dump schemes that are an ongoing issue and genuinely concern investors. They want the scarce regulatory resources shifted to an imaginary scandal that works in favor of the perpetrators of those schemes.
To me, that is the crime here -- the waste of regulatory resources and the shift in public attention away from genuine problems that have no voluble CEOs and no websites and high-pressure lobbyists pushing their cause.
I do see your point, in terms of low amounts of regulatory power to go around. Man I really wish this thing would stop cutting off my responses, I did have more. In any case, it doesn't much matter as you are not listening to anything I am saying, and merely coming up with another clever retort. Again I am not sure who you believe is 'using my services'. Is it so hard to believe that someone would be writing a book on their own, don't you? Are you the only one on the planet with the ability or drive? I didn't think so, come on man.
How is O'Quinn grandstanding? The man has taken down far more corrupt organizations than the short sellers ever did, and the short sellers make a far bigger deal over their accomplishments. I believe they are both to be admired. Yes, I said it, short sellers are to be admired for there work. I've never actually said anything different. My problem is with illegal naked short selling, which according to many top intellectuals and authorities is indeed a problem.
In either case I don't really want to debate the issue of naked short selling here. Agree to disagree is always the best course of action. It is interesting that you mention the wasting of regulatory resources as it was the general theme of the one and only Financial Wire article I ever put out. They stopped publishing when I tried to use anonymous sources, their choice I guess.
Again though, unsubstantiated claims is to say something you can't back up. I can back everything I said up perfectly, and will post my sources in a few hours when I am back at my home computer. Just saying that something is unsubstantiated doesn't make it so. I will post my sources here in a few hours when I at my other computer. In the mean time, I thank you for your more polite tone.
The only other things I'll say is this. As a researcher into the Mob, you should have learned by now that very little of what it does is ever proven. They cover their tracks very well. That is the difference between typical pump and dump and high level hedge fund naked short selling. One is street level, one is not. I have evidence of this and am willing to share it with you through a less public forum if you wish. For now, I will just post my sources. Thank you for your time as always, I enjoy speaking with you.
James
James, what I have been trying to do, without success, is to focus this discussion on reality -- the real problems allegedly suffered by real victims of naked short-selling. If you haven't produced this evidence it is really no fault of mine.
As for my "not listening" or mistreating you or whatever -- James, you decided to post here of your own volition, and I was more than happy to allow you, even though I thought your post was unfair as I indicated. That's because you sign your posts with your real name and because you refrain from the conspiracy theories and personal abuse utilized by some of your fellow anti-shorting types. Although what I described in the last sentence is standard practice in most of the world, it is unique and refreshing in the world of short-bashing.
Though I'm more than happy to let you post here as much as you wish, this discussion will get nowhere until you show me real victims of naked shorting. Now, that is how frauds are proven in the real world, and that has not been done by the anti-shorting community in their "naked shorting" polemics since both you and even I were mere toddlers. Instead we get the baloney that is the norm among the anti-shorting crusaders.
This will take up several slots, I hope you do not mind:
Well I agree with what you say. Short bashers though, I do not tend to lump myself in with them when I say straight out that short sellers are required and necessary. They do good work bringing down bad companies, on the most part.
I apologize again if you feel my postings are unfair, we are attacking the same issue from different sides and are bound to clash at some point. If what you want is basic stories about people who were screwed by naked short sellers, I will provide them and them only unless you wish to hear about other things. I agree that this should stay on the ground.
Dr. Richard Simpson of Zanncorp is perhaps the investor who got the most press. His story was misreported by FinancialWire and Senator Bennett though when it was brought up in session. Simpson wanted to know if naked short selling was real and didn't think it was. He figured that if people were right he would be able to pick a stock at random on the little boards and be able to witness it first hand if any of it was true. So he called up his broker and asked arbitrarily for his broker to purchase him $5000 of shares in Global Links.
continued...
