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Sadly, you are so right.
It seems the forward split plays to buy are the ones where TRADERS have made the mistake. If the mistake has been made by insiders, MMs or brokers and they are at risk the stock always seems to get screwed. On the other hand, let an investor make a mistake and the stock will turn and go to the moon.
As I've said numerous times, ain't no way I'm advising the SEC of anything while I own it, not again, no more...even when they, NASD and everyone else agrees we are right, they screw us in the end.
It seems the SEC's suspension of the net capital rule is being used to allow the crooks off the hook in the market place as well.
Makes one wonder who is the bigger crook.
I agree with you on teh need for more complete disclosure.
A complete disclosure of everyone involved should be forthcoming.
It is totally inadequate to simply state so many shares were directed to his account and 2.5M to 20 people's accounts.
Because of the magnitude of this and in the
I wonder if thru the freedom of information act one could gain information on who the 20 people were, who the broker was, etc.
I have always wondered if AT wasn't the broker since they were allowing people to sell
Typical SEC slap on the wrist for the real bad guys, but Martha, well that's headlines.
I wouldn't assume that in absence of facts. The whole idea was to scam under the radar and hope nobody noticed, shift blame, etc. They tried to foist a few trillion shares to cover their tracks. Oops... That didn't fly low, either.
I want to know what broker cooperated with the company after they screwed up. may never know, but that would be good stuff.
The TA we know...and his broker... name names
assumming you dont sell the company 16000 times LOL
In this case extreme circumstances apply.
What should be done is to cause the resolution to be settled in the market place.
The SEC has stepped in here as an agent to protect insiderSSSSSSSS, (notice that was plural), MMsssssssssssssss, (again plural), and BrokerSSSSSSSSSSSSSSSSSSS (again plural).
Their suspension of the stock, in combination with the suspension of the Net Capital rule caused a fair market place to not exist.
The slap of the wrist of one of the insiders who sold is only cosmetic so they can say they did something.
HOW OUTRAGEOUS THAT THEY NEVER EVEN DISGORGED ALL OF THE MONEY FROM THE STOCK SELLS!
I am assumming the company would not overstate the number of shares that insiders had sold. If they lied it would be to understate the amount.
Should have done TEN years in JAIL as well- Grand Theft.
It's not too late for the State of Florida to press charges or bring a civil suit, if they want to do that.
And I think damages for fraud are treble (3x), not 10x.
Yes....I missed that the first time round...
He settled already huh?
You are assuming then that the company didn't lie in the press release.
The original complain detailed the 2.5M shares he ordered sent to 20 people, I did assume they were friends. Perhaps he sent those shares to enemies.
The MMs were short as well. But, we know for a fact that an additional 118,000+ shares were sold by insiders per public PRs.
We know this to be true that an additional 118,500 shares were sold due to a company PR that stated that 138,000 shares were sold by company insiders.
Either their PR was a lie or insiders sold an additional 118,500 shares. Those insiders should be held accountable as well.
The $20,000 profit should be returned as well.
The fine should have been by a factor of TEN times the fraud committed. He should have been on the hook to pay TWO MILLION bucks.
Why does the SEC believe they will deter this behavior when they reward those involved with financial gains and ABSOLUTELY NO punishment?
Should have done TEN years in JAIL as well- Grand Theft.
Was that disclosed in the complaint or in the administrative order - that his "friends" sold shares, too?
It's easy enough to assume that, but do we know it to be true?
Think: if you think his friends were the only ones on the other side of the trade, that wrecks the "MMs were too short to cover, ever" theory, Bill.
They even let him keep $20,000 of the profit before his petty trivial fine. Meanwhile, his buddies who sold the other 118,000 got to keep all of their gains. Who is guilty of FRAUD here- Peter or the SEC?
Kirschner was directed to disgorge $109,400 in ill-gotten gains
Kirschner sold 19,500 of these prematurely-received, post-dividend shares
to unwitting market participants at prices ranging from $5.50 to $7.95 per share, realizing proceeds
of $139,400
According to the complaint, had Kirschner sold the same quantity of shares hours
later, he would have realized gross proceeds of less than $20
Neither Texas US Senator on any of these committees. I'll write Kay Bailey Hutchison anyway.
