Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
U.S. SEC charges 23 firms in short-sale crackdown; 22 settle
Reuters – 3 hours ago
By Sarah N. Lynch
WASHINGTON (Reuters) - Twenty-two investment firms will collectively pay more than $14.4 million in sanctions to settle civil charges in connection with a broad crackdown by federal regulators into illegal short-selling practices, the U.S. Securities and Exchange Commission said on Tuesday.
The SEC said it had charged 23 firms for violating a rule that prohibits firms from shorting a stock within a five-day window of a public offering, and then buying the same security through the offering.
Only one of the 23 firms, G-2 Trading LLC, is fighting the charges through litigation.
The SEC also simultaneously issued a risk alert that seeks to highlight the enforcement cases as an example to warn the market against violating the short-selling restrictions, known as Rule 105 of Regulation M.
The prohibition against short-selling ahead of an offering and then buying the same stock in the offering is aimed at reducing the chances of market manipulation. The rule applies regardless of a trader's intent.
The SEC said the firms charged all bought shares from an underwriter, broker or dealer participating in a follow-on offering after they had shorted the stock during the restricted period.
Among the 22 firms that are settling the SEC's charges are D.E. Shaw & Co, Hudson Bay Capital Management, and the Ontario Teachers' Pension Fund Plan.
The other firms were as follows: Blackthorn Investment Group, Claritas Investments Ltd, Credentia Group, Deerfield Management Company, JGP Global Gestao de Recursos, M.S. Junior Swiss Capital Holdings and Michael A. Stango, Manikay Partners, Meru Capital Group, Merus Capital Partners, Pan Capital AB, PEAK6 Capital Management, Philadelphia Financial Management of San Francisco, Polo Capital International Gestao de Recursos, Soundpost Partners, Southpoint Capital Advisors, Talkot Capital, Vollero Beach Capital Partners, War Chest Capital Partners, and Western Standard.
All will pay a varying amount of fines, disgorgement and interest without admitting or denying the charges.
(Reporting by Sarah N. Lynch; Editing by Gerald E. McCormick and Leslie Adler)
http://finance.yahoo.com/news/us-sec-charges-23-firms-153100217.html
original link courtesy of 7/10/11
===
4kids
all jmo
This would be great if they do it...
thanks go to Z for that article
what i find *refreshing* is the awareness
more and more who frequent SMBs' are realizing
i personally don't think the dolts (SEC) can become fully *transparent*
without imploding the entire US market
which is why i expect some *re/grandfathering* b4 they electronically
tag all pubcos re: hard locates
what is beyond disingenuous are those brokerage firms who *collude*
with cash accts vs margin
as i've noted for years >> they all collude
it's easy when stocks are so far out of the money based on *orchestration*
or what i call the cycle of money
i am slightly encouraged that more and more of *retail* have figured out
the cycles :)
i am also slightly encouraged that the SEC's *actions* seem to have
stepped up (time wise)
curious to see how very specific legit OTC co.s are *handled* going forward
since the SEC's *proverbial* sweeping under the rug *commenced* in 2009
===
4kids
all jmo
Good article! 4kids
Question is will the ones that regulate, and possibly profit from it, EVER do anything about it?
Or just continue to steal from the investors, trying to fulfill the American Dream, on the OTC, and other markets.
I'm not holding my breathe.
Wonder how high up the ladder the corruption goes???
all just my opinion of course :)
"All the facts are becoming known."
Shorting America
By Walter Cruttenden
It is widely agreed that excessive short sale activity can cause sudden price declines,
which can undermine investor confidence, depress the market value of a company’s
shares and make it more difficult for that company to raise capital, expand and create
jobs. This is particularly aggravating for entrepreneurial companies; the engines of new
job creation. In the crash of 2008 short sale activity reached record levels and
exacerbated the market turmoil, leading to one of the most severe economic declines in
modern history.
Job formation is highest among pioneering companies, such as those in the computer,
biotech and emerging growth industries. Studies show that approximately 80% of all new
jobs come from small businesses or new companies in their fast growth phase; those that
grow the fastest hire the most. However, because research, development and new product
innovation are risky and often require multiple rounds of equity financing, short sellers
often target these companies, to the detriment of America.
Short sellers are essentially traders that are hoping a company will experience problems
(such as product delays or the inability to raise financing) so they may profit from the
setbacks. These traders or trading machines make the most if a company struggles and
goes out of business, and some short sellers actively work to make that happen.
Aggressive shorters, and short selling pools, will sometimes hire stock “bashers”, people
paid to post negative articles on blogs and message boards. Their goal is to put out
negative news on a company or its products in an effort to cause the company problems
and insure the stock declines so their negative bets pay off. Others will put up “flash
orders” advertising to sell a large number of shares in an effort to drive down the price.
Thus entrepreneurial companies not only need to fight the battles of developing new
products and markets, they have to stave off the short sellers in the meantime. This
growing culture of betting against a company for the sake of short-term trading profits
(regardless of economic consequences) has negative economic repercussions. This trend
has been fostered by:
• Technology that allows trader anonymity without consequence. Short sellers, like
private hedge funds do not have to disclose their negative bets, whereas mutual
funds and most institutions are required to publicly report their holdings.
• Brokerage firm procedures that make it easy for short sellers to borrow stock
without informing the shareowner of the transaction or potential consequences.
• Internet forums and message boards that allow traders to quickly publish negative
comments about a company, thus forcing down prices. • The repeal of the uptick rule, which had required traders to only short when it
wouldn’t hurt a company’s stock price, and now allows shorting regardless of the
company’s current stock price direction, enabling “piling on” trading.
As asset prices decline people feel less wealthy and spend less, which in turn causes real
economic contraction. Economists recognize that investor confidence determines
economic activity and Fed Chairman Bernanke recently commented that the economy
could avoid a “double dip recession” as long as markets stayed healthy. Governments
around the world are now struggling with how to stop the proliferation of short sellers
that bet against the economic well being of their nation. This past summer Germany
banned short sales outright in an attempt to quiet its markets during a run on the Euro.
How did things get this way?
Short Sale History
Originally there was no short selling. People that owned shares of a business rarely traded
those shares and would never loan their shares out to a third party to bet against them.
Short selling began as a way to accommodate buyers and sellers. Market makers (such as
the brokers that originally met under the buttonwood tree which became the NYSE) knew
people that wanted to sell their shares if the price reached a certain level. If a buyer
showed up and wanted to purchase a security when that seller was physically unavailable,
the market maker would stand in for the seller and “short” the shares. The outstanding
short rarely lasted more than a few days. Thus there were no actual short sale investors,
just brokers that were temporarily shorting a stock to accommodate a real seller. And
these short sales generally took place when there was demand, meaning at favorable
prices, or at an “uptick” (increase to the prior sale price) and were triggered by the fact
the stock traded up to a certain level. It was a win-win transaction for all parties. In these
early days, traders did not bet against companies, and there was no ability to artificially
drive down the price of a stock.
Share ownership was originally represented by a physical certificate in the shareholders
name kept by the owner in a safe deposit box, or sometimes under the mattress. With the
prosperity of the post World War I economic boom, more people became invested in the
markets, and as trading frequency increased, investors began to leave their shares with a
brokerage firm for convenience purposes.
At first the certificates were kept in the name of the individual shareholder but as trading
volume increased the brokerage firm simply kept the shares in “street name”, meaning
the name of one of the brokerage firms on the street, with an accounting entry to trace the
ownership. This made it easy for the brokerage firms to get into the business of making
“margin” loans against the securities. The securities (collateral for the margin loan) were
already in the brokers name and possession so they did not have to worry about having to
foreclose on the collateral if that became necessary. As margin loans became common
trading volume further increased.
Short selling first came into vogue with the crash of 1929 when certain investment pools
realized it was easy to bet against a company, especially with so many margin loans
outstanding. The market was declining rapidly and shares could be borrowed from
brokerage firms, and the brokerage would get paid for lending those shares.
This historic first wave of large scale short selling probably exacerbated the market
decline, and in some cases, may have gone hand in hand with stock manipulation. Short
sellers realized that if they could force down the price of a stock they could force a
margin call. This effectively forced a sale of the shares allowing the unscrupulous trader
to make money on their short. The severe decline of so many companies in 1929 through
the early 1930’s forced the regulators to study the matter. Finally in 1938 the “uptick”
rule was adopted. This required any investor that wanted to short a stock to sell only on
an uptick (thus returning to the original de facto practice), and greatly reduced the
amount of short selling activity. Prosperity soon returned to America.
By allowing short sales only on price strength, the rule mitigated the “piling-on effect”
and the self-fulfilling prophesy that short selling can bring about when left unrestricted
(short selling causes price declines which in turn shake the confidence of long term
holders who then sell and prolong the downward price trend regardless of underlying
fundamentals, eliminating the company’s ability to raise new capital, causing a vicious
cycle). Thanks in large part to the “uptick rule”, short selling was held to a minimum.
Consequently, short sale activity and market volatility remained relatively quiet during
the 69 years the rule was in effect until its repeal in 2007. To the student of history it is
no coincidence that the repeal of the uptick rule was followed by one of the worst market
declines in recent memory.
Since 2007 there has been a marked increase in short sale activity. Aggressive short
selling not only hurt small companies, it aggravated the 2008 run on Lehman Brothers,
Bear Stearns, Merrill Lynch, WaMu and other long standing financial institutions, that
depended on stable equity values while they worked out their financial problems. Short
selling effectively reduced the duration of the workout window and the result was a
domino effect of economic decline. While the big names captured the headlines many
emerging growth companies suffered similar attacks on their stock and were forced to
downsize or otherwise curtail job creation efforts. As the securities of the unstable
companies, large and small, became worth less many companies found it suddenly
impossible to exchange equity for debt, raise new financing or otherwise restructure in a
normal manner. Rampant short selling causes adverse economic consequences on a scale
that quickly gets out of hand yet its full ramifications are still not widely recognized.
Aggressive short selling was a major contributor to the recent economic troubles as
evidenced by the fact that more large companies have gone into bankruptcy or closed
their doors in the three years since the repeal of the uptick rule, than at any other time
since before the uptick rule. During this period short selling activity became almost a
mainstream activity as new short selling funds proliferated. Many of these so called
“Bear Funds” now leverage their investments whereby ever dollar put up results in two or three dollars of shorted stock. Jim Cramer and other market pundits have called for a ban
on such funds.
This economically contracting behavior has been accompanied by an increase in market
volatility, evidenced by the rise in the “VIX” (the CBOE volatility index), which has
reached historical levels over the last three years. Needless to say, these larger than
normal market swings spook long-term investors, and drive people out of the equity
markets. This not only shakes investor confidence, but it is bad for the capital formation
process as it restricts financing for innovation and exacerbates economic difficulties.
