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Seven That is the whole problem in a nut shell, Uncle Sam is not issuing those notes they are issued by the Federal Reserve a private company, and for every note they print, they loan to our dear uncle Sam they receive nine in return.
We need Uncle to get back on the gold backed buck printed by the treasury as legal tender not federal reserve notes.imo.
" Do you think that trading one promisary note issued by Lumb for another issued by Uncle Sam is safe and smart on our part?"
op9, I don't have PM capabilities, to answer your question it was dismissed without prejudice there will be an appeal filed prior to Jan 6 if needed, however it now appears that it won't be needed, positive action will be before the end of the year. many are saying pay day!
That may be true, however it would take the SEC to request higher action, After all the DTCC is a private company there has got to be some over site somewhere. IMO
Mastaflash, This all starts with us, buying shares with cash and allowing the brokers to electronically generate IOU's in our accounts, and put the shares in their street name, that is a great beginning for the so called stock borrowing program.
I also think there is a humongous short in BCIT, as when we last traded we were @ .15, then dropped to .05 now to 0, during a period that we weren't trading, how was that done?
However can you imagine the gain of those that sold short or sold without borrowing (NSS) at .15.
The DTCC is up to their eye balls in this short IMO and there is no way they will ever allow trading without the government forcing them, and with the SEC also turning a blind eye, that is very un likely.
To add to the mix, most of these shorter's are off shore hedge funds, that pay no taxes to the US Government. How do you fight all that?
To add I think the DTCC was very fortunate that Pino slipped those bogus shares in that gave them the excuse they needed to freeze our stock IMO
All I can say ,is take advantage of the opportunity when it presents itself.
Good luck to all and Merry Christmas, see you next year.
Excellent post Jeanette, thank you for your time and effort here, and a very Marry Christmas to you and your family
Bud Burrell latest
« Thread Started Today at 12:49am »
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After reading this, I cannot help get a sense given the power the criminals have, shown in Bud's latest blog, that we somehow squeezed them because the system that is supposed to protect us from the criminals, is them.
http://www.thesanitycheck.com/Blogs/BudB....d-Shorting.aspx
Insider Trading Indictments Miss Biggest Insider Abuse of All, Naked Shorting.
Nov
30 Written by: bburrell
11/30/2010 9:57 PM
Insider Trading Indictments Miss Biggest Insider Abuse of All, Naked Shorting.
From “Front and Center”, by Bud Burrell
As we have watched the indictments, subpoenas and arrests surrounding illegal insider trading, we have noted one glaring hole not yet addressed, and it is that of the largest insider trading abuse of all, illegal and naked short selling. When the Bermuda Short Sting cases unwound, a total of 88 people were convicted of manipulation, the biggest case of its type until now. The Anthony Elgindy case involved vicious manipulations of over 2200 companies attacked, with billions of dollars in market capitalizations destroyed, and millions of shareholders wiped out, yet there were only a small handful of indictments and convictions. Many super-ceding indictments were promised, but never materialized. The now legendary Eagletech Communications case produced the conviction of 17 organized crime family leaders and soldiers, and again, many more indictments were promised but never materialized.
These broken promises were capitalized on by major defense firms representing the criminal perpetrators, who used them to hammer Federal and State Courts into submission, resulting in some of the most biased and prejudicial rulings ever seen in US Courts. The SEC and FINRA (formerly the NASD) sided with the criminals time after time, changing the rules on an almost continuing basis to protect the worst of the manipulators, including the Hedge Funds generally, their broker-dealers specifically, and ultimately themselves for being held accountable for not doing their jobs.
The laws written in the 1930’s to protect investors from predatory short sales manipulations were the direct outcome of the monstrous wave of actual counterfeiting of physical securities that were sold to an unsuspecting public
"Be sure to read this part"
.................... In the 1970’s, along came the Depository Trust Corporation, whose five year mission was to insure efficient settlement of trades. When the DTC bought the NSCC (National Stock Clearing Corp), they were presented with a magnetic opportunity to explode their profits.
First, they had to change the character of their holdings on behalf of brokers, from physical custody to a form of virtual custody created by dematerialization. Next, they took over the NSCC’s Stock Borrow program. Then, gradually over about 10 years, they made stock certificates unavailable to their owners, taking nominal ownership in exchange for their providing efficient clearing and settlement services. This also allowed them to egregiously abuse the Stock Borrow programs now under their control to support short sellers, which in their process made stock shares become nothing more than equity entitlements, and no kind of actual claim on ownership. In essence and in fact, they had created a mechanism for the virtual counterfeiting of proofs of equity ownership........
The Corporate Stock Record Book became meaningless, since the number of shares in the market regularly exceed by a wide range the actual number of shares legally authorized and issued by the Corporation and incorporated into its SEC reports.