Securities and Investment
Chuck Hagel Chairman (R-NE) Christopher J. Dodd Ranking Member (D-CT)
Michael B. Enzi (R-WY) Tim Johnson (D-SD)
John E. Sununu (R-NH) Jack Reed (D-RI)
Mel Martinez (R-FL) Charles E. Schumer (D-NY)
Robert F. Bennett (R-UT) Evan Bayh (D-IN)
Jim Bunning (R-KY) Debbie Stabenow (D-MI)
Mike Crapo (R-ID) Robert Menendez (D-NJ)
Elizabeth Dole (R-NC) Thomas R Carper (D-DE)
Wayne Allard (R-CO)
Rick Santorum (R-PA)
http://banking.senate.gov/index.cfm?FuseAction=Information.Subcommittees
January 9th, 2003 Contact: Jesse Jacobs
(202) 224-4524
KEY DEMOCRATIC SENATORS URGING APPROPRIATORS TO INCREASE FUNDING FOR SECURITIES AND EXCHANGE COMMISSION
As final negotiations begin over FY 2003 spending levels for agencies within the Federal government, Senators Paul Sarbanes (D-MD), Carl Levin (D-MI), Chris Dodd (D-CT), and Jon Corzine (D-NJ), are urging the members of the Senate Appropriations Committee to maintain the $750 million for the Securities and Exchange Commission (SEC). With reduced funding caps being imposed by the Bush Administration and incoming Republican leadership, the Senators, who were intimately involved in addressing the corporate accountability crisis that has plagued companies and investors during the past two years, are deeply concerned that the SEC may not receive the resources necessary to ensure that the U.S. capital markets remain the strongest in, and the envy of, the world.
In letters to incoming Senate Appropriations Committee Chair Ted Stevens (R-AK) and Ranking Member Robert Byrd (D-WV), the four Democratic Senators are urging the Committee to ?provide the SEC with the resources it urgently needs to carry out its responsibilities for assuring the integrity of the capital markets and protecting investors. A revitalized and adequately funded SEC is crucial to restoring investor confidence in our markets.?
By all accounts, the SEC is seriously underfunded. The escalating growth in its responsibilities has far outstripped any increase in budget resources, so that the SEC is seriously understaffed, must rely on outdated and inefficient technology, and lacks the resources necessary to offer salaries competitive with those at other federal regulatory agencies. As a result, the SEC continues to face serious difficulties in building and retaining the staff it must have of highly competent accountants, lawyers and other financial experts. The recent accounting deceptions and corporate abuses require significant enforcement funds,? the Senators continued.
The Senate Appropriations Committee, under Democratic control, earlier approved a $750 million allocation for the agency, which was a substantial increase over the appropriated FY 2002 level of $459 million. The recently enacted Sarbanes-Oxley Act, which President Bush signed into law in July, called for an appropriation of $776 million for FY 2003.
Vigorous transparent capital markets are indispensable to a healthy economy, and the SEC plays a central role in assuring their integrity. As the SEC continues to deal with the consequences of the long, sobering period of financial reporting crises, and at the same time moves to implement the Sarbanes-Oxley Act, we hope very much that you will recommend the $750 million appropriation approved by your Committee in the 107th Congress,? the Senators concluded.
Kirschner arranged for GLUV Corp.’s transfer agent to issue him 3,000,000
dividend shares in advance of the date upon which the public was informed that those shares would
be issued, and then deposited a portion of the shares into a brokerage account.
Shouldn't the transfer agent be in hot water also? He/she should have known better.
So he gets a slap on the wrist and the SEC forever suspends the requirement that the "Due Bills" he owes and others owe are ever paid. What was totally missing in the suit against him was the fact that he still owes 56 BILLION shares of stock to shareholders.
* What if any recourse does an investor have against him personally to cause fair market value of the due bills to be paid?
* What recourse does an individual investor have against the SEC to cause their suspension of the Net Capital rule to be over turned?