Fed Chairman Ben Bernanke, Morgan Stanley CEO John Mack, Congressman Gary
Ackerman, Former SEC Commissioner Chris Cox and others have called for a review of
the decision to lift the uptick rule. However, there are now many traders that have an
interest in large short selling funds and as of this date there has been no agreement to
bring back the uptick rule. The SEC did recently adopt Rule 201, which bans short selling
if a stock has fallen more than 10% in a single day. But the fact is if a stock does decline
10% in a single day it has already spooked investors in that company. While it is a
laudable effort it does nothing to address the underlying operational issues that enable
large scale short selling. The easiest and most natural way to rein in aggressive short
sellers is a return to a permission-based system that involves the investors who shares are
being borrowed. In other words, require the approval of the person whose shares are
being loaned to the shorts before short sales can be implemented.
The Genesis of the Problem
Anyone that would like to short a stock must first arrange to borrow those shares, because
stock clearing rules require delivery of the shares to be made within three business days.
If stock certificates were still held by individuals, and these individuals therefore had to
approve the loan of their certificates to would be short sellers, there would likely be very
little shorting activity. After all, what long-term investor would actually loan his or her
shares to someone that wants to bet against his or her economic interests?
Since the 1960’s, technology, record keeping and trading activity have advanced to the
point where not only do most investors find it more convenient to keep their securities
with their broker, but many opt for full featured accounts that give the account holder the
right to borrow against the market value of the account, use a credit card against the
account, or enjoy other borrowing privileges. This means the investor has signed a
margin and hypothecation agreement with a brokerage firm and therefore that brokerage
firm can now freely lend those shares in the account to prospective short sellers without
the investor-owner’s knowledge or permission.
The original purpose of the hypothecation agreement was to give the brokerage firm
access to the client’s securities simply so they could put these securities up as collateral at
a bank to borrow the funds they were loaning to the client. But eventually the brokerage
industry realized the broadly written hypothecation agreement would also allow them to lend the securities to prospective short sellers, and generate additional income for the
firm.
Most shareowners are completely unaware they have given up such extensive rights
under these margin or “hypothecation”agreements. As they are now written, even if an
investor has a minimal loan balance outstanding, the brokerage firm can lend out shares
in that investors account. This practice has evolved so that most brokerage firms now
maintain “Stock Loan Departments” and they get paid well for loaning those certificates
out to short sellers, yet rarely do these proceeds make it to the individual investor. Many
investors have no idea they are effectively aiding the short sellers that are betting against
them. The ease of borrowing such shares nowadays, without an investor’s specific
knowledge, is a major factor in the increase in short sale activity.
Investor Rights Violated
If shareholders knew that their shares were being loaned to prospective short sellers,
whose purpose is to effectively bet against the owner of the securities, few of the stock
loans to short sellers would be made. There is currently no required disclosure to the
rightful owner that provides the owner with right to say yes or no. This lack of
transparency is the root of the issue.
While it is justifiable that a brokerage firm should have the right to borrow against the
shares of anyone they make a margin loan to, they should not be able to loan these shares
to a third party that has an economic interest opposite the shareowner s without specific
approval of that shareholder. But current margin agreements, written by the brokerage
firms to include blanket hypothecation language, do not differentiate between legitimate
borrowing to accommodate a margin loan, and the loaning of shares to short sellers. Thus
current procedures effectively allow the borrowing of shares from one party to be loaned
to another party that bets against the economic interests of the first party, without specific
disclosure.
Unauthorized Share Issuance
Another related problem, that occurs with significant short selling, is the lack of
disclosure that the float is effectively being increased without conveying that information
to the public. The creation of phantom shares, by loans of existing shares to short sellers,
boosts the float (number of freely traded outstanding shares) by artificial means even
though no such increase in shares was ever authorized by the company or the SEC. For
example, one company we have studied has 40 million shares outstanding and a 6 million
short position. Thus investors think they own 46 million shares, even though neither
management nor the SEC ever authorized the extra 6 million shares. In truth there are
only 40 million shares outstanding and the extra shares have been created out of thin air
by the shorts. Far from the original purpose of the practice these shorted shares often stay
outstanding in virtual perpetuity.
But worse than the issuance of phantom shares is the fact this is happening on a large
scale with many investors being taken advantage of without their knowledge. Again, this
is because most investors are effectively loaning their shares to short sellers without
realizing they are helping these short sellers to degrade the value of their securities. The
ability to borrow shares to short, which has become relatively easy, works to the
detriment of long-term investors and the capital formation process.
Solution
The present system lacks transparency. Investors should never be put in a position where
their investments are used to bet against them without their specific knowledge.
Fortunately, it is an easy fix:
Brokerage firms should be required to modify their hypothecation clause in new account
and margin agreements to specifically inform investors that their shares may be loaned to
short sellers that are betting against them, and only allow this practice with an investor’s
knowledge and express permission. This would only require a few sentences to be
changed and should include a check box where an investor is required to give permission.
This would not preclude the brokerage firm from legitimate borrowing against these
shares, it would only preclude the loaning of such shares to short sellers without an
investors knowledge.
The effect of this action would be that if a brokerage firm wants to loan out the shares on
its books (for short sale purposes) it could only do so if the investor has given permission,
whether or not those shares are held in street name or margined or otherwise obfuscated
by commingled ownership. Some brokerage firms would argue that if they have made
margin loans against those securities they should have the right to loan those shares to
other investors. But this is not a valid argument, as loaning shares to a bank for
borrowing purposes has no negative economic consequence to the owner of the shares,
whereas loaning shares to a short seller has direct negative consequences to the owner of
said shares. The two situations should therefore be bifurcated: investors should have the
right to approve any loans of their shares to short sellers, and brokerage firms should
retain their rights to the collateral for legitimate borrowing and collection purposes.
As long as investors are responsible for paying interest and paying back the margin loans
they should have the right to determine what is done with the underlying shares. They
should not forfeit this right under any circumstances. Giving investors this basic right in
no way diminishes the brokerage firm’s ability to liquidate such shares if for any reason
the investor is unable to pay his margin balance. In fact, it could be argued that the
collateral value of the underlying shares will hold “more” value if they are NOT being
loaned out to short sellers.
The result of such a rule (which could be adopted by the SEC or passed as a law by
Congress) would be to once again return short selling to its original purpose. This would
naturally limit the number of people that could bet against investors’ interests, as very
few investors would allow such activity if they were aware that it might directly impact the value of their securities held. Indirectly it would also reduce the number of “flash
orders” and “machine trades”, which are both highly dependent on the easy borrowing of
shares to short. Furthermore, it would help out entrepreneurial companies, by returning
confidence to the long-term investor, the backbone of America’s job creating capital
markets system.
Summary
In summary, investor rights were slowly usurped by the advance of technology that did
away with the investors name on specific certificates of ownership. This obfuscated the
rights of the certificate holder and led to an increase in the transfer of those securities for
short sale purposes, against the investor’s best interest. The potential damage of increased
short sales was held at bay by the uptick rule that effectively limited the amount of shares
that could be shorted but this rule was repealed. By returning to a permission based
system, whereby the holder of the securities regains the full right to determine the fate of
those securities, a natural balance will be returned to the short sale market (whether or not
the uptick rule is reinstituted). The rightful owner of the securities will once again be in a
position to determine if he or she wants to loan their securities to a third party.
The result of full disclosure and the return of this basic investor right will be reduced
market volatility, an economic system that does not penalize innovation, and a level
playing field for all investors.
Walter Cruttenden, 60, is a financial markets entrepreneur having founded and served
as CEO of two innovative investment banking and brokerage firms; Cruttenden Roth
(now Roth Capital, one of the largest providers of equity capital to emerging growth
businesses), and E*Offering, formerly part of E*Trade Securities. Cruttenden is also an
author of books and films on history and astronomy.
Email: Walter@CruttendenPartners.com
Phone: 949-399-0300
original post courtesy of z
====
4kids
all jmo
Finra Fines Oppenheimer $1.4M for Penny-Stock Deals
By SAABIRA CHAUDHURI
August 5, 2013, 1:47 p.m. ET
http://online.wsj.com/article/SB10001424127887323514404578650143972097834.html
The Financial Industry Regulatory Authority has fined investment bank Oppenheimer & Co. $1.4 million for selling unregistered penny-stock shares and for failing to have an adequate antimoney-laundering- compliance program to detect suspicious penny stock transactions.
Oppenheimer neither admitted nor denied the charges.
"The sales of penny stocks at issue in the settlement with FINRA occurred a number of years ago and were mostly conducted by brokers no longer associated with our firm," a company spokesperson said in an emailed response. "The firm has significantly tightened its policies relating to the sales of low priced shares and enhanced its review of client sales with respect to anti-money laundering oversight."
According to the order from Finra, Oppenheimer is required to hire an independent consultant to review its penny stock and antimoney- laundering systems.
"Broker-dealers are required by federal securities laws and Finra rules to monitor customers' accounts so that those accounts are not used for illegal activities, such as money laundering and penny-stock schemes that can cause considerable harm to investors," said Brad Bennett, head of Finra's Department of Enforcement. "If Oppenheimer had an adequate antimoney laundering and supervisory program in place, it would have made further inquiry into the penny stock sales that were the basis of this action."
The charges were first brought against the firm in a May complaint by Finra.
Finra found that from August 2008 to September 2010, Oppenheimer sold more than a billion shares of 20 low-priced, highly speculative securities, also called penny stocks, without registration or an applicable exemption.
It said the firm's customers deposited large blocks of penny stocks shortly after opening the accounts, and then liquidated the stock and transferred proceeds out of the accounts.
Finra also found the firm's systems and procedures governing penny-stock transactions were inadequate, and were unable to determine whether stocks were restricted or freely tradable.
The agency charged Oppenheimer with failing to conduct adequate supervisory reviews to determine whether the securities were registered, and found that Oppenheimer's antimoney-laundering program failed to monitor patterns of suspicious activity associated with the penny-stock trades.
The agency also noted Oppenheimer didn't conduct adequate due diligence on the account of a broker-dealer customer in the Bahamas, which Finra says was setup to sell securities for parties not subject to Oppenheimer's anti-money laundering review.
Finra said this is the second time Oppenheimer has been found to have violated its antimoney-laundering obligations.
In March, Oppenheimer agreed to pay more than $2.8 million to settle federal allegations regarding overstated returns and the value of a former unit's fund. The Securities and Exchange Commission said that Oppenheimer shared with investors misleading quarterly reports and marketing materials about a private-equity fund it managed.