Little did he know that at the stock price he bought the shares at, the five thousand dollars bought him over 100% of the company. Upon realizing this, Simpson began to panic. He called the SEC and filed a report, but the SEC put him under investigation for mentioning to them he owned more than 100% of the stock. Funny thing was, another 100 million shares or so were traded after Simpson had acquired his, as he held on to his own.
People say that those who complain about naked short sellers are just whining investors. Well, Simpson had nothing to whine about. The price fluctuations due to the extremely high number of phantom shares caused his investment to soon be worth nearly two hundred thousand dollars. In my conversation with him, he has refused to do so based on the principle. His own company was victim to naked short selling according to him, and he didn't want to do to others what was being done to him. Instead of turning an unfair profit, Simpson has paid over ten grand in SEC filings over the shares. In addition, the broker who bought the shares could not prove to Simpson that the shares were in his account, because after months and months the trade still hadn't settled. This is one consequence of naked short selling.
Another story is that of Rod Young. There was a reason why he was the only thing left in the Dateline piece, because his story is irrefutable. This is just a young construction contractor who invented a way to forward his calls from his office on the job. Employers and clients kept asking him where he bought it, he told them he had made it himself and they encouraged him to start marketing it. Five years later he was living a dream, the product was about to come out and was working steadily. However, naked short sellers entered the scene through a toxic financing deal and started bashing the company. They claimed it had no product, in reality he'd had a product for years, it just wasn't on the market yet. They fabricated lies about the company's finances, and eventually plowed it into the ground. Today, Young just wants to get his shareholders their money back. He doesn't seek retribution, he just wants to run his little dream company and the naked short sellers are relentless. This was not a bad company, it just fell under the aims of bad traders.
continued...
Then there is Dr. Albert Reynolds, former Prime Minister of Ireland. In 2003, his company Life Energy Technologies was purportedly naked shorted nearly out of existence. His response to this was reported in a May 18, 2003 OTC Journal article, “Dr. Reynolds has been lobbying ferociously on Capitol Hill for legislative change, along with former US Senator Vance Hartke who has take up the cause. Here is a quote from Dr. Reynolds taken from a recent press release: ‘From what I can observe, the trading system in America allows for abusive trading practices to over inflate share ownership in a U.S. Public Company. The 3-day settlement securities clearing system operated by the NSCC and DTC fails to operate correctly to ensure that a fair marketplace exists to trade U.S. Public securities.
“A few market makers and brokers are determining the value of a company and not the legitimate buyer of the securities. The U.S. has been faced this last year with much corporate misconduct, but have not faced the fact that the U.S. Trading System lacks integrity. If these practices are not fixed, it will destroy the next generation of business in the United States. Who is to say that the OTC-BB market is down over 75%; how much is the economy how much damaged has been caused by unscrupulous market makers and brokers. What happens when the World Markets realize that short sellers can sell you securities, never deliver them, and collect the money? You would have to ask yourself why anyone should invest in American Companies’”
I have first hand reports of many others, but I do not want to inundate your blog. Is this the kind of evidence you were looking for? Let me know if it is not, I can find something that better suits your question. Thanks as always,
James
Another trader in Florida who is now working alongside the government in trying to bring the larger naked short selling cartels to justice had a similar experience. The man will have to remain anonymous here, but this is his story. He brought down Elgindy by having his secretaries copy every page on Elgindy's private site for years. He has been planted in Red Sea Management seminars and recorded the manager of the company stating that he uses naked short selling to kill small companies and would kill anyone in the room who ever spread the news. That manager is Jonathan Curshen, an American who was trained as a broker in Vancouver before eventually seeking diplomatic status in Costa Rica - which he has been granted. His offices are on the top two floors of the Israeli embassy in Costa Rica and his body guard is the head of security for the embassy. He has risked his life to help government agencies gather evidence on the cartels, this is another consequence of naked short selling.