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While thousands objected, the SEC told them to pound sand, and as with the Madoff and Stanford Ponzi schemes, they refused to listen to the victims of these complex crimes even when confronted with overwhelming evidence of theft and conversion. Ponzi schemes were no stranger to the US Government, certainly not after ruining the Social Security Scheme, and after decades of destruction of US currency by misbegotten Federal Reserve’s schemes that have decimated the value of the dollar. This decimation follows what has been done to all fiat currencies since the beginning of socialist concepts of the Progressive movement.
We now face challenges related to the almost certain implosion of not only our Federal Government and its insane debt loads including unfunded liabilities, but also by comparable or even more excessive arrogance and stupidity by our State and Local Governments following the Federal example. I see nothing short of outright Global War to be any solution to this, and I perceive the same amorality in our leadership that would permit such an abomination. Many hoped that the mid-term elections would send Washington a message that the US citizenry would no longer tolerate the lies, frauds, counterfeiting and worse that have been the real “Earmarks” of Progressive Liberal Government.
Socialism has failed everywhere it has been tried, and now we see the pending destruction of not only Europe, but of North America as well. We have gone past the debt tipping point, to a level where only focused political will supported by the US voters would change anything. I don’t see that will, and I have challenged many to show me evidence of its existence. The response today was a vote by the Senate to preserve earmarks as a special privilege. This shocked many, but it also showed that nothing has changed in our Capitol.
We are headed into a economic abyss that will make the Great Depression look like a Sunday lunch in the Park. We have no one to blame but ourselves. Not everyone will act like fat, stupid sheep. That should concern our sell-outs personally. I would not want their future. What they will experience must make the “Shunning” of the Amish look like a jeopardy question. They will be talking, and not only will no one be listening, they will be throwing rotten vegetables at these elitists. It is better than they deserve.
©2010 Bud Burrell
Know the enemy Is the DTCC too big to fail?http://www.zerohedge.com/article/otc-derivatives-dtcc-too-big-fail
OTC Derivatives: Is the DTCC Too Big To Fail?
Submitted by rc whalen on 02/09/2010 08:06 -0500
"In order to streamline securities settlement, Congress ordered that shares traded on exchanges be immobilized, which obviates both physical delivery of certificates and registration of transfer because the shares usually remain registered in the name of a depository or its nominee. This process creates a discrepancy between ownership of the share (economic or beneficial ownership) and the legal status as shareholder (registered stockholder). The more of a market's securities that are registered in the name of a central depository, the greater the number of transactions that can be carried out on its books. The ultimate goal in this model is for all issuers to cede control over all shareholder data to a single entity, which would then conduct all of the market's transactions on its books, just as if all securities in circulation on the market had been dematerialized. Today, in fact, it is likely that a listed company will have only one registered shareholder, appropriately named "Cede & Company", the nominee of the Depository Trust Company (DTC), which is a subsidiary of the Depository Trust and Clearing Company (DTCC), the entity whose group clears and settles almost all securities transactions entered into on organized markets in the United States. The rules of DTC require that Cede be registered as holder for all deposited securities."
"The Rise and Effects of the Indirect Holding System: How Corporate America Ceded its Shareholders to Intermediaries"
Theodor Baums
Andreas Cahn
Working Paper No.68
Institute for Law and Finance
Frankfurt, Germany
09/2007
At our firm we frequently receive calls from clients and readers asking about the likelihood of the passage by the Congress in Washington of reform legislation regarding over-the-counter (OTC) derivatives, financial regulation and/or mortgage securitization. Our answer is small to none given the political trends and the state of the lobbies in Washington, most specifically the large bank lobby that protects the Sell Side monopoly in OTC derivatives and securities. The fact that Senator Richard Shelby (R-AL) is still apparently not comfortable with the entirely watered down House proposal to reform OTC derivatives, for example, tells you all you need to know. Stick a fork in it.
Regarding OTC derivatives, for example, the proposed reforms already are so feeble and ineffectual that whether they pass the Congress or not hardly matters. Financial services reform, you see, is less important that innovation in today's global marketplace, innovations such as centralized clearing for OTC derivatives and quantitative easing for fixing the related problem of widespread global insolvency. And the pace of innovation in the world of OTC markets is accelerating with or without the consent of the Congress thanks to the hard work of the economists who populate the Federal Reserve Board's division of supervision and regulation.
The latest signs of "innovation" on Wall Street can be seen in the announcement last week by the Fed Board of Governors approving the application by something called The Warehouse Trust Company LLC to become a Fed member bank. Warehouse Trust proposes to operate a central trade registry for credit default swap (CDS) contracts and to offer related services, including the processing of lifecycle events for the contracts and facilitation of payments settlement. The membership status becomes effective when Warehouse Trust purchases shares in the Federal Reserve Bank of New York.
