Since it's the only thing they needed to do to avoid revocation, why would they perform the audit and then not file it?

"On January 12, 2003, CMKM Diamonds issued 994,083,000 shares to 360 people for "fieldwork in Canada."11 (Tr. 157-59; Div. Exs. 15, 26.) CMKM Diamonds also issued almost 3 billion shares to twenty-nine companies on January 22, 2003. (Tr. 87-89; Div. Exs. 16, 26.) On January 7, 2003, CMKM Diamonds announced that it was performing a shareholder audit designed to identify every shareholder of record. (Div. Ex. 29.) Two weeks later, the company announced that it expected the audit to be completed in the next few days. (Div. Ex. 30.) Given the company's recent issuance of shares, this shareholder audit would have determined that CMKM Diamonds had more than 300 shareholders of record as of January 2003."

Brenda P. Murray
Chief Administrative Law Judge

Well, they were only off by two years...

Of course CMKM Diamonds would consider it relevant.

That was the red herring they used to rip off investors.

"CMKM Diamonds's failure to file required periodic reports has deprived the investing public of current, reliable information regarding its operations, purported million-dollar transactions, and financial condition. Viewing the Steadman factors in their entirety, I conclude that the appropriate sanction for the protection of investors is revocation of the registration of CMKM Diamonds's securities."

Brenda P. Murray
Chief Administrative Law Judge

That was all that ever mattered. Fizzle was just giving you and the rest of the gulliblers a big run-around.

The SEC also knows that the existence, real or imagined, of a naked short position had nothing to do with Casavant's inability or unwillingness to file current financials.

That was the sole driving factor behind the revocation.

It is remarkable the way this scam recycles the same dullards over and over again.

She may not necessarily have been clueless. She may have been astute enough to recognize the issue as irrelevant.

I don't think she's crossed over yet, but I hear she's not in very good shape and, like capital in Forrest's portfolio, not long for this world.

(No worries... neither does he.)

C'mon, Janice. It's CMKM Diamonds. Who could they possibly get that was unbiased and hadn't misstated their work experience?

Henry Blodget? Tammy Faye Bakker? Charles Manson? Mark Faulk?

Oh. They got Faulk? ...never mind.

What exactly do you think you might see?

Yes, very weak indeed. Trimbath is not going to create any value whatsoever for the poor CMKM Diamonds. There is only one place to look for the legitimate shareholders of CMKM Diamonds: with their stock transfer ledger. Anything else is a run-around. Trimbath is just going to end up wasting you people more time and, perhaps, some money.

I'd say the inclusion of Trimbath in this fiasco is your sign that West isn't committed to anything besides extending the run-around.

That syrupy stuff will rot your teeth, don't ya know?

(The hosebag from the CFRN shows on CMKM Diamonds.)

Then why do you continue to talk nonsense of a potential naked short selling settlement?

You got a secret little thing for Debi Kiontke or something?

I wonder if he pre-ordered the Faulking Idiot's tribute to the fleecing of 40,000 gulliblers.

NO WAY!!!

Is it true, Forrest? Did you catch both legs of Fizzle's little game of "Fleece the Bagholders"?

And yet you still got caught up in the CMKM Diamonds scam.

All that time in the markets, you'd think you'd learn a thing or two.

It's not Fizzle's job to do anything in such a case. In the event there's ever a distribution to the shareholders, those people who didn't receive their certs will have actionable cause against their broker's. (Most of them have signed mandatory arbitration clauses, so it'd be handled in that venue.)

And even if someone could prove that there were parties who were lucky enough to have naked shorted CMKM Diamonds, it wouldn't matter.

It was the right trade; they win.

Perhaps not. I know a guy whose wife is allergic to beer.

Talk about a lucky dude.

Sorry, my mistake. I did think he was in the U.S. I have no idea what they do in Canada... besides drink beer, watch hockey, and listen to old Alanis Morrissette tunes.

I don't believe it's possible to do a partial ACAT (Automated Customer Account Transfer), however, there are partial non-ACAT transfers that some b/d's will let customers do. They tend to take longer to complete than an ACAT, and if it's just the sludge you're looking to move, I don't know that you'd find anyone who would accept the account.