My coauthor specifically invested in JAG Media. The company had signed major advertising contracts and employed over 300 people. They had a great business plan that was going to rival the other cable news networks. However, after a death spiral financing deal, they were under sustained attacks by the naked short sellers. The advertisers pulled out because of the sustained attack, telling JAG this was the only reason, but it was a good one. The trash talk and lies of the bashers left the company too risky to invest in. After the advertisers left, so did the investors and the company has had to downsize significantly. It is still around though, waiting for the naked shorts to relent, doing business quite well but under the constraints of greed driven scrutiny.
Robert Shapiro, Sedona was his baby after leaving his position as undersecretary of commerce under Bill Clinton. He worked hard to get the company on its feet, but again encountered toxic financing. They started shorting before they even finished the deal. There are tape recorded conversations of brokers congradulating one another on destroying the company despite its merits. The Baidans who drove the naked shorting of the company were arrested, one fled the country. All the while Shapiro was forced to deal with the manipulators first hand that he had once seen only from on high.
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02.02.06 - 11:50 pm
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It's obvious the Baloney Brigade has no experience with securities fraud, apparently including the oft cited but so-far unpublished "expert" in naked shortselling Dr. Jim DeCosta. According to SanityCheck blogger BBurrell: "He has been a consulting expert on some of the most important older cases in the space, including the critical Amazon Natural Treasures. Companies who have been victimized have used him and his materials to mount their defenses to the continuously mutating attacks on them..." http://www.thesanitycheck.com/Bo...54/
Default.aspx
As it turns out, Dr. Jim owned 50,000 shares of Amazon Natural Treasures (AZNT) ( see: http://www.siliconinvestor.com/r...?
msgid=16173486 ), so he obviously can't be considered a neutral party here. Unless, of course, he was paid in stock, which would make him a hired gun rather than a concerned individual.
So what was AZNT you ask? Here's a snippet from Jason Anders' piece on the company in the Wall Street Journal:
"Beginning in 1997, the company issued press releases trumpeting its innovations, including a 'cream protection against AIDS,' a chewing gum that can be used in place of brushing teeth and a scalp cleanser that cures baldness. Mr. Sylver says the company can't afford to produce and distribute those products and others because of the cybersmear campaign." ( see: http://www.siliconinvestor.com/r...?
msgid=12851462 )
Believe me, it gets worse.
When I first encountered the company their IR guy was John Fasano. Fasano subsequently was sentenced to 37 months in prison for the manipulation of Spaceplex International Amusement Centers stock ( see: http://caselaw.lp.findlaw.com/sc...01006v2&
exact=1 ). The CEO was Mike Sylver, who the SEC nailed for "antifraud, bookkeeping, internal controls, reporting and securities registration violations... also sold millions of shares of stock to the public in unregistered, non-exempt transactions." ( see: http://www.sec.gov/litigation/li...ses/
lr18398.htm ). Many of these shares were sold through a boiler room named Wellrich which has since been shut down.
Sylver maintained an account at Creative Capital, a company owned by George Doumanis. Doumanis was "sentenced to 14 months in prison, to be followed by two years of supervised release" for his role in attempting to conspire with a mutual fund to manipulate the price of the stock of Integrated Homes ( INHI; see: http://www.bizjournals.com/south.../15/
daily4.html ). Doumanis arranged financing for AZNT through Joseph Andy Mann who was later arrested and "accused of participating in a racketeering enterprise with members and associates of five mafia organizations, including the Bonnano and Colombo crime families." ( see: http://www.bizjournals.com/south.../15/
daily4.html ).
Yet, of course, all the company's woes were the result of evil message b
James, your stories are anecdotal and thus filled with inaccuracies. IMO, no publisher would dare print anything unsubstantiated that could open themselves up to a libel suit. For a convincing debunking of some of your examples, e.g. Zann Corp, see: http://nakedshortlie.blogspot.com/
- Jeff
James, we're really getting nowhere with this discussion. Apart from Sedona, which is the only case of naked shorting mentioned in the Regulation SHO rulemaking, all you have are the same tired examples that have made the rounds of the naked shorting websites for aeons and are, again, just unsubstantiated allegations.