Warehouse Trust is a wholly owned subsidiary of DTCC Deriv/SERV LLC (Deriv/SERV), which in turn is a wholly owned subsidiary of The Depository Trust & Clearing Corporation (DTCC). When it opens for business, Deriv/SERV's Trade Information Warehouse (TIW), which currently matches 95% of all CDS trades, will be transferred to Warehouse Trust.
DTCC, in case you are not familiar, clears most of the cash securities volume in the free world. DTC is a limited-purpose trust company organized under the New York banking law, and is a member of the Federal Reserve System. It is owned by the banks that it serves. DTC, and Fixed Income Clearing Corporation and National Securities Clearing Corporation are registered as clearing agencies with the Securities and Exchange Commission. Got it?
The creation of Warehouse Trust as a Fed member bank marks the latest attempt by the large dealer banks and the DTCC to cover the retrograde OTC derivatives market in the clothes of modern respectability. The solution to all things bad in the world of OTC derivatives, you see, is centralized clearing. DTCC has lent its considerable credibility to the large bank cause because, after all, its clients are large banks. Indeed, if you listen to the folks at the Fed, the DTCC and the large OTC dealer banks, the advent of centralized clearing is just barely less momentous than the second coming of the Messiah.
One of the benefits of spending a lot of time talking and writing about centralized clearing as the solution to all known troubles and woes in the world of OTC derivatives and especially in CDS contracts is that it keeps the attention of the Big Media, the Congress and the regulators away from the front office and the process of creating and selling complex structured securities and derivatives. It is in the front office where the true problems reside, but notice that none of the OTC reform proposals nor the Volcker Rule go anywhere near the sales and trading desks at the large banks.
Based on our study of the Volcker Rule, which proposes to strip all of the largest banks of their proprietary trading arms, we know that solving the problem is not the real object of financial reform in Washington. Just as the Volcker Rule does no violence to the sales and syndicate function of the largest Sell Side banks, the proposed OTC derivatives reform legislation leaves the dealer monopoly in OTC intact and just barely improves the degree of regulatory oversight of these closed, private markets.
In technology terms, fixing the back office issues of OTC derivatives or securitizations with innovations like Warehouse Trust is akin to announcing a new venture to build cars with internal combustion engines. The evolution of DTCC into the de facto back office of an equally de facto market known as OTC is nothing more than recreating the wheel of multilateral exchanges and joint and several liability of clearing members, albeit one inch at a time.
The advantage of slow motion innovation is that the large dealer banks get to extend the date of true reform of OTC markets by years and pretend to be dealing with the systemic issues created by these unregulated, deliberately opaque OTC instruments, all the while harvesting supra-normal returns from these high-risk, high margin activities. Consider that all of the activities now conducted by TIW and that will be assumed by Warehouse Trust are considered routine at any of the multilateral exchanges, but at the Fed and among the large dealer banks, this is called innovation.
The sad fact is that a great deal of the "reforms" imposed on the OTC markets over the past several years have done nothing to improve price transparency or lessen the monopoly market power of the OTC dealers. To the contrary, under Tim Geithner, first at the Fed of New York and now the Treasury, the thrust of US policy has been to protect and enhance the monopoly position of the OTC dealers, all the while limiting "novation" or assignment of contracts (and thus secondary market trading) and price discovery.
None of the technical issues that drove the Geithner OTC reforms are even issues on a multilateral exchange. Indeed, since the Fed of New York began to focus attention on the back office issues surrounding OTC markets, the dealer grip on the OTC markets has arguably gotten tighter. When a customer faces a dealer instead of an open outcry market, the situation is unfair by definition and goes against basic American practice and experience, and the law, when it comes to the organization of financial markets.
To us, the whole object of the strategy pursued by the OTC dealers and abetted by the DTCC is to adopt enough of the operational attributes of a multilateral exchange to blunt criticisms of the OTC markets with respect to systemic risk issues, but leave in place the dealer monopoly and odious front office sales practices, the rape and pillage mentality that thrives today among Sell Side firms operating in the CDS markets. Just read the Sunday New York Times article by Louise Story and Gretchen Morgenson, "Testy Conflict With Goldman Helped Push A.I.G. to Edge," to understand the relationship between American International Group (AIG) and its OTC dealer bank counterparties.
The aspects of the OTC markets which remain off the reform table includes the bilateral relationship between the client and dealer regarding credit and collateral, the lack of complete market price transparency and the lack of any significant secondary market trading, all to maintain the monopoly rents that the large OTC dealers earn from this activity. Today's OTC markets have all of the attributes of a 1920s bucket shop and now the hub of this closed monopoly market is the DTCC, especially as the clearing house evolves inevitably into a central counterparty for all OTC trades.