I'd love some relief :)
That's it so far, except for the pray for relief bit.
oh good lord. Stunning..THAT'S IT?!!? Wonder what will happen to my MAMG shares now.
He settled already huh? Oh well, no punitive damages from him.
Exactly but Churak called this exactly as it has played out.
Say what? Who? Really?
that must have been the OTHER Churak...
Exactly but Churak called this exactly as it has played out. Those on the hook for huge losses simply got regulators to throw the rule book away (selectively) and screw us. The market is full of FRAUD and it stems from the top. The very top.
Posted by: Churak
In reply to: Wayne R who wrote msg# 44928
Date:5/18/2005 6:54:33 PM
Post #of 92656
They are prolly more interested in figuring a way out of this mess that screws us & protects the company IMHO
Something about that just doesn't sit well with me
First the $ values are out of whack
Second, it seems the punishment for scamming a few million bucks is a slap on the wrist, an insignificant fine, and a promise to not be bad again.
Maybe it's just me, but it sounds like the defendant wrote the punishment and the SEC idiots just said OK, sounds good
http://www.sec.gov/litigation/admin/2006/34-54281.pdf
UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION
SECURITIES EXCHANGE ACT OF 1934
Release No. 54281 / August 8, 2006
ADMINISTRATIVE PROCEEDING
File No. 3-12389
In the Matter of
PETER D. KIRSCHNER,
Respondent.
ORDER INSTITUTING
ADMINISTRATIVE PROCEEDINGS
PURSUANT TO SECTION 15(b) OF THE
SECURITIES EXCHANGE ACT OF
1934, MAKING FINDINGS, AND
IMPOSING REMEDIAL SANCTIONS
I.
The Securities and Exchange Commission (“Commission”) deems it appropriate and in the
public interest that public administrative proceedings be, and hereby are, instituted pursuant to
Section 15(b) of the Securities Exchange Act of 1934 (“Exchange Act”) against Peter D. Kirschner
(“Respondent”).
II.
In anticipation of the institution of these proceedings, Respondent has submitted an Offer
of Settlement (the “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 to which the Commission is a party, and without admitting or denying the findings
herein, except as to the Commission’s jurisdiction over him and the subject matter of these
proceedings, and the findings contained in Section III.2 below, which are admitted, Respondent
consents to the entry of this Order Instituting Administrative Proceedings Pursuant to Section 15(b)
of the Securities Exchange Act of 1934, Making Findings, and Imposing Remedial Sanctions
(“Order”), as set forth below.
III.
On the basis of this Order and Respondent’s Offer, the Commission finds that:
2
1. Peter D. Kirschner (“Kirschner”), age 40, is a Palm Beach County, Florida
resident. From June 1989 to January 2004, Kirschner was a registered representative associated
with multiple broker-dealers registered with the Commission. At various times, Kirschner has held
Series 7, Series 24 and Series 63 licenses. During the relevant time, Kirschner was associated with
an unregistered broker-dealer.
2. On August 8, 2006, a final judgment was entered by consent against
Kirschner, permanently enjoining him from future violations of Sections 5(a), 5(c) and 17(a) of the
Securities Act of 1933 (“Securities Act”) and Section 10(b) of the Exchange Act and Rule 10b-5
thereunder, in the civil action entitled Securities and Exchange Commission v. Peter D. Kirschner
and Media Magic, Inc., Civil Action Number 06-1403RMU, in the United States District Court for
the District of Columbia. Kirschner was directed to disgorge $109,400 in ill-gotten gains plus prejudgment
interest, and ordered to pay a $55,000 civil money penalty pursuant to Section 20(d) of
the Securities Act and Section 21(d)(3) of the Exchange Act.