What is substantiation? It means something more than a CEO or an investor blaming naked shorting and more than an OTC tip sheet reporting that a company was "purportedly" the subject of naked shorting.
"Life Energy Technologies" is Life Energy & Technology Holdings Inc. But then again I can't expect you to get the name right when you've obviously don't know the first thing about this company, and in fact you just lifted that portion of your missive verbatim from the OTC Journal article you quoted (or actually its web version at http://ioreport.com/archive/list...0030518-1.html)
James, it is a mistake to rely on OTC Journal or other secondary sources for your information. What you need to do is to go through the companies' filings and talk to investors. A cursory examination of the SEC Edgar record would show you that this company is a thinly traded OTC Bulletin Board company that has any number of legitimate reasons for a stock price decline -- such as having a balance sheet back in the early part of this decade that reminds me of my grandmother's Sunday night card game. It is now operating under a different name and I wish it well.
Likewise, JAG Holdings is an another tired mainstay of the naked shorting circuit. Its longtime CEO, a major anti-shorter, was just the subject of an SEC action for allegedly selling unregisterd securities.
Eagletech, the Rod Young company, was a Mob stock manipulation (with Rod Young not implicated, I hasten to add). Again, a little digging would have gotten you that information. Eagletech was a classic pump-and-dump.
So no, you did not substantiate your point and, candidly, I doubt very much that this discussion is going to result in your doing so.
For the sake of completeness, here's the remainder of my post about AZNT:
Yet, of course, all the company's woes were the result of evil message board bashers -- who conspired with the DTC -- to use counterfeit shares to drive the company into the ground.
And somehow, despite all this arrests and convictions of company insiders, we are supposed to believe that AZNT is a seminal case in the history of proving the existence of naked shortselling?!!!
Oy.
- Jeff
As for Rod Young, I do take Dateline's and Euromoney's, and Forbes' too, version of events, alongside Rod's himself, over what you have simply stated without backing up. I do appreciate your comments and will fact check them, if I find evidence for you to use for these comments in the future I be sure to let you know.
You cannot refute Red Sea Management's role because you have not talked to the very few people on the inside that know the full details. I have and have shared with you some of what I know.
Thank you very much for conversing with me, I do appreciate it. It appears we simply reside on different sides of the fence. I am not saying yours is wrong, or that mine is wrong, but I have yet to hear any evidence from your side. I look forward to reading your book and further hearing what you have to say about the issue.
The only other thing I will say is that my coauthor's problem, the major problem for her, is that when she asks her broker for proof any of her stock was ever settled, she is told it never was. She was able to vote on these stocks, as were the other owners of the exact same shares. The other owners were able to sell the exact same shares, and it wouldn't even be a problem if it would have taken less than a full year to see actual shares existing in her account. I have not met many people that have not had similar encounters with their brokers, and these are the biggest brokers in the business. It is not that some people have had this problem, it is few I have spoken to haven't. I advise you to check you own stocks to make sure they are safe.
continued...
James, please. Do you mean to tell me that I have to tell you -- an author of a book about naked shorting -- about the widely publicized public record concerning Eagletech Communications? Are you going to seriously pretend that you are not aware of its SEC troubles and the criminal actions involving stock promoters who pumped and dumped the firm's shares? And that nowhere in the voluminous public record is short-selling of any kind even mentioned?
No, the CEO (Rod Young) was not implicated in these schemes. Again, anyone familiar with stock fraud would be aware that that is not unusual in stock scams.
It's very hard for me to get involved in a useful discussion with you on this, James, because though you are a nice fellow you seem to be parroting the pap of the Baloney Brigade without any serious attempt at independent research.
It's a little embarassing to read this exchange. Cummins doesn't have the slightest idea of what he is talking about. It is as if he is brainwashed by the anti-shorters and reciting rote polemics like a catechism. The "tell" is that he turns a blind eye to the fraud of the "victims" he trots out -- an old con.