On the other hand, it might not hurt to threaten them (TDW) with the xfer of your account to another firm. If it's a decent sized account, they might get a supervisor involved who knows what they're doing.

I have found that a lot of the back office personnel at TD Waterhouse are incredibly obtuse. I'm sure that didn't improve when they merged with Ameritrade.

Depending upon how large of a loss you're looking to write off, you might want to ACAT your account to a b/d with more astute back officer personnel. optionsXpress is not a bad outfit, at least in my experience. They would probably handle your situation properly.

I wouldn't say L D'V was untalented either, but he should've spent some time state-side before he started painting:

http://www.hahapages.com/pics/monalisa.jpg

And then there was the dyslexic agnostic with insomnia who stayed up nights wondering if there really is a dog...

I couldn't help but think of Keanu Reeve's solution to the hostage situation in the movie "Speed".

"Shoot the hostage."

You're not goin to believe this, Janice, but he actually READ one of their SEC filings.

Get your ice skates, Hitler and Stalin. Hell has frozen over.

"nufced" says she's approached him, but so far at least he doesn't seem to be interested.

More on those two clowns:

http://www.sec.gov/litigation/litreleases/lr18121.htm

The NYSE is an SRO, puppy.

And the driving factor behind the SEC's participation was Ethan Weitz and Robert Altman front-running the sales of stock of 15 different companies.

Front-running sales of any kind, whether you're liquidating a long position, establishing a "regular" short position, or naked shorting is going to get you a tap on the head from the SEC.

There is no law against naked short selling. There are SRO's that place restrictions upon it, but that's not the same thing as being illegal.

I have just seen too many people who've fallen prey to these scammers who've brainwashed a large group of people into believing that naked short selling is evil. So when I see someone repeating their flawed logic, it usually catches my attention.

You caught my attention with your statement, "I dislike illegal NSS as much as I dislike scam artist like UC and his friends/family - they both are death to the market."

I just wondered how it is that you feel NSS could be a "death to the market".

I just find it curious that someone who seems to understand what really took place with CMKM Diamonds would continue to cling to tidbits of the "naked short seller" scam.

Plenty of people borrow shares to sell short with the intent to never cover. The best short sales, even the ones where you go through the trouble of borrowing the shares first, are the ones where the company disappears and you never have to cover. Why does it come to offend you in with a naked position?

There are many practices that can be used as a tool for illegal market manipulation. That doesn't make the practice itself illegal. The leverage afforded you by a margin account or with listed options, if available, can be used as tools for illegal market manipulation. I have no problem with people buying stocks with leverage or loading up on call options if they think a stock is going to go up.

I DO have a problem with them doing it while in the possession of material, non-public information. And when you look at those enforcement actions that have been undertaken against naked short selling, what draws the enforcement action is short sellers who trade on inside information or who have violated agreements (as in the PIPE trade) with the issuers themselves.

Are you somehow under the mistaken impression that naked short selling can harm a company?

"I dislike illegal NSS as much as I dislike scam artist like UC and his friends/family - they both are death to the market"



Is that so?

How is naked short selling a "death to the market"?

What did you do? Besides trash your portfolios?

It is permissible to draw an adverse inference from a party's invocation of the Fifth Amendment in a non-criminal proceeding.

(SEC v. Colello, 1998)

And maybe he was. I never met the guy and I have seen plenty of people make plausible arguments that he was a pawn for someone else.

I can't help but come back to his trust account. How could someone who so thoroughly executed the CMKM Diamonds scam then take the assets he's looted and put them into another disaster stock? (The Mobile Wireless Security one.) It would be like a crook who had made a pile of money running a chain mail scam replying to one of those 419ers from Nigeria and then sending them money.

Defeat?

You don't see me holding delisted shares in a company whose management has looted the company's coffers, leaving them with less than $600 and restricted shares in what will turn out to be yet another pinksheet disaster.

If anything, CMKM Diamonds may be the best example so far (and there have been plenty of others) that demonstrates how the "naked short seller" scam works. Management and promoters distract investors from fundamentals, accuse "naked short sellers" of artificially depressing the stock price, squander the company's working capital, and then leave shareholders with a worthless shell.

CMKM Diamonds' case was executed to perfection.