And now the DTCC, through OTC derivatives market evolutions such as the creation of Warehouse Trust, is become the single point of failure in the world's financial system by virtue of its role in the OTC derivatives market. Both DTCC and Warehouse Trust are Fed member banks, but the former is not considered a bank holding company because neither entity takes deposits and are thus not FDIC members.
However, in the approval order by the Fed, DTCC commits to submit to Warehouse Trust to Fed prudential supervision as though it were an FDIC insured bank. What a shame that the Fed did not instead require DTCC and Warehouse Trust to be FDIC members and thus subject them to the discipline of the joint and several liability of being federally insured depositories. That would put the entire banking industry on notice that they are on the hook for the OTC shell game rising atop the infrastructure of the DTCC. Duh!
The Fed does, after all, does have a legal responsibility to ensure the sound operation of member banks regardless of their status as deposit takers. The order states that "Warehouse Trust will be well capitalized at the time it commences operations, and it will maintain capital that is sufficient to allow for an orderly wind-down if confronted with the need to cease operations." This is what economists call a "living will" by the way. The only trouble with the Fed's thinking is that if Warehouse Trust ever had to be unwound, then the DTCC itself probably would be in trouble as well.
Since the Fed has allowed the Warehouse Trust application to be approved without imposing the de facto cross-guarantee of FDIC membership on DTCC and all of its affiliates, it seems reasonable to ask just how the Fed would unwind this new member bank without destroying the entire western financial system. More important, why has the Fed put the entity that clears every cash equity and bond trade in the civilized world at risk to also be the central nexus and perhaps eventually even the counterparty for all OTC derivatives?
As the DTCC evolves from a record-keeper today and into a central counterparty for OTC derivatives and particularly CDS in the future, the question seems to be begged: Is the Warehouse Trust and DTCC now "too big to fail?" In the DTCC and Warehouse Trust, have we arrived at the functional equivalent of a multilateral exchange, via unauthorized public bailouts and the monetization of debt by our independent central bank, but in a decidedly sloppy and haphazard fashion?
Or as one former Treasury official told The IRA: "You can't reiterate enough the point that DTCC is owned by the dealer firms and thus the NY Fed is actively and purposefully aiding and abetting the continued OTC monopoly at the expense of real reform."
We'll be talking about this further and look forward to your comments.
Questions? Comments? info@institutionalriskanalytics.com
neil I agree with most of what you say, however I do not think that any established price could go under the promised .0034, due to the price of gold increase post our sale deal, that is insurance that we will get the .0034.
I do not however expect anything above that figure, unless we hold for the 3% additional as dividends.
Just to add to my post, The system is not set up to report Buys or Sells, it only looks at Bid or Ask, and all activity on the Bid is considered as a sell and all activity on the Ask is a buy to the reporting system.
So "if" the company is in the process of a buy back and must buy at the bid, it will be reported as a sell that is why I said it was "indicative" of a company buy back
dblue, Being fully reporting is not a criteria on company buying back shares, the buy back rule applies to all,including Pinksheet/Greysheets or the fully reporting OTCBB.
This could be indicative of the company buying back shares, as they are required by the SEC to buy at the bid. The purpose being, so that company buy back does not inflate the PPS.
This makes Pino look like mother Teresa in comparison.DTCC up to their ears in Fraud.
From another board
http://www.counterfeitingstock.com/CounterfeitingStock.html
Who are the Participants in the Fraud? The participants subscribe to the theory that it is much easier to make money tearing companies down than making money building them up, and they fall into two general categories: 1) They participate in the process of producing the counterfeit shares that are the currency of the fraud and/or 2) they actively short and tear companies down.
The counterfeiting of shares is done by participating prime brokers or the DTC, which is owned by the prime brokers. A number of lawsuits that involve naked shorting have named about ten of the prime brokers as defendants, including Goldman Sachs, Bear Stearns, Citigroup, Merrill Lynch; UBS; Morgan Stanley and others. The DTCC has also been named in a number of lawsuits that allege stock counterfeiting.
The identity of the shorts is somewhat elusive as the shorts obscure their true identity by hiding behind the prime brokers and/or hiding behind layers of offshore domiciled shell corporations. Frequently the money is laundered through banks in a number of tax haven countries before it finally reaches its ultimate beneficiary in New York, New Jersey, San Francisco, etc. Some of the hedge fund managers who are notorious shorters, such as David Rocker and Marc Cohodes, are very public about their shorting, although they frequently utilize offshore holding companies to avoid taxes and scrutiny.
Most of the prime brokers have multiple offshore subsidiaries or captive companies that actively participate in shorting. The prime brokers also front the shorting of some pretty notorious investors. According to court documents or sworn testimony, if one follows one of the short money trails at Solomon, Smith Barney, it leads to an account owned by the Gambino crime family in New York. A similar exercise with other prime brokers, who