He also is employing one of the tested tactics of your "Baloney Blitzkrieg" which is to swamp your blog with long winded and unresponsive posts.
Over a trillion individual shares exist in CMKX Diamonds, almost all of which are phantom shares. Do you not see this as a problem? Or investors buying something that is not delivered even after a year of requests? Is that not a problem at all for you?
The SEC has stated in the past just what you seem to say, that naked short selling counteracts the pump and dump. Which was true ten years ago, before people inside the SEC started reporting large hedge funds using illegal naked short selling as part of their business model. It has grown beyond the old version you believe it continues to be, and that is according to people inside the SEC itself.
My book in the end is about helping investors to know what is out there and what can happen to their portfolio if they are not looking. I do not advise any major political movements or regulatory shifts, merely that investors keep a closer eye on their investments. That is all I believe can be done at this point, investor awareness needs to be heightened. I do not believe it is wrong to tell investors that it is right to check up on their own life savings. I do not believe you think it's wrong either.
I thank you again for your guidance, and will go forward with your beliefs in mind. I wish you luck with your book and am sure it will be a success. Thank you also to Mr. Mitchell, I appreciate your added research into Dr. DeCosta, I will check this as well. I am sorry you feel that we have gotten nowhere in the discussion, I do disagree. There is a divide among those who want good things for the American markets, one day I hope it can be bridged.
It's CMKM Diamonds. Yes, I think the "phantom share" claims are the usual red herring. Yes, I think the shrieking about that is designed to divert attention from the company's real problems, as are set forth in the voluminous SEC record that you are pretending doesn't exist.
Dr. Jim DeCosta has only one book, and it is but self-published. However, dozens of companies have felt it was right to utilize this text through DeCosta's firm to help them stay afloat in the face of manipulation. I have heard first hand of JAG's CEOs' recent troubles, yet they do not apply to what happened to the company four years ago, you are confusing two different issues. I am glad you do not refute the Sedona case, but feel that you must not have a very keen sense of right and wrong if all you make a call on is something a judge has said. There is more to the world than the judicial system.
As for Rod Young, I will post your comments to him and await his own personal reply, he will defend his situation against your accusations far better than I. To say that only one company is reported in SHO is to say that unless something was a part of that discussion it is not relevant. Sadly that is not the case.
I find that you miss my point all too often, choose to pose questions without answering them because you say you do not like the answers you are given. You did not answer the story of Simpson and his investing issues, you tried to bring Zanncorp in, which I never made a central issue in my comment.
Aside from the Dr. Reynolds story, all others I have garnered first hand from the individuals. You simply ignored the Florida man and the proof he garnered for your government which is looking into the issue very closely. I do also think that Dr. Reynolds, as a former head of state, is intelligent enough to know what happens in his own business and life.
continued...
Yes, please do relay back to me Mr. Young's take on the pump and dump of his stock, and ask him to please explain why the SEC and federal prosecutors found no evidence of naked shorting in all of their massive investigations.
No, James, what you are posting here is the same old baloney. If you have personal horror stories that are not a repetition of the same old line, please post feel free to post them. Please do not clog my blog with second-hand clips from this or that website or OTC Journal because it's just the same old baloney. We don't need that.
We are indeed talking past each other because I am trying to find some real fraud here, some real investor harm and you just keep repeating the Baloney line that you have been fed.
As to your latest, insulting tantrum, which no I am not going to post, I regret that I have delayed posting your lengthy and repetitious and unresponsive posts. However, no, I have not "censored" you and if you are cut off in mid-ramble it is because of Haloscan and not myself. What I have done is to repost your posts, verbatim and without removing a word, in a way so that I can respond to each post individually.
Incidentally, it is "tu quoque" and not "tu quo quo." But again, your wrong under both spellings. What you keep ignoring is the character of the companies that are alleging naked shorting. Pointing that out, and the tendency of penny stock promoters and penny stock cos. to scream "naked shorting," is not engaging in tu quoque. Particularly when there is only scant evidence of naked shorting taking place in such instances.