And in February 2012, the New Hampshire Bureau of Securities Regulation fined Oppenheimer $155,000 in fines and expenses for the illegal sale of penny stocks and for failure to supervise its employees.
Write to Saabira Chaudhuri at saabira.chaudhuri@wsj.com
====
original link courtesy of the penny guru
====
4kids
all jmo
Ian Fraser: The beauty and insanity of HFT
By Ian Fraser
Sunday, May 19, 2013
Thanks for the info.
SS1
Yes penny l knew that. I am just trying to break someones balls Hey Thank You
Guru,
AWSOME!!!
That info answers many questions.
Thank you,
M
Please sign if you value *transparency* in our markets
PETITION >> Open letter to the Securities and Exchange Commission, In a Plea to Honor and Uphold Market Laws and Regulations
http://www.ipetitions.com/petition/open-letter-to-the-sec-to-regulate-market-manipula/
OTC Short Report Link
to view last month's daily reg sho percentages in total
http://otcshortreport.com/
chart shows the one week
scroll down for the last month's data
==
4kids
all jmo
IMO - if they are brokers go for it.
If there is a proven association with a broker or hedge fund - go for it, just not personal home addresses.
You can't give the aliases however, but I think exposing their real ID is important.
It's on topic here:
http://investorshub.advfn.com/SCAMS-R-US-25227/
4Kids will confirm - many of the "shorts" are also the "pumpers", just a variation of the same con.
DIRTY ROTTEN SECRETS By George Chelekis
The Dirty Rotten Secrets of the Small Cap Markets were previously unwritten rules, passed along verbally among stock promoters, company insiders, stock brokerage firm principals and many who are close to the outer fringes of this very exclusive club. Amazingly, many US and Canadian securities regulators have also been members of this very closed group. It is always interesting to discover how the head of a stock exchange's surveillance department, upon retirement from "public service," ends up as a senior vice president at the brokerage house with which he once squabbled or, vice versa, the favorite son of a brokerage firm later becomes the head of a securities commission. The financial markets are truly a revolving door, whereby this year's company insider was once a stockbroker; whereby a highly aggressive SEC attorney pursuing a scandalous media personality "suddenly" retires and becomes a senior executive at the Smith Barney brokerage firm. One thing is for certain, in the apparently uncertain world of "the business," YOU are on the outside looking in.
The stock market is rigged against you and in ways you may never discover. The rules, laws, secrets and axioms I've listed in this essay should give you a much clearer understanding about the inner workings of the financial marketplace. No one has previously codified the "omerta," or code of silence which is rampant throughout the financial markets. One would become a pariah, an undesirable or an outcast, by writing these down and broadly disseminating them. You are NOT supposed to know these unwritten rules and God help the individual who passes them onto you.
1. LAW OF THE PEZ. This is dedicated to Murray Pezim, once the most powerful stock promoter in all of Canada. According to legend, Mr. Pezim, upon hearing that someone had made a killing on his stock play, immediately remarked, "Shareholder profits are short-term loans." Ultimately, if you continue your small-cap speculations, you will lose. Either the markets will turn or you will drop your guard, but eventually, you will lose. One should understand that the small cap stock markets run pretty much like a casino.... the longer you stay at the tables, the greater your chances of failure.
2. MOTTO OF THE STOCK PROMOTER. Sell when everyone is buying and buy when everyone else is selling. Actually, more often it is, sell when everyone else is buying, completely exit the play, and go find something else for them to buy later. It may even be: Start shorting your deal when you've sold out your entire position so you can score even more profit on the way down. There are corollaries to this motto, such as "never get married to a deal," or "never believe in your own deal," or "have a new deal ready to rock & roll as soon as the current one flops."
3. LAW OF THE UPTICKS. Stocks that are running higher are said to be upticking. Despite every effort I have made to emphasize that the best time to buy a stock is when it is low and boasts a sorry-looking flatline stock chart, speculators inevitably chase stocks to new highs. Stock promoters and insiders buy, or obtain a position, at the low and sell during the promotion or "discovery." Sadly, there will always be some type of promotion that will create upticks and speculators will chase that stock to a new level. Greed generates upticks. What stock promoters know that you don't is this law: A herd of speculators will only buy on the UPTICK.
4. AXIOM OF GREED. In an earlier essay, I isolated that greed originated from a "perceived" lack of speculative opportunities. This false perception causes a speculator to get greedy and chase a stock to a new level. If one has a hundred speculative opportunities on their plate, one is less eager to chase any specific stock. The lesser the number of opportunities one reviews, the greedier one becomes to chase a heavily promoted stock. A stock promoter will, thus, make "his stock" appear to look like the only game in town worth playing. Greed essentially emanates from deprivation.
5. RULE OF CONFUSION. The only time one rushes into a quick decision is when they are confused or disoriented or misled. The stock promoter's greatest weapon is CONFUSION: Catch a speculator off guard and sucker him into a stock. The more disoriented or confused the speculator, the greater his chances of being snared. Stock promotions include an overwhelming amount of data, reports, corporate reviews and so forth that are packaged in such a way as to confuse the speculator. If, at any time, you are overwhelmed with out-of-control emotions or data which you don't understand, it is better to stay out of the play.
6. SECRET OF EXCITEMENT. You've heard about the "forbidden fruit" or "unknown pleasures." As long as something remains a mystery, it can create an "excitement." Excitement is a sensation which one commonly associates with pleasure. Therefore, when an exciting proposition is offered, you may readily accept it in order to experience THAT sensation. When someone heaps excitement after excitement, upon you, in either the written or spoken word and/or with graphics (visuals, photographs, charts, drawings, etc.) and especially in a loud or emphatic manner, you become disoriented and confused. One overcomes this "sensation of the unknown or forbidden" through experience, often with a rude and unpleasant awakening. Stock promoters abuse your inexperience, and naiveté, to sell you stock. ALL mining speculations are exciting until the assays come back or a mine goes into development. Then reality sets in.
7. LAW OF WAITING. The longer you wait, the greater your chances for failure. This applies to both holding a stock which is declining and to a stock which is running. The odds are greater than 90% against you... that you will fail in a speculation, if you wait for it to recover or if you chase a stock which has already begun its run. Generally, a stock moves up in less than two weeks, often in two to five days. The waiting period, for a stock to allegedly recover, is the slow, dragged out retreat you later observe in the share price. As believers stop believing, the share price declines, often never recovering. Of course, if one wants to wait forever, then eventually the stock may recover. The longer one waits, during a runup, the smaller one's potential profits and the greater one's exposure to losses. (One important caveat: Occasionally, there are a few good deals--about 20 or 30 annually--when one SHOULD wait for the company to mature. Almost always, they come out of left field and, rarely, does anyone know in advance which company will become tomorrow's success story.)
8. AXIOM OF BELIEVING. The higher your expectations in a stock, the greater your chances of losing money in that speculation. All of the promotion is geared to make you a "believer." Most speculators are betting on a tip or a rumor. They are taking someone else's "word" for the outcome. Absolutely no one should invest or speculate in a stock without understanding the risks as well as the reward. Stock promoters create believers by providing ONLY the reward potential, without also including the risk factors. Believers eventually discover the risks, long after the stock has begun its decline.
9. LAW OF LOSERS. Oddly, those most attracted to speculative markets are failures in other aspects of their lives. They may be wealthy, but consider themselves, in some way, as having "failed." Medical doctors are prime targets of stock promoters, as they are not only affluent may have "settled for less" in their lives or feel they "are owed more" for the work they do. Whoever has failed, in some key aspect of their life, often tries to make up for it by gambling....often speculating in these markets. The loser is always trying to compensate for a failure in another part of his life and continues to heavily lose as a speculator. (Note: I stay in touch with certain losers and use them as a yardstick for my trading -- when they buy, I sell; when they sell, I buy. The loser has a knack for exiting his position, a day or a week before a major runup; or he/she simply always buys at the top of the runup. The downside to communicating with losers is that they are so darned indecisive and fretters; their worrying can and does rub off and creates a confusion for oneself.)
10. LAW OF THE SUCKER. PT Barnum was right: A sucker is born every minute. For every speculator that is wiped out, a fresh one is champing at the bit to start betting. Stock promoters prop up their plays by finding new blood to drain. The greener the speculator, the redder the carpet laid out for him. If there were no new suckers coming into the game, it would all be over.
11. SECRET OF THE AREA PLAY. Virtually all area plays fail. Rarely is there a long-term beneficiary to that area play, other than the initial company which made the discovery. The secret of the area play depends upon #1 (Law of the Pez). Those who profited from the share price runup of the company making the discovery are then offered a "second chance" or a third or a fourth with the rush of new companies into that area. Primarily, these companies are trying to finance other explorations elsewhere, but the fact that they staked some ground or bought some cheap claims doesn't stop them from parlaying that into an artificially inflated market capitalization. Inevitably, 99% of these companies fail to deliver, which is soon reflected in their vaporized share prices. Stock promoters, knowing well their chances of success were always very slim at best, long ago dumped their shares. The last one into the area play tends to have the worst chances of success.
12. THE GURU AXIOM. The least profitable time to follow any guru (stock promoter, newsletter writer, company insider) is immediately following his last successful play. The cliché that "he is only as good as his last play" is a promotional device effectively utilized to attract new money into a new play. If one looks at some of Canada's recent success stories in the mining business, the BEST time to follow the guru is immediately after his or her failure. Those who "had it," failed miserably and later bounced back seem to offer the highest probability of success. Often, there is a rush of money into the guru's "new play," which quickly exits when they discover that "this ain't the same one as the last one." It never is. Of course, every guru is keen on pointing out all of his previously successful plays and forgets about his failures. Self-fulfilling prophesies require substance in order to survive. Catch the "gurus" when they are down and out and heed their advice at that point in their careers. You may increase your chances of success. Hint: Sheer desperation drives them to repeat their success or to completely leave the business.
13. CANADA'S BEST KEPT SECRET. Many Canadian speculators don't pay for their stock. These Canadian speculators bet on stocks, against the equity in their account. We've heard about T-3, etc. That is bull. The truth is often, more like T-12 or T-20 (as in 12 or 20 days to settle instead of the required three days). Brokerage firms have been known to extend, to their best clients, the time they can hold "unpaid stock" for weeks. What is also not very well known is that brokerage firms can, and frequently do, short sell any stock which remains unpaid (they do so to protect themselves). Thus, during an exciting runup, one observes (or hears about) massive shortselling of a stock -- the stock wasn't paid for, so the brokerage firm shorts it. A brokerage firm's credit manager can quite excitedly extend your "credit terms" so that you have "more time to pay for your stock." Essentially, you end up betting against yourself, under these circumstances, because the brokerage firm is shorting your purchase. Later, you end up selling at a loss and the brokerage firm covers at a profit. The house nearly always wins. Your stockbroker gets his commission whether you lose or not.
