"Poor poor investors" From: Tom Megas
To: jacob.bunge@dowjones.com
Cc: thomas megas Megas
Sent: Saturday, May 30, 2009 4:01:14 PM
Subject: dtc
Dear Jacob,
As a CEO of what was a fully compliant OTC company destroyed by the DTC: I can
vouch first hand of the need for a second clearing system.
In 2005, BCIT was a sleepy shell of which I was and still am the CEO and
majority shareholder president. Earlier in that year a group of fraudsters
printed fraudulent certificates and presented them for clearing to the DTC, who
did not do their due diligence and allowed these fraudulent shares into their
clearing system. Hundreds of millions of these shares were sold in the market
place as a result of a vigorous publicity campaign; by those purporting to be
representatives of the company. It was the equivalent of credit card identity
fraud. The SEC were informed , the DTC were informed and they did nothing for
months despite my public statements that the brokers and the DTC were now
complicit in a massive fraud as a result of the internal failure of the due
diligence systems of the DTC and the total lack of initial interest of the SEC.
When the brokers realized there was a problem instead of stopping they mounted
a massive sales program knowing that the shares would be ultimately suspended
and therefore would not have to deliver any shares because of the stop in
trading. It also meant the money they took from the retail purchasers was money
for nothing. The brokers sold around 2 billion shares short knowing they would
not have to deliver and the poor investors got nothing for their money.
As a consequence I took the fraudsters to court and won a case against them and
got some damages. With this money I brought the filings up to date with the SEC
who accepted our filings and the sanctity of our stock register (i.e. only
those entities on the stock register had shares, we then filed with FINRA a 15c
211 which cleared us to trade again). The SEC said we were fully cleared to
trade again. However, the DTC told us we could not trade unless we made good on
all the bad shares they had let into the system (which also meant giving
brokers free stock for all their short sales). I refused, and as a result my
company is being delisted by the SEC.
This situation has occurred because the DTC has a monopoly and is answerable to
no one, not even Congress or the SEC; since they are staffed by ex SEC people
and or from the major broker firms. Mr. Goldstein is lying and I am prepared to
say so publicly. Lying cynically as his organization continues to bilk the
retail investor in collusion with the major brokers of billions of dollars from
the American public. If this is not a case of systemic failure I do not know
what is. I wish you would give my comments a public platform as I would love to
be sued by Goldstein as he continues to commit fraud in all his public
statements.
What appalls me is the confident arrogance with which he and his organization
lie based on the fact that he represents a monopoly that is effectively
answerable to no one.
Bring on the competition.
Best regards,
Thomas Megas
CEO & Chairman
Energy Source Inc (formerly BCIT)
SLUMDOG 