If you do plan to write a book on this and ever find a publisher, I do hope that you escape the clutches of the Baloney Brigade and not just produce another anti-shorting screed as appears to be your current intent.
One other additional comments. I have read what 'bashers' have to say on the message boards, and it does not contribute to any debate whatsoever. The language used is beyond reprehesible and no professional would ever use it. Criticism is great, doesn't even have to be constructive in my view, but ad hominem is something else entirely. ]
Begging the question is another favorite amongst that crowd I find, and I dare say that tu quo quo arguments also show up regularly. Responses such as these do not contribute to dialogue, they cannot for they are logically fallacious. I have never heard so much talk about bleeding from the rectum in my life, and don't plan to.
If you want to condemn something, Bob O'Brien has never held a candle to what these people write in terms of abuse. And to think that these are the people who are running the economy, or at least trying to in any case. Wow.
Well, the rhetoric on both sides is heated. However, obviously you haven't read the "Bob O'Brien" website, or his vicious attacks on people while he bravely hides behind a phony name.
Again, thank you again for contributing, James. If you have a comment to make with new and not retread observations, and can show other users of this board the courtesy of keeping it at reasonable length, I would be delighted to hear your views needless to say -- since, as I indicated earlier, you do indeed use a real name, unlike some of your compatriots in the Baloney Brigade.
>Criticism is great, doesn't even >have to be constructive in my view, >but ad hominem is something else >entirely.
Yeah, and Bob O'Baloney wouldn't dream of an ad hominem.
Your credibility is gone now, you realize that Jimmy?
Cummins is so out to lunch that he quotes without hesitation from a noted stock fraudster:
OTC JOURNAL PRESIDENT LARRY ISEN A/K/A LAWRENCE D. ISEN.
C. Isen is a resident of San Diego, California. He was employed by Cohig as a registered representative in its Solana Beach office from approximately November 1991 to May 1995.
D. From at least September 1992 through February 1993, Isen willfully violated Section 17(a) of the Securities Act, Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, in that he, directly or indirectly, in connection with the offer, purchase or sale of certain securities, by use of the means or instrumentalities of interstate commerce and by use of the mails, employed devices, schemes, or artifices to defraud, obtained money and property by means of, and made, untrue statements of material fact and omitted to state material facts necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading, and engaged in transactions, acts, practices, or courses of business which would and did operate as a fraud or deceit upon purchasers of such securities.
1. As part of the aforesaid conduct, Isen, while a registered representative at Cohig, received undisclosed payments, directly and indirectly, from persons controlling or otherwise affiliated with Eagle, in return for selling Eagle stock to investors.
E. On November 16, 2000, Isen was convicted by the United States District Court for the Southern District of New York of one count of conspiracy to commit securities fraud and wire fraud based upon his receipt of undisclosed payments for selling Eagle stock (U.S. v. Isen, Case No. S2-98-Cr. 207 (RPP)(S.D.N.Y.).
UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION
Securities Act of 1933
Release No. 8044 / December 19, 2001
Securities Exchange Act of 1934
Release No. 45172 / December 19, 2001
Administrative Proceeding
File No. 3-9187
--------------------------------------------------
------------------------------
In the Matter of
CARMEL EQUITY PARTNERS,
ET AL.
--------------------------------------------------
------------------------------
:
:
:
:
:
:
:
ORDER MAKING FINDINGS AND IMPOSING REMEDIAL SANCTIONS AND CEASE-AND-DESIST ORDER AGAINST RESPONDENT LAWRENCE D. ISEN
I.
The Securities and Exchange Commission ("Commission") instituted public administrative and cease-and-desist proceedings pursuant to Section 8A of the Securities Act of 1933 ("Securities Act"), and Sections 15(b), 19(h) and 21C of the Securities Exchange Act of 1934 ("Exchange Act") in this matter on November 18, 1996.1 Respondent Lawrence D. Isen ("Isen") has submitted an Offer of Settlement ("Offer") which the Commission has determined to accept.