14. THE CANADIAN LAW OF SHORT SELLING. While it is very expensive and deadly for the unsophisticated speculator to short a Canadian stock, brokerage firms can easily short stocks. They short against their "inventory." Generally, any rush of excitement into a stock is done under a short, speculative time frame (whereupon the speculator doesn't actually pay for his stock). Brokerage firms short sell against the unpaid speculation and drive the stock price down, down, down. As very large Canadian brokerage firms also accept many US stock orders, they short sell virtually every order which arrives. While the US investor pays for his/her stock, the Canadian firm can short sell against it, because rarely is delivery ever taken on that stock. As long as the certificates remain in the brokerage firm, it can be shorted.
15. AXIOM OF MOTION. What emotionally upsets any speculator is a LACK of motion. It is the absence of motion which prevents a speculator from patiently accumulating shares in a flatline stock (the share price remains constant at, or near, the floor of its stock chart). Speculators are eager to make their money work for them. Thus, if a stock doesn't move, they panic. Gradual downward motion rarely creates a panic. Imagine yourself in a well-lit room with a dimmer light. Stock promoters gradually turn down the lights until you finally discover you are sitting in the dark. Conversely, when they want to create the excitement, they abruptly turn on the lights. A stock forever trading at the same price creates an emotional upset, thus the gradual "up and down" motion manufactured by stock promoters and insiders and brokers. "Get it to move" is their motto if they want you to hold your position. UP offers hope and a recovery of your initial investment or (finally!) a profit after having waited so long. DOWN drives fear up your spine and you remain fixated in the stock, like a deer in a car's headlights.
16. SECRET OF PANIC. If you hold a position in a stock and are panicking, you should not be holding that stock position. You probably don't know enough about the company or have mentally spent that money for some other purpose than speculating in that stock. You are also very low on the food chain of information. A stock promoter's investor relations department primarily exists to minimize, reduce or eliminate the panic you feel in obtaining and holding your stock position. Panic is manufactured in approximately the same way excitement is created. The secret to overcoming panic is this: When it all looks like the end of the world, that may be the best time to buy; when it all looks like the world is made of cream cheese, run for the exit doors. Please realize that, generally, if someone has created a panic within you, it is for some ulterior motive -- they are aggressively trying to get you to do the opposite of what you should be doing.
17. LAW OF STOCK OPTIONS. Insiders like to hold free stock, just like anyone. Stock options exist so that insiders and promoters can cause runups, thus selling off their stock and subsequently issuing new stock options. This law reads as follows: The ONLY reason stocks are runup is because of incentive stock options. If stock options didn't exist, we wouldn't see any stock runups. Because most small cap companies are broke, they pay promoters with stock options. Thus, the promoter has a vested interest to get a company's share price above a particular level.
18. AXIOM OF HISTORY. Leopards almost never change their spots. The same guy running a shoddy stock promotion, a few years ago, is going to run a similar disaster again. It behooves every speculator to dig deep and find out who are the characters in this current play. Many times, the dishonest stock promoter runs the play from a background cover using a front man. You will find them, by looking for their associates. Crooks run in the same circles. Occasionally, you can be thrown off by a new name. He has a history. Find out what it is before speculating. No matter the cost, it is a lot cheaper than the losses you may incur in your speculation.
19. LAW OF PAPER. Share certificates are like corpses until a stock promoter gives them life. All paper is intrinsically worthless unless there is someone who wants to pay you, to take the stock off your hands. If there were no promoters in this world, then you would never be able to exit your position.
20. RULE OF THE EQUIPMENT. The speculator who has the most sophisticated quotation equipment, knows how to use this equipment, understands the quotes and what they represent, effectively uses his equipment, and also the fastest phone line to the trader, gets in and out of his paper the fastest.
21. LAW OF THE INSIDER. The speculator who actually knows what the insider is doing, whether it is accumulating or dumping his position, will be the most successful speculator. Everyone else is guessing and will have a greater or lesser degree of failure in his speculation.
22. THE SPOUSE FACTOR. This could also be a corollary to Murphy's Law for a deal. The wife wants a new house, a new car, etc. And the promoter or insider sells, sells, sells to afford these new toys. Down goes the stock price.
23. AXIOM OF THE BID. A new wave of buying into any stock is a method for an insider, promoter or disgruntled shareholder to exit the position. One should look at "the bid" as the key which unlocks the door and permits one to exit a stock position. Conversely, one may wish to consider "the offer" as the trapdoor which could send a speculator to the bowels of hell.
24. LAW OF THE HOLY ROLLER. Jesus threw the moneylenders out of the temple. Anyone running his play under the guise of Jesus would anger the Almighty and bring ruin to his shareholders. I guess the only reason a promoter might turn to religion is that no one except God will forgive him for what he has done to his fellow man.
25. THE LAW OF WASH TRADING. Insiders, stockbrokers and marketmakers "fabricate" trading volume by trading shares among each other, in order to deceive investors into thinking that the stock is liquid. In the hands of a madman, of which there are many, wash trading becomes an artistic manufacturing of massive trading in the stock. A promoter or insider (market manipulator) can set up three to twenty brokerage accounts and cleverly trade the stock, up and down the charts. As soon as "new blood" comes into the stock, suckered in by a quick runup, down comes the stock as the market manipulator dumps and shorts his own stock. In one recent case, the intricacy of one promoter's trading got so complex that he relied on computerized buy/sell signals so he, himself, didn't lose his shirt.
26. AXIOM OF FREE STOCK. Everyone would love to get free stock. Clever speculators, insiders and stock promoters are generally those that actually DO get free stock. Insiders simply blow out all of their paper into the strength of any liquidity and then re-load with stock options and/or warrants, maintaining their stranglehold on the company while lining their pockets. Stock promoters secretly demand under-the-table share certificates, channeled usually through an "independent" third party into a hidden account. Successful speculators monitor stock charts, buying low and selling most (or half or all) of their position, wait for the stock to retreat, and then re-load. There's no free lunch in this business. All of the above takes work. IF all speculators/investors knew this, there would probably be less market manipulation, or at the very least, market manipulators would have to come up with a new bag of tricks.
27. LAW OF NAME-DROPPING. In an effort to strengthen bidding in a stock, promoters and insiders may claim a BIG name is getting behind the company, i.e. a famous (wealthy) individual is buying the stock (lots of it), a big-time promoter is getting behind the stock, a highly regarded analyst will recommend the stock, or a well-known newsletter writer will bring his subscribers into the stock. It's all just "noise," generated by the promoters so they can prop up their share price and offload their on paper. This law is a variation of the next law.
28. LAW OF THE TAKEOVER. If you hear there is going to be a takeover, someone is offloading their position in that company and anticipates doing so at a higher price. Takeovers are done quietly and carefully so that the conquering company doesn't have to overpay for their shares.
29. AXIOM OF THE LEAK (RUMOR). Any rumor is manufactured by an insider or stock promoter in order to dump their position onto the gullible. Unless one is a prankster.
30. LAW OF THE MEDIA. The Media are the last to know about anything. No one in their right mind trusts or likes the media. The media, in order to appease the regulators, only report bad news and routinely challenge or distrust good news and put a "bad news spin" on good news. Further, the media distrust anyone who makes more money than they do, especially the guy who owns the newspaper.
31. SECRET OF INVESTMENT CONFERENCES. These occur at a hotel or convention center where insiders and promoters exhibit their wares and praise their company's future in order to dump part or all of their stock position onto investors, stockbrokers and money managers who don't know any better.
32. AXIOM OF MOTIVATION. When properly motivated, stock promoters can create "miracles", if only temporary in the share price appreciation. Generally, the greater the payoff, the more liquid the trading volume. Signs to look for include lucrative investor relations contracts and/or plenty of stock promoters all touting the stock to their groups. Nothing replaces the best motivation of all, for the insider, like private placement paper becoming free trading.
33. SECRET TO QUICK MONEY. The quicker you try to make your money, the faster you lose it. Quick money is usually made dishonestly (drug dealing, racketeering, insider trading, etc.) or in a lottery. Nothing replaces burning the midnight oil, long hours of toiling, effective data gathering and data analysis and bright ideas. Many try using short-cuts, which ultimately become
dead ends.
34. THE TRUTH ABOUT MOTHERS. Everything your mother ever told you about life, applies to the stock markets. Everything parents told their daughters about boys also applies to stock promoters.
35. LAW OF ORPHANS. No one is willing to own up or take responsibility for a disastrous crash in a stock or a failed stock promotion. Whenever there is a major success story, everyone takes credit for that company's success. The further you are out of the loop, the harder it will be for you to determine who was responsible for a company's success or failure.
36. FLAVOR-OF-THE-MONTH AXIOM. No individual ever survives as a Flavor of the Month. One can have an enviable string of successes, but eventually the insiders, shortsellers or stock promoters will destroy him. Failing that, the media will ruin him. Failing that, the regulators will handcuff and gag him, or even jail him. No one has ever survived past all of those roadblocks. Each roadblock wears the superstar down to the point, where he can no longer think straight and wonders if "all of this is worth doing anyway." Flavors-of-the month, like ice cream, eventually melt down to a dribble.
37. THE SECRET OF THE NEWSLETTER WRITER. Any newsletter writer providing ongoing reportage on Canadian mining or small cap stocks has a vested interest, whether disclosed or not. Someone is paying the freight and rarely is it the subscriber. (The writer either has a position or is being paid or hopes to become "famous" by covering a specific stock.) Publishing a newsletter is a very expensive proposition, with a high casualty rate. Look at which "popular" newsletters were published during the late 1960s or the early 1980s and see if any are still being published today.
38. AXIOM OF SECRETS. If there really is going to be a big discovery or a big contract or a big deal, the stock promoter or insider will never tell you first, if at all, until the news is made public. He knows it would be illegal to give you inside information so he won't. Whatever he does tell you may have no bearing in reality. The more desperate the promoter, the more outrageous the promises; the more incredible the deal.
39. THE SECRET TO HOWE STREET. All any of these stock promoters want to buy with the profits they make off you is this: Respectability. Instead, they buy drugs and booze. They utterly lack any self-respect, from the best to the worst. They are criminals who have whistled past the graveyard, more times than a cat with nine lives, praying that they can avoid being caught. At the very best, they hope to parlay their worthless share certificates, through a somewhat credible promotion, into bigger real estate and cash. At their worst, they merely wish to cover their annual bar tab. The average person, whom they routinely fleece, has far more self-respect than any of these promoters will ever achieve. None of them will ever become respectable, especially not in their own minds. This absence of self-respect may help explain the rampant alcoholism and drug abuse among stock promoters in Vancouver.