3. The Commission’s complaint alleged that Kirschner, while representing a
small, privately held company, was directly involved in planning a series of transactions to effect a
reverse merger of that company into GLUV Corp., and, in the process, acquired control of the
public float of the newly merged entity. The Commission alleged that during the later stages of the
reverse merger, Kirschner arranged for GLUV Corp.’s transfer agent to issue him 3,000,000
dividend shares in advance of the date upon which the public was informed that those shares would
be issued, and then deposited a portion of the shares into a brokerage account. The complaint
alleged that the fact that the post-dividend shares had been issued and deposited prematurely into
Kirschner’s brokerage account—thereby making them tradable—was a piece of information that
was critically important to any market participant attempting to arrive at an appropriate valuation
for the company’s shares. The complaint alleged that this was also information that was only
known by Kirschner. The complaint alleged that just prior to the time at which the official
dividend was to occur, Kirschner sold 19,500 of these prematurely-received, post-dividend shares
to unwitting market participants at prices ranging from $5.50 to $7.95 per share, realizing proceeds
of $139,400. According to the complaint, had Kirschner sold the same quantity of shares hours
later, he would have realized gross proceeds of less than $20, as these shares were then trading at
less than a penny, reflecting the adjustment by the market to the issuance of the 2,999,999:1
dividend.
IV.
In view of the foregoing, the Commission deems it appropriate and in the public interest to
impose the sanctions agreed to in Respondent Kirschner’s Offer.
Accordingly, it is hereby ORDERED:
Pursuant to Section 15(b)(6) of the Exchange Act, that Respondent Kirschner be, and hereby
is barred from association with any broker or dealer, with the right to reapply for association after
five years to the appropriate self-regulatory organization, or if there is none, to the Commission.
3
Any reapplication for association by the Respondent will be subject to the applicable laws
and regulations governing the reentry process, and reentry may be conditioned upon a number of
factors, including, but not limited to, the satisfaction of any or all of the following: (a) any
disgorgement ordered against the Respondent, whether or not the Commission has fully or partially
waived payment of such disgorgement; (b) any arbitration award related to the conduct that served
as the basis for the Commission order; (c) any self-regulatory organization arbitration award to a
customer, whether or not related to the conduct that served as the basis for the Commission order;
and (d) any restitution order by a self-regulatory organization, whether or not related to the conduct
that served as the basis for the Commission order.
By the Commission.
Nancy M. Morris
Secretary
Everyone of the 3M shares Peter acquired should be tracked and all money recovered. The penalty of $55K is a joke given the obvious manipulation that went on. If 138,000 shares were sold by insiders then why is the complaint not for 138,000 shares?
Not at all
After 25 years of trying to figure out women, I finally figured out what they want.
A can of tuna
Sounds like it back-fired to me....LOL
hey, I gave a girl a can of tuna, and she moved in with me. There has got to be something abought the strategy that works
Thank you, TunaMan...
edit: I'm not going there
if you leave out the chicken, what are you making love to/with?
I've found that slaughtering a chicken, painting yourself with the blood and then making love under a full moon works real well.
Actually, if you leave out the chicken and the blood, it's just as fun....
can they legally do that? can they not be challenged in a court of law? there also was this extremely repulsive stinky clause they included which stated that the decision could be reversed if needed to protect investors was there not?
What ever happened to the companies "internal investigation" into who sold the 138,000 shares? Why has this information never been made public by the SEC / FLA? Who sold these additional 118,500 shares?
Well, the feds suspended delivery requirement remember? They also have zero interest in making decisions which will cause penny players to become rich.
Maybe you can make a call and report back to us...
exactly. the illegal shares they sold are all still out there in the marketplace
If they settle with the feds why would that resolve them of their obligation to settle with the marketplace in terms of delivery/elimination of shares put into the marketplace?
The story about the wife was just a rumor; we never actually knew who sold part of one of the eleven shares.
Yup, that's possible. It's been awhile now, but wasn't there a story about someone's wife supposedly selling post-split stock early? Maybe the others settled or are still in settlement talks w/ the feds.
Discovery -- that it what it's about.
http://en.wikipedia.org/wiki/Discovery_%28law%29
In law, discovery is the pre-trial phase in a lawsuit in which each party through the law of civil procedure can request documents and other evidence from other parties or can compel the production of evidence by using a subpoena or through other discovery devices, such as requests for production and depositions.
Could be that Kirschner spun them some kind of story, and they genuinely didn't know that their stock shouldn't have been traded. Though I think they ought to have known. After all, we did.
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