Solely for the purpose of these proceedings and any other proceedings brought by or on behalf of the Commission or in which the Commission is a party, and without admitting
CMKX: More Cummins baloney. He really is a puppet of the naked-shorting loons. See this:
"It appears that approximately 800 Million shares of CMKX stock were reported to the DTCC (Depository Trust and Clearing Corp.) as delivery failures in the month of April of 2005," Mr. Frizzell advised the Owners Group members.
At best, that indicates that Mr. Frizzell has some proficiency in adding and rounding, but it does not indicate that he has a clue about the significance of the delivery failure data provided by the SEC.
Setting aside the observation that not all delivery failures necessarily represent naked short sales, simply adding up running totals of the delivery failures for a month to arrive at approximately 800 million shares while disregarding any intervening settlements of those transient failures does not really provide any meaningful information.
What is meaningful and certainly significant with respect to any claim about naked shorting is that the delivery failures topped out at approximately 186 million shares on April 22, a trifling amount for a company with 703.5 billion shares outstanding. Further, even that insignificant number of FAILS was settled by April 26.
FROM STOCKWATCH.COM
CMKM massive short story debunked, fantasy continues
2005-11-11 20:52 ET - Street Wire
See Street Wire (U-CMKX) CMKM Diamonds Inc
by Lee M. Webb
CMKM Diamonds Inc.'s liquidating "task force" is actively perpetuating the notion of a massive naked short position in the recently revoked pink sheet promotion headed by Saskatchewan native Urban Casavant. That tale plays well among CMKM's cult-like followers, but trading data debunks the story.
CMKM's vaunted task force consists of the company's former trophy co-chairman, 87-year-old Robert Maheu, its legal counsel, Donald Stoecklein and Texas lawyer Bill Frizzell, who represents approximately 2,500 shareholders.
As disclosed in an Oct. 24 filing with the U.S. Securities and Exchange Commission (SEC), the task force will oversee a liquidating distribution of CMKM's assets as Mr. Casavant winds up the company. CMKM has tens of thousands of shareholders and a staggering 703.5 billion shares outstanding.
According to the Oct. 24 SEC filing, CMKM's assets consist of 50 million shares of Vancouver-based Entourage Mining Ltd., a financially challenged OTC Bulletin Board company flagged with a going concern warning. The Entourage shares are reportedly being swapped for CMKM's Saskatchewan mining interests.
Interestingly, Mr. Casavant's business associate Emerson Koch of Tuxford, Sask., is rather magnanimously contributing 30 million of the 50 million Entourage shares slated for distribution to CMKM shareholders.
The 50 million Entourage shares have not yet been issued and the Vancouver company has not even announced that the deals involving CMKM have been consummated. Nonetheless, the task force is already pressing ahead with the dubious liquidation plan.
S
Good to know the bashers inhabit this site too.
Well, they are not what you want to read -- but they are factual, James. Sorry.
The trillion dollar number from CMKX comes from the total number of phantom shares recorded in the company over time, all I am saying is that a ripped off investor should have the right to restitution. Whether it is a pump and dump or naked short selling scandal, the discoverers should take their evidence to the SEC, if it is so strong, and have the company closed down. Then the investors can recover some of their losses in court. Simply shorting a company into the ground may cure the problem, but there are two problems. The first is that there is no guarantee their evidence would have stood up in court to the point the company would have closed. The second is that the investors do not have any chance to make back their money through the court system. And there was money to be had, it just ends up in the short sellers' pockets instead of being recouped by investors.
Is this legal? Sometimes. My comment about the bashers was out of line and I apologize. Really I just want to know what you think about this issue of restitution, which I had tried to post at the end of a bunch of other posts but it kept getting cut off by Halo.
Again you're showing that you don't know what you're talking about.
You say, "Whether it is a pump and dump or naked short selling scandal, the discoverers should take their evidence to the SEC, if it is so strong, and have the company closed down."
All you're showing by saying things like this is that you don't have the slightest idea how the regulatory process works. The SEC doesn't "shut companies down." However, it can act in extreme circumstances against the registration of a company's stock. That is already happening. It is absurd to trot out CMKM as a poster child for the anti-naked shorting crusade. However, you and your pals in the Baloney Brigade aren't in the least interested in whether a company is sound or a pile of dung. As long as it screams "naked shorting" it is grasped to your bosom.
You keep trotting out that phony "trillion shares" number. It was already explained, in one of the posts you dismissed as "bashing," that this is a meaningless number that comes from toting up cumulative fails to deliver without taking settlements into account. Fails are not unusual in OTC companies as has been pointed out by the OTCBB people many times, not that you and the Baloney Brigade give a damn.
As for being "shorted into the ground," again you're just reciting the rote phrases of the Baloney Brigade, which is cynically exploiting the fact that stock rigs invariably fall "to the ground."
It seems to me that if you were serious about stock market reform (and you are not, but I am pretending you are for the sake of argument), you would focus on genuine investor issues like an unfair arbitration system, and not let yourself be used by the Baloney Brigage to write about things you clearly know nothing about.
And you would notice that everything you say has the pawns of the Russian mob jumping for joy. Seriously. Tell me one cent that you can prove the 'Baloney brigade' has made off this issue. Now tell me one person that you have aligned with that isn't making a killing. One side is in it for the investors, the other for the investment. And make sure your new book has an index so people can check your sources this time.
"Now tell me one person that you have aligned with that isn't making a killing."
Yes, you caught me, James. Go to the Introduction of my book, which posted as a link to my website, www.gary-weiss.com, and you can see the story of one of the persons cashing in from the publication of Wall Street Versus America.
The Introduction focuses on a small investor who was caught in the vise of something you don't know about and don't care about called "securities arbitration." He's made out like a bandit! Really profited, and he's happy as a clam. Oops! I'm giving away the ending.
Really, you ought to get ahold of the book in April -- and yes it does have an index to spare you the need to actually read it. You can see how that investor was showered in riches and how Merrill Lynch was reduced to penury by that fellow. Really suffering -- and all because I wrote about him!
James, you've been hanging around the Baloney Brigade, with its charlatans, crooks and stock-hustlers, far too long. You are not only spewing their baloney and shilling for their silly cause, but are adopting their stance on ethics as well. Basically their view is "since I am an unprincipled liar and con artist, so is everyone else."
I see that James has crawled away, never to be heard from again.
Compare the full hearing you gave Cummins to how Bob O'Brien treats differing opinions in his "Sanity Check" blog.
He relegates people who diagree with his dogma to a separate section he calls "Doggerel," with one user's comment put in a discussion group he calls "feces."
A fail "could" happen because of a whole bunch of things aside from naked shorting
====================
It could ... but, the vast preponderance of, shall we say, circumstantial evidence says, in many cases, it is naked shorting.
Talk about drivel. It's apparent you're not stupid ... so, the explanation has to be you are a short shill.
What would be so hard about cleaning up the SHO list???? How about releasing the names & number of shares, and length of time on the list of the "list members".
Say, what do you suppose the reasons are for NFI & OSTK being on the list for over a year???? Huh?
Say, here's a new addition ... SFCC. 93% of their float is short & they made the list in December ... in the midst of an attack by Third Point.
Again, why aren't the volumes & names of the FTD shorts published? Why aren't the FTD positions resolved on a timely basis?
I can hardly wait for this situation to come to a head & burst. There's gonna be an awful lot of NYC semites populating the Federal prisons. You may be doing a perp walk, in a orange jumpsuit, yourself. The pimple is festering ... and, many people want answers & a resolution to this mess. It's not going away!
I apologize for the anyone who might be offended by the above post's anti-Semitic content.
However, I decided to let it to go through because this is actually a mild version of some of the reaction that I've gotten from the anti-shorting conspiracy whackos. Obscene, racist, anti-Semitic rants are the norm, not the exception.
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