40. THE LAW OF MONEY. History shows us that Money is attracted to the individual who can effectively and articulately communicate. Stock promoters routinely can repeat a good story. The most successful speculators are those whose communications skills match or surpass the best promoters. The best CEO is the most effective communicator.
41. AXIOM OF TECHNICAL ANALYSIS . Technical analysis does not deceive the speculator. A stock promoter's worst enemy is the stock chart. Correctly interpreted stock charts never lie, although many speculators have no clue as to how to read a stock chart. Analysis may also vary from chartist to chartist.
42. THE HYPE FACTOR . Hyperbolic statements can artificially inflate a stock's price, temporarily. Long enough for a shortselling syndicate or a group of professional traders and insiders to reap huge rewards. Often, a combination of a speculator's naiveté and his enthusiasm about a company can lead to "over the top" statements. Eventually, he learns his lesson. Stock promoters favor newsletter writers who are inexperienced in the business, as they can be told what to write and are eager to be offered that opportunity.
43. THE LAW OF SEASONS. When it comes to mining plays, buy in December and sell in May. Buy when the promoters are out of town; sell when they are in full swing.
44. AXIOM OF DRILL RESULTS. Buy when the drill goes down; sell when the shaft comes up. In other words, the heady promotional statements and expectations are issued during the drill campaign and while awaiting assays. That is when a speculator most likely benefits from a stock's runup. Because most drill results are disappointing, the smart speculator is completely out of his position before the assays are announced.
45. THE LAW OF NEWS RELEASES. Buy on mystery, sell on history. Buy on rumor, sell on the news. These are well-worn clichés that rarely disappoint. Occasionally, a company's stock will run strongly after a news release. In the small cap stock sector, most news releases are a promotional device, used by insiders, to generate fantastic trading volume so they can exit a portion of their position.
46. THE SUCCESS FACTOR. Most mining success stories are complete accidents. On the order of a "Jed Clampett" finding oil in the TV series, "The Beverly Hillbillies." With many important discoveries, throughout the history of mining plays, one or many insiders had virtually blown out of their entire position and/or were shorting their own stock, in anticipation the company's drill results would be a disappointment. Part of the stock's runup might also have included covering their shortselling and obtaining a fresh, new position.
47. AXIOM OF NOISE . The more noise you hear during a stock promotion, the harder the stock will fall when the promotion is completed. Stock promoters are only interested in trading volume, for share-dumping purposes, which can only be created with a series of loud bangs in the media world. Generally, by the time you hear about the stock, the runup is over and the distribution phase has already started, followed by a slow or abrupt decline in the share price.
48. THE LAW OF LIARS. They repeat their lies and falsehoods again and again and again. They don't just tell one white lie and feel guilty. They lie in every aspect of their life. One can use this against the liar by doing the exact opposite of what he tells you to do. Liars are suckers for other liars.
49. AXIOM OF TRADING VOLUME. Trading volume is increased solely to distribute a large position from a single shareholder, or a few shareholders, to the masses. All an insider ever wants is trading volume so he has enough liquidity into which to dump his position. This is the only reason stock promoters are hired.
50. THE ULTIMATE RULE. Paper is paper and cash is cash. The only reason you are holding paper instead of cash is you honestly believe your paper will eventually be worth more than the cash. Amateurs buy paper. Professionals convert their paper to cash. Cash is King. Paper is essentially worthless if there are no buyers.
Conclusion...
This essay was not intended, but may serve, as a sociological study of the criminal minds at work within the financial marketplace. Speculators also have to agree to be criminals, to a degree, in that they expect something for nothing. The essence of the criminal is to get something for nothing. While theft, larceny, insurance fraud and burglary are broadly condemned within this society, it appears perfectly "all right" for the speculator to swoop into and out of a stock, for a quick profit. That is pickpocketing, plain and simple, and should be branded as such. Thus, it is no great surprise, to me, that an increasing number of the Internet "gurus" have told me they'd like to launch their own deal, i.e. to become an insider or stock promoter, themselves. It is a quick slide into the loony bin for anyone aggressively speculating in these markets.
The entire problem of the small cap stock market is the illegal transfer of wealth from the naive investor to the sophisticated trader. Institutional fraud runs uncontrolled throughout the fabric of these markets. Bribing stockbrokers appears to be the "only way to do business" in many circles. Bribing fund managers is nearly mandatory if a mining company wants European financing. What amazes me is that October's FBI sting of insiders and stock promoters wasn't even the tip of the tip of the iceberg -- they didn't even scratch the surface, nor did they nab the key figures. For all the hoopla and the celebration of the regulators over the recent successes in "stopping fraud," they all know, too well, that hardly a dent occurred. The actual depth of the amount of stock fraud, outright deception, bribery and dishonesty in the financial markets is far greater than any securities regulatory body is willing to admit. They know about the fraud -- but then, they have "their future" to look out for, as well. There's a job at Merrill Lynch, Charles Schwab, Canaccord or Smith Barney waiting for them. It's OK to "get the little guy," but they know better than to tangle with the powers that be, which run the financial markets from New York to Tokyo, from London to Vancouver, and everywhere in between.
Essentially, the securities regulators hold their esteemed positions, and are backed by their respective state/provincial/federal governments, for no other reason than to ensure that the small investor CONTINUES to get screwed every which way but Sunday. For if all the small investors always made a profit in their investments or speculations, the poor professionals wouldn't be able to steal as handsomely as they do now. This may also explain why market makers continue to FREELY rape small companies, while the regulators focus their attention on the stock promoters and insiders.
It is a dirty business, one which is filled with rotten tricks. The intricacies of the scams, which are run on the innocent investor, is the subject for a future essay.
by George Chelekis.
original post by ponokee (courtesy of alanc)
no it would be OT across a few levels
that said it's not rocket science to ascertain *entities*
basic caveat i never forget >> money is made both ways by the PROS
on the poorly watched (but heavily manipulated) OTC b4 *most*
(wonder why trolls can post 99% are >> er >> *scams*) OTC stox
are no longer *viable* and relegated to the cellar to *DIE*
==
4kids
all jmo
Are we allowed to share the real names and addresses of conniving short and distorts here ?...maybe some aliases from "other" boards ?
Please say yes.
: )
I would reckon that shoots down the NO SHORTS THeory pretty good !! Humm???
oh ok .. you can click on sticky post (no. 1)
that has the link for daily reg sho >> scroll
down left side to ORF >> and click on today's date
http://regsho.finra.org/FORFshvol20120926.txt
that will bring you up the list .. a quick glance
looks to me that SLNM is not on the daily reg sho
as for the *legal* short >> this is what was just reported
(in arrears) (that is the media date)
http://www.otcbb.com/asp/OTCE_Short_Interest.asp
you can enter the ticker and note what is what
i find OTC MARKETS (a for profit site to be only worthwhile
for their compilation of this data) easily accessed ..
http://www.otcmarkets.com/stock/SLNM/short-sales
someone is stuck on 58 and 100 :)
===
4kids
all jmo
SLNM up 37% I was wondering any short volume today
not sure what you are asking
but if it's for me to watch SLNM
via rt l2 >> i'll be more than happy
to track it via equity feed over the
coming weeks and take note of which MMs'
are *active*
==
4kids
all jmo
Could you put any short on SLNM..thx
thx for the info >> i'll add MINE to my list to watch (rt l2)
via equity feed
remember with reg sho it's the info shown over weeks and months
(pattern) that matters .. when i've had a chance to observe MINE
for a few weeks i'll post some thoughts to you
(i'll also track the MMs' *active* and what is reported to finra)
that info for sept is due out next monday
==
4kids
all jmo
fourkids ~MINE~ 15.4M float, 12.5 M shorted last 3 days!
heres the numbers link ORF!
http://regsho.finra.org/regsho-Index.html
Lawsuit: Incompetent SEC Struggles To Rein In High-Speed Trading Fraud
Posted: 09/24/2012 1:35 pm
Having the Securities and Exchange Commission police high-speed trading is like pitting Barney Fife against Michael Corleone: The odds are not in its favor.
You might think it unfair to compare the SEC to the bumbling deputy sheriff of Mayberry, who couldn't be trusted to carry a loaded gun. But the Andy Griffith Show wiki reminds us that Fife was not totally useless: There were occasions, like that time he stood up to those farmers, when he showed backbone. Same thing with the SEC, which has managed to tear itself away from the pornography long enough extract some big fines from Wall Street after the financial crisis.
But the agency is clearly outgunned when it comes to dealing with high-frequency trading, many experts agree. And a new lawsuit goes so far as to accuse the SEC of covering up high-speed fraud so nobody will know just how incompetent it really is, Courthouse News reports.
In the suit, a Wisconsin company called EMM Holdings accuses the SEC of not investigating a Houston high-speed trading firm called Quantlab Financial. According to EMM, Quantlab is perpetrating fraud amid all the high-speed churning and burning it does in the stock market. EMM notes that Quantlab has been flagged six times in the past eight years by the Financial Industry Regulatory Authority, the brokerage industry's self-regulatory body, for not properly documenting its trades. EMM thinks this is evidence that Quantlab is trying to cover up some fraud, and it has asked the SEC for any documents showing an investigation of Quantlab. The SEC has refused, on the grounds that doing so might interfere with law-enforcement activities. EMM has sued the SEC to force it to give up whatever goods it has on Quantlab.
Trouble is, it's not entirely clear if the SEC is actually investigating Quantlab at all. EMM argues in its complaint that the only way the SEC could deny its record request is "if there is an on-going and active investigation." And EMM accuses the SEC of letting this investigation fester, hoping the statute of limitations will run out.
"Given [the SEC's] near complete abdication of its prosecutorial duties during the 2008 financial crisis, inaction and delay may unfortunately have become [the SEC's] modus operandi for dealing with complex financial malfeasance," EMM said in its complaint.
The SEC says it conducts all of its investigations privately and would not comment when asked whether its denial of EMM's request for documents amounted to an admission that it really is investigating Quantlab.
Quantlab did not immediately return a request for comment, but it has previously denied allegations of fraud.
It is worth noting that this appears to be the latest in a long drama involving Quantlab and Emmanuel Mamalakis, the principal of EMM Holdings. About five years ago, Mamalakis formed his own high-speed trading firm, called SXP Analytics, with a couple of former Quantlab employees. Quantlab accused them of stealing its secret high-speed trading recipe. The two parties have been brawling in court ever since.
But even if Mamalakis has an ax to grind, he's probably on to something when it comes to the SEC's ability to keep an eye on high-speed trading. And that's a huge problem, given the outsized influence high-speed traders have on our financial markets.
A new Chicago Fed study last week detailed how flash-trading robots have triumphed over financial markets, making up the majority of global trades in stocks and stock futures and huge chunks of the global foreign-exchange and bond markets.
The Chicago Fed study pointed out that high-speed-trading firms can barely control their own robots, a fact noted by Robert Oak of the Economic Populist blog:
Chicago Fed staff also found that out-of-control algorithms were more common than anticipated prior to the study and that there were no clear patterns as to their cause. Two of the four clearing BDs/FCMs, two-thirds of proprietary trading firms, and every exchange interviewed had experienced one or more errant algorithms.
If the market's robot masters can't handle their own algorithms, then surely the regulators, who are paid less and have worse technology, probably can't do it, either.
That makes it all too likely that we will get more Flash Crashes and Facebook IPO flops in the future, further eroding investor confidence. And it means plenty of opportunity for fraud, as high-speed traders blow through millions of trades in seconds -- long before Barney Fife can even get his single bullet into his gun
http://www.huffingtonpost.com/mark-gongloff/sec-high-speed-trading-fraud_b_1909821.html?utm_campaign=092412&utm_medium=email&utm_source=Alert-business&utm_content=FullStory
====
original link/post courtesy of playingthegame
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=79892700
watching to see if knight's implosion on 8.1.12
gets scooped up by GS or Citadel or another entity entirely
==
4kids
all jmo
How about a stock that has 3.3MM float, has retired 75MM shares to bring the issued and outstanding down to 44MM, and has 2 of 287 shareholders in possession of 55MM shares?
Do you think there is an inventory problem?
Yes a situation like this DOES exist!
Market makers and retail brokers have been issuing counterfeit inventory for years! The are no FTD's because nothing is being generated with their internal book entry swaps.
The best part of the whole equation are the non-diclosing demoters who work for the market makers, brokers, bankers, and maybe even the DTCC to protect their phantom positions.
I agree, about the NSS issue
they say
" we need NSS cause it gives LIQUIDITY "
BULL SHIT.....
with an electronic system . we dont need NSS,
the NANO SECONDS computer will find a share
to borrown , period..... they can SHORT IT like
it was intended to, NSS is NOT NEEDED PERIOD,
1 day cover , or get rid of it
they want to CRASH THE PRICE AT ALL COSTS
way to soon, its Ridicoulous, really,
azz holes
cheers
gr
Exactly, they are supposed to report End of each day, but it doesnt happen like it should.
I would short too, but like u said, the margin requirements are sometimes too high for me, but definately not too high for a market maker who can sell air shares into the bid knowing he is gonna be able to drive the price down.
NSS was banned in several other countries.
With an electronic system, nothing needs to be NSSed anymore. Back in the day it did since it was a manual system, but with electronic system nothing needs to be NSSed
So then , they are not
OBLIGATED as such, or not being
FORCED to report the shorting as
it was intended,
i would short, but the reuquirements
are not possible, so they have
a big advantage,
i think , as u agree,
1 DAY NSS to cover, that would
at least, REDUCE the shit...
but it aint happeingin
'
cheers
gr
the "reporting" of shorts is definitely under par imo.
Remember: Hedge Funds/Market Makers do majority of the shorting in penny land, they do not want to public to believe shorting pennies is doable or profitable.
So, just another way of screwing with us.
I noticed that on the SHort Volume info,
not all the days are recoreded,
many days are skipped,
is this normal
or just another way of skrewing us
cheers
gr
100% AGREED! NSS should be covered within 1 day
Can some1 explain, why some days
are not reported (shorts that is)
some OTC , or many, do not report
everyday, why is that ?
cheers
gr
I think this rule only applied
to Bank stocks, and only for
a short period of time
NSS i think came back,
not sure
but IMO
cherers
NSS, this to me is the REAL ISSUE,
now
if NSS is "legal" as long as its
not abusive, so as long as they cover,
within the time alloted, i believe 3 days,
how r we going to get this practice
REMOVED from the industry.?
i say, let the NSS be legal, but with 1 day to cover,
so cover must take place the following biz day.
that should SQUEEZE them a ltittle,
this will make the NSS profits more difficult and
allow the company more room and time to make there
company go
or
make NSS I L L E G A L period
otherwise we are wasting our time
imo
cheers
gr
Accidentally Released - and Incredibly Embarrassing - Documents Show How Goldman et al Engaged in 'Naked Short Selling'
Read more: http://www.rollingstone.com/politics/blogs/taibblog/accidentally-released-and-incredibly-embarrassing-documents-show-how-goldman-et-al-engaged-in-naked-short-selling-20120515#ixzz1xbl5J8Zc
==
4kids
all jmo
==
excellent insight >> thanks for the read alan
==
4kids
all jmo
A LOOK BACK AT THE P&D OF '04-'05
Issued and outstanding on Dec 31, 2003 7,600,000,000
On April 27, 2004 the Company executed a 200:1 forward stock split which has been retroactively applied to these
statements and accompanying notes.
Issued and outstanding on Dec 31, 2004 12,773,014,285
2004 TRADING TOTAL VOLUME 15,656,000,000
The P&D did not begin until Dec 3 of 2004 (AFTER THE 200:1 SPLIT) when the following price and Volumes:
DATE==========VOL========LOW=====HI=====CLOSE====$BASED ON .001
Dec 3===== 783,429,200==.0001===.0002===.0001======$78,343.00
Dec 6===== 354,120,400==.0001===.0013===.0013======$35,412.00
Dec 7====1,408,867,000==.0010===.0038===.0016=====$140,887.00
Dec 8====1,402,166,000==.0010===.0022===.0013=====$140,217.00
Dec 9===== 949,801,700==.0008===.0110===.0010======$94,980.00
Dec10====1,466,555,000==.0005===.0022===.0006=====$146,666.00
PEAKING ON DEC 20,2004
Dec20====1,713,665,000===.0019===.0320===.0028====$342,720.00
13B in Dec '04 ALONE
3B in Jan '05 ALONE
ENDING ON FEB 04,2005 (CEO CONFESSED TO LIES)
Feb01=====182,934,700===.0010===.0014===.0011
Feb02=====107,751,700===.0009===.0012===.0010
Feb03======79,545,660===.0009===.0012===.0010===$79,545.00
Feb04===1,778,055,000===.0002===.0030===.0003==$355,610.00(.0002)
Feb07=====219,918,000===.0002===.0004===.0003===
I DON'T BELIEVE THE 'SHORTS' WERE EVER SCARED INTO 'COVERING'
Issued and outstanding on Dec 31, 2005 15,000,000,000
2005 TRADING TOTAL VOLUME 9,449,000,000
Anger at Goldman Still Simmers
By GRETCHEN MORGENSON
Just before the financial crisis began in September 2008, a prominent hedge fund appeared well positioned to take advantage of any turmoil in the markets. That fund, Copper River Partners, had made sizable bets months earlier against companies whose stocks it expected to suffer.
Within weeks, however, Copper River, once a successful $1.5 billion hedge fund, was out of business, having unexpectedly absorbed losses on the very bets it thought would be profitable. While the market turmoil contributed to its problems, Marc Cohodes, head of Copper River, says that a significant force behind the failure was Goldman Sachs, which for years had been the firm’s broker.
Testifying recently in a lawsuit that is unrelated to Copper River’s closing, Mr. Cohodes maintained that actions taken in the fall of 2008 by Goldman in the handling of trades for Copper River had done irreparable damage to the fund. His testimony, which has not been made public, was obtained by The New York Times.
Copper River relied on Goldman to handle its negative bets, known as short sales, in compliance with securities laws. These regulations require that before a short sale can be made, the shares must be borrowed; Mr. Cohodes said his fund had paid Goldman approximately $100 million to borrow shares over many years.
In his testimony, Mr. Cohodes said he and his partners at Copper River had even come to wonder if Goldman had in fact borrowed the shares for the firm. Without the shares, Copper River faced losses, while Goldman could have come under regulatory scrutiny.
When asked whether Goldman had borrowed the shares, Michael DuVally, a Goldman spokesman, said: “Mr. Cohodes is wrong. We met our obligations under applicable law.” He added that Copper River’s problems were the result of the extreme stress in the financial markets at the time.
Goldman has sought to seal the transcript of Mr. Cohodes’s deposition, which is part of a case brought by Overstock.com, an Internet retailer, against two of the biggest Wall Street firms. Overstock contends that the firms — Goldman Sachs and Merrill Lynch — failed to borrow company shares that they or their clients sold short, a practice known as naked shorting. Overstock says that the firms essentially evaded rules intended to prevent stock manipulations, and that its stock came under outsize selling pressure as a result.
Both of the firms sued by Overstock have denied the company’s accusations. They have requested that the judge overseeing the case seal all the documents generated in the discovery process, contending that their release would disclose trade secrets about the business, known as securities lending, which is highly profitable for the firms. The Times has joined three other media companies in asking the court to unseal the documents. Mr. Cohodes’s deposition, however, is not subject to the seal.
Earlier this month, John E. Munter, the judge overseeing the case in California state court, ruled that many of the documents should be made public. The firms are expected to appeal the ruling.
Mr. Cohodes declined to comment beyond his deposition or to explain why he had not sued Goldman over his fund’s losses. He has left the money management business and now raises chickens on his farm in Northern California. As an investor who often bet against companies, he drew the ire of many of his targets’ executives and shareholders. That he is a straight-talking man who enjoys the combat comes through in his testimony.
Mr. Cohodes is not a party in the Overstock lawsuit and has had a longstanding adversarial relationship with the company, whose stock he bet against. When asked in the deposition if he wanted to help Overstock, he replied, “Oh, absolutely not.”
Goldman’s handling of its clients has been a hot topic since the credit bubble burst. The firm’s creation of Abacus, a mortgage security that was meant to fail but was sold to the firm’s clients without disclosing that fact, was the subject of a $550 million regulatory settlement and Congressional hearings.
More recently, a Goldman executive named Greg Smith resigned from the firm and wrote a scathing Op-Ed article in The Times. Mr. Smith contended in his open letter to the firm’s top management that its culture had become toxic and that it had placed its own interests ahead of its customers’. Goldman denied the claims and contended that its customers came first.
Mr. Cohodes’s testimony in the Overstock case provides new details of his fund’s surprising demise in the market rout. At the time Copper River closed, he only alluded to his problems with Goldman. In an early October 2008 letter to investors describing the September turmoil, he said that “counterparties did not provide the level of business support that they have in the past,” something that exacerbated losses.
While few investors understand or care about the mechanics of securities lending, the area has come under increased regulatory scrutiny. The Securities and Exchange Commission has brought several cases in recent years accusing market participants of failing to borrow shares they or their customers had sold short, improperly creating a supply of additional stock to sell.
Along with a handful of traders at smallish firms, Goldman’s securities lending unit has been cited by regulators for lapses. In 2010, the S.E.C. sued Goldman on accusations that it “willfully” had failed to preborrow shares as required for its short-selling clients in January 2009, shortly after Copper River went out of business. The improprieties involved 385 short sales in which the firm had not located shares for its brokerage clients to borrow.
Goldman paid $450,000 to settle the case without admitting or denying the accusations.
Failing to borrow shares on behalf of customers is illegal because of concerns about market manipulation. But it can also leave a brokerage firm’s client who is short a stock dangerously exposed to an escalating price in the shares. If a stock shorted by an investor began to trade higher and the shares were not borrowed, closing out the transaction would require the fund to buy them in the open market. That could propel the already rising price of the shares even higher, adding to the costs of the trade.
Mr. Cohodes, who worked at the hedge fund for 25 years, testified in the Overstock case because his firm had placed short bets on that Internet company’s shares during the mid-2000s. In 2005 Overstock sued Copper River for stock manipulation, seeking $1 billion in damages. Copper River denied the accusations but settled the matter in late 2009, paying $5 million.
In his Overstock testimony, Mr. Cohodes described Goldman’s role as the primary brokerage firm used by Copper River from 2004 through October 2008. Goldman conducted many of Copper River’s trades and was relied upon to locate all the shares the firm needed to borrow before it bet against companies.
According to Mr. Cohodes’s deposition, Copper River often sold short shares that were hard to locate for borrowing purposes and therefore extremely costly. As such, Copper River paid Goldman handsomely to make sure its trades complied with securities laws, Mr. Cohodes testified. He was unhappy about these fees, he said, but assumed that they were the cost of doing business and that Goldman was charging the market rate for following the rules.
“I view stock loan sort of as the Mafia,” Mr. Cohodes said in his deposition. “It’s a black box where you don’t know people’s inputs and costs, and it was sort of: ‘Here’s the rate. If you want to borrow it, this is the rate.’ And it is what it is.”
As an investor, Mr. Cohodes had long expected a stock market correction to result when the overheated mortgage market finally cooled. By mid-2008 he had put on sizable bets against companies that he thought would suffer in such a rout, he testified. One was American Capital, an investment company; others were the Open Text Corporation, a company that offers intranet applications, and Jos. A. Bank, a men’s clothing store.
When Fannie Mae and Freddie Mac collapsed in early September 2008 and the stock market began to fall, Mr. Cohodes thought that his firm was well positioned to profit from the downturn, he recalled. His troubles began after Lehman Brothers failed; Copper River’s funds at the firm were suddenly frozen. Then government regulators changed the rules governing short-selling, banning the practice altogether in shares of roughly 800 financial companies and decreasing the amount of time allowed for such trades to settle.
This caused a violent rally in these shares. But the stocks that made up Copper River’s largest short positions were not on the short ban list.
Nevertheless, the stocks climbed, and Goldman began requiring Copper River to unwind its short positions by buying back the shares. This upset Mr. Cohodes, he said, because the firm’s account was in compliance with its federal regulatory margin requirement. Moreover, the fund was not leveraged; it had not made its bets using borrowed money.
Instead, he said, he suspected that Goldman had never borrowed the shares for Copper River’s short positions and was trying to close out the trades to eliminate the problematic naked short positions. Because Goldman had a duty to borrow the shares, it could have risked regulatory questions about compliance, under Mr. Cohodes’s account.
Mr. DuVally rejected this argument. “Significant losses and a drop in position value caused the Copper River accounts to incur risk calls in September 2008, which it did not adequately address,” he said. “As a result, we declared an event of default, which entitled us as prime broker to require liquidation of the account.”
Desperate to save his firm, Mr. Cohodes said he began working to transfer his account to another bank, BNP Paribas. Goldman refused to release Copper River’s positions, he said.
When he discussed having another fund, Farallon Capital, take over Copper River’s short positions, Goldman thwarted that transfer as well, Mr. Cohodes testified. Farallon’s chief financial officer had told Copper River that an unnamed trader on Goldman’s proprietary desk had warned him not to take the hedge fund’s positions because it would “be out of business in a couple of days anyway,” the deposition said.
Greg Swart, the chief financial officer at Farallon, declined to comment.
As the stocks continued climbing, Mr. Cohodes came to believe that Goldman was buying the stocks that he was short ahead of him, driving up their prices and making Copper River’s short-covering purchases even more costly, he testified.
Mr. Cohodes continued: “The stock market was literally falling apart, going straight down. And our short positions would have benefited hugely by the market falling apart and melting down. But the stocks that we had to cover were all going straight up in violent fashions in a straight-down market.” Someone, he said, was driving up his price.
Mr. DuVally of Goldman said in response, “We looked into these front-running allegations, and they are not true.” He added, “We conducted the liquidation in a manner designed to limit, to the extent possible in an extremely volatile market, losses in Copper River’s accounts.” He declined to say why Goldman did not allow Copper River’s accounts to be transferred.
It is possible, of course, that other investors knew of Copper River’s short trades, figured that the fund was in distress and rushed to buy the stocks the fund was covering. But the warning call to Farallon from Goldman’s proprietary desk indicated to Mr. Cohodes that the Wall Street firm was front-running Copper River, he said.
As soon as Copper River’s short trades were closed out, the stocks it had focused on began plummeting, charts show. Most of the stocks peaked on Sept. 23 and started falling precipitously.
“I think Goldman Sachs is a racketeering entity that does whatever they can to make a dime without conscience, thought, foresight or care about ramifications,” Mr. Cohodes concluded in his testimony. “I think they are cold-blooded and could care less about the law. That’s my opinion. I think I can back it up.”
Goldman said Mr. Cohodes had been a satisfied Goldman customer who changed his view only after his fund experienced losses.
Copper River closed at the end of September 2008. The stocks it had been short soon collapsed.
http://www.nytimes.com/2012/03/26/business/goldman-sachs-denies-claims-it-led-to-copper-rivers-demise.html?ref=business&pagewanted=print
Could get interesting. SNVP 33mil short!? Huge volume purchased above .004...
CAN U SAY SQUEEEZE EM?
SNVP Huge volume the past two days totalling 91,295,452 shares traded. Of that 91 million, 33,841,803 are short.
SNVP float 87 million
Date|Symbol|ShortVolume|ShortExemptVolume|TotalVolume|Market
2012 03 23|SNVP|17164973|0|53358347|O
2012 03 22|SNVP|16676830|0|37937105|O
Not so subtle when you know the story
A HIGH??? OF .0006 WAS A PAINT JOB
HAS IT BEEN A POSITIVE OR NEGATIVE FOR PYCT???
Our 52 week high and low are currently .0006 and .0001
Any newby is going to see that and the fact we are mostly at .0001 and think we are a SCAM or P&D.
APRIL 01,2011========post 73291
Trade#1===09:51:55=======168,000===@BID===.0001
Trade#2===09:54:31=======420,100===@BID===.0001
Trade#3===09:54:31=====2,862,000===@BID===.0001
Trade#4===10:01:32=========8,000===@ASK===.0006
Trade#5===10:11:33========50,000===@ASK===.0006 Trade#6===10:16:22=======100,000===@ASK===.0002
Trade#7===10:31:20=====7,000,000===@???===.0001
Trade#8===10:31:38=====1,000,000===@???===.0001
Final 2011 FINRA============5,781,062,801
YTD (NOT INCLUDING JULY'S 630,517,736 )
@ UNDER .0001 for===99,779,344=====UNDER $9,978.00
@ .0001 for=======4,918,577,661=========$491,858.00
@ .0002 for========328,007,258==========$65,600.00
2@ .0004 for=========1,200,000=============$480.00
2@ .0006 for===========58,000==============$35.00
HISTORY OF THE P&D THAT NEVER COVERED
I believe they never covered after the P&D of 2004, check it out.
NITE HAS DONE A GREAT JOB OF 'MATCHING' ON THE DAILY SHORT VOLUME (DSV) REPORT. THEY TAKE THE MONEY, THEN 'SUPPOSEDLY MATCH' IN THE BACK SYSTEM. I DON'T BELIEVE THEY ARE MATCHING AT ALL.
MONTHLY TRADING VOLUME (with DSV TOTALS)
FEBRUARY '12==365,484,684====610,377,141(+15,900,000)======60%
JANUARY '12====37,761,111====230,332,618=====16%
DECEMBER=======74,486,599====231,931,404=====32%
NOVEMBER======267,434,751====663,009,358=====40%
OCTOBER=======337,318,550====581,713,427=====58%
SEPTEMBER=====151,778,051====395,862,250=====38%
AUGUST========306,431,886====627,780,529=====49%
JULY==========176,869,169====630,517,736=====28%
JUNE==========167,715,248====321,438,024=====52%
MAY===========198,641,948====340,594,545=====58%
APRIL=========324,898,044====547,476,598=====59%
MARCH=========505,627,471====960,171,558=====53%
FEBRUARY======115,754,193====167,535,100=====69%
JANUARY=======188,646,491====268,667,252=====70%
74,809,983,208 SHARE PRICE///VOLUME///O/S HISTORY
2012 TRADING YTD==========985,588,633
2011 TRADING TOTAL======5,781,062,801
2010 TRADING TOTAL======4,335,176,216
2009 TRADING TOTAL======6,892,355,558
2008 TRADING TOTAL======4,142,000,000
2007 TRADING TOTAL======6,221,000,000
2006 TRADING TOTAL=====21,348,000,000
2005 TRADING TOTAL======9,449,000,000
==========OVER 18 BILLION Between Dec 3,2004-Feb 7,2005
2004 TRADING TOTAL=====15,656,000,000
SINCE 2004 TOTAL=======74,809,983,208
YTD
014 @ UNDER .0001 for===24,149,902===UNDER $2,415.00
384 @ .0001 for========954,658,731========$95,466.00
008 @ .0002 for==========6,780,000=========$1,311.00
Issued and outstanding on Dec 31, 2003 7,600,000,000
On April 27, 2004 the Company executed a 200:1 forward stock split which has been retroactively applied to these
statements and accompanying notes.
Issued and outstanding on Dec 31, 2004 12,773,014,285
2004 TRADING TOTAL VOLUME 15,656,000,000
The P&D did not begin until Dec 3 of 2004 (AFTER THE 200:1 SPLIT) when the following price and Volumes:
DATE==============VOL==========LOW=====HI====CLOSE
Dec 3========= 783,429,200========.0001===.0002===.0001
Dec 6========= 354,120,400========.0001===.0013===.0013
Dec 7========1,408,867,000========.0010===.0038===.0016
Dec 8========1,402,166,000========.0010===.0022===.0013
Dec 9========= 949,801,700========.0008===.0110===.0010
Dec10========1,466,555,000========.0005===.0022===.0006
PEAKING ON DEC 20,2004
Dec20=========1,713,665,000===.0019===.0320===.0028
13B in Dec '04 ALONE
3B in Jan '05 ALONE
ENDING ON FEB 04,2005 (CEO CONFESSED TO LIES)
Feb01=========182,934,700===.0010===.0014===.0011
Feb02=========107,751,700===.0009===.0012===.0010
Feb03==========79,545,660===.0009===.0012===.0010
Feb04=======1,778,055,000====.0002===.0030===.0003
Feb07========219,918,000====.0002===.0004===.0003
I DON'T BELIEVE THE 'SHORTS' WERE EVER SCARED INTO 'COVERING'
Issued and outstanding on Dec 31, 2005 15,000,000,000
2005 TRADING TOTAL VOLUME 9,449,000,000
YEAR 2006
NOT REACHING ABOVE .0004 AGAIN UNTIL FEB 1,2006
BACK UNDER .0005 ON FEB 22,2006
A 5 DAY RUN UP IN MAY '06 (TO .0050) ON 1.25B SHARES
JUNE 16,2006 .0005 ON 288,571,100
OCT 23,2006 .0005 ON 222,172,200
DEC 2006 RANGE WAS .0003 TO .0006
Issued and outstanding on Dec 31, 2006 21,046,534,385
2006 TRADING TOTAL VOLUME 21,348,000,000
YEAR 2007
JUN 06,2007 HIGH===.0850 ON VOL==68,064,740 (close .0001)
SEP 26,2007 HIGH===.0300 ON VOL===6,159,999 (low UNDER .0001)
Issued and outstanding on Dec 31, 2007 17,140,990,045
2007 TRADING TOTAL VOLUME 6,221,000,000
YEAR 2008
JAN 164,000,,000
FEB 232,000,000
MAR 3,053,333 ***** YES, M/E total traded only 3,053,333
Issued and outstanding on Mar 31, 2008 19,650,000,000
APR 697,000,000
MAY 1,210,000,000 **** PILLAY ANNOUCES FLUSHAWAY DEAL ****
APRIL 24,2008 THRU MAY 9,2008 .0003 AND .0004 WERE COMMON HIGHS
MAY 9,2008 LAST DATE WITH REACHING .0003
JUNE 408,000,000
JULY 583,000,000
AUG 139,000,000
SEPT 174,000,000
OCT 157,000,000
NOV 93,000,000
DEC 282,000,000
DEC 11,2008 .0010 ON 165,467,400
Issued and outstanding on Dec 31, 2008 19,650,331,340
2008 TRADING TOTAL======4,142,000,000
YEAR 2009
JAN 86,000,000
FEB 1,287,000,000
FEB 19,2009 .0005 ON 68,598,000
MAR 444,000,000
APR 162,000,000
MAY 156,000,000
MAY 26,2009 .0003 ON 9,690,001
JUNE 64,000,000
JULY 92,000,000
AUG 1,115,000,000
SEPT 1,598,000,000
OCT 345,000,000
NOV 270,902,918
DEC 1,145,585,581
2009 TRADING TOTAL======6,892,355,558
Shares returned from AUDIT================2,200,000,000
Issued & Outstanding as of DEC 31,2009 :==== 21,850,331,340
YEAR 2010
JAN 279,561,694
FEB 291,668,361
MAR 658,416,052
APR 328,570,599
MAY 294,508,600
JUN 203,916,015
JUL 44,705,682
AUG 28,667,494
**** SHARES O/S 22,250,331,340 ****
SEP 73,522,679
PILLAY RESIGNED OCT 1st
OCT 1,055,688,279
NOV 742,845,514
DEC 336,678,247
Shares for DEBT=($40,000.00)===============400,000,000
2010 TRADING TOTAL=====4,335,176,216
Issued & Outstanding as of Dec 31,2010:===== 22,250,331,340
YEAR 2011
JAN 268,667,252
FEB 167,535,100
MAR 960,171,558
APR 547,476,598
APR 1, 58,000 SHARES SOLD AT .0006 FOR 52 WK HIGH (post 73291)
MAY 340,594,545
JUNE 321,438,024
Share returned from AUDIT==================124,014,285
Issued & Outstanding as of June 30,2011:===== 22,374,345,625
JULY 630,517,736
AUG. 627,780,529
SEPT 311,612,654
Shares for DEBT=($16,092.00)================160,919,311
Preferred to Common=(180K Preferred)=======1,800,000,000
Preferred to Common=(65K Preferred)=========650,000,000
Given to Liani for continued FIN Support=======3,000,000,000
Issued & Outstanding as of Sept 30,2011:===== 27,985,264,936
OCT 581,703,017
NOV 667,009,558
**** buy back 100MILLION....SHARES O/S 27,885,264,936****
DEC 231,931,404
**** buy back 100MILLION....SHARES O/S 27,785,264,936 ****
2012 626,125,647
**** buy back 100MILLION....SHARES O/S 27,685,264,936 ****
PREFERRED SHARES AS OF SEPT 2011.........755,000
2011 TRADING TOTAL=====
=====2,815,598,401====5,781,062,801==========49% UNMATCHED
TRYING TO PROVE A HUGH NAKED SHORT IN MY STOCK
The missing link is WHAT EXACTLY DOES THE 'SHORT INTEREST REPORT' SHOW.
Does it show the count of Naked shorts, Shorts that have been borrowed, does it check the date (if not T+3, it's not FTD), Could a marker be on the shares indicating they have been 'properly shorted' and the date changed (reborrowed), the day before the report is to be run. Therefore showing NOTHING.
ANY INFO WOULD HELP, as the company has an OS of 28B and traded 75B since 2004.
THANKS, GLAD I FOUND THIS SITE
I HAVE TRACKED AUGUST 5,2009 - MAR 2,2011 (DAILY)
**********MINUS 4 months
SHARES TRACKED SINCE AUG 5,2009=======15,014,946,818
==1,468,752,684 traded UNDER .0001====VALUE==under $146,875.00===9%
=12,707,129,370 traded at .0001========VALUE======$1,270,713.00===86%
====837,065,764 traded at .0002========VALUE======$167,405.00
UNDER 2,000,000 traded OVER .0002====VALUE==========$100.00
MMs HANDLING SALE OF SHARES 2009/2010/2011
Final 2009 FINRA============6,892,355,558
Final 2010 FINRA============4,335,176,216
Final 2011 FINRA============5,781,062,801
36 MONTH TOTAL ==========17,008,594,575
THE AX----NITE
============2009============2010===========2011========TOTAL
NITE====3,634,226,823======2,789,015,908===4,727,586,852===11,150,829,583
DOMS===2,378,533,900=====1,285,378,123========000,000====3,663,912,023
ETMM====420,458,745==========215,000========000,000=====420,673,745
VFIN=====260,332,173=======222,500,000=====990,863,949====1,473,696,122
HDSN=====98,340,888========30,112,085======51,576,000=====180,028,973
OTHERS==100,000,000=======10,000,000======11,000,000======111,000,000
2011 ACCUMULATED TOTAL DSV (Daily Short Volume) REPORT FOR YEAR
=====2,815,598,401====5,781,062,801==========49%
2012 YTD TOTAL Share Volume 672,905,040
NITE====534,565,535===1===79=======755,783,153===1===83
VFIN====111,875,005===2===16=======119,865,005===2===13
VNDM====26,200,000===3===3=========26,200,000===3===2
ETMM ==============================1,000,000===4===<1
HDSN=======250,000===4===<1==========250,000===5===<1
FOMA================================125,000===6===<1
YLPL========14,500===5===<1===========14,500===7===<1
MY TRACKING TOTALS (slightly off)
DSV==373,852,682====656,990,540(+15,900,000)======57% of volume UNMATCHED within 30 seconds of start of trade
FEB. MTD
011 @ UNDER .0001 for====23,009,902===UNDER $2,301.00
249 @ .0001 for=========642,140,638========$64,214.00
008 @ .0002 for===========6,780,000=========$1,310.00
YTD
014 @ UNDER .0001 for===24,149,902===UNDER $2,415.00
351 @ .0001 for========857,609,631========$85,761.00
008 @ .0002 for==========6,780,000=========$1,311.00
Hey peeps... so what is this board about??
SEC changes fraud settlement policy
Jan. 6, 2012, 3:17 p.m. EST
By Ronald D. Orol
WASHINGTON (MarketWatch) - The Securities and Exchange Commission on Friday changed how it settles securities fraud cases involving criminal convictions, telling corporations that they will no longer be permitted to say they neither admit nor deny the SEC's civil charges at the same time that they have been convicted in a criminal case. In the past, a defendant could have been found guilty of criminal conduct and settle parallel SEC charges while neither admitting nor denying civil liability, the commission said.
http://www.marketwatch.com/story/sec-changes-fraud-settlement-policy-2012-01-06?link=MW_home_latest_news
==
original post courtesy of alanc
==
4kids
all jmo
Followers
|
109
|
Posters
|
|
Posts (Today)
|
0
|
Posts (Total)
|
1349
|
Created
|
02/20/10
|
Type
|
Free
|
Moderator righty | |||
Assistants fourkids_9pets |
Welcome to The Shorts Exposed Board
Link for checking daily short volumes on Finra's regsho tracking site:
http://regsho.finra.org/regsho-Index.html
Check under ORF for OTCBB/OTC stocks
Link to track short volume by percentages:
Explanation of this rule by the SEC/Finra:
http://www.sec.gov/rules/sro/finra/2009/34-60807.pdf
SEC FAQ on REGHO Rule 200
http://www.sec.gov/divisions/marketreg/mrfaqregsho1204.htm
University of CinCinnati Law explanation of REGSHO rule 200:
http://www.law.uc.edu/CCL/regSHO/rule200.html
OTCBB Bi- Monthy short interest:
http://www.otcbb.com/asp/OTCE_Short_Interest.asp
Link for tracking Monthly Share Volume in your stock:
http://www.otcbb.com/dynamic/tradeact.htm
Link for tracking Nite's volume in every stock monthly:
Regulation SHO threshold security list:
http://www.nasdaqtrader.com/Trader.aspx?id=RegSHOThreshold
Anybody who can post a spreadsheet on their favorite stock is welcome:
Volume | |
Day Range: | |
Bid Price | |
Ask Price | |
Last Trade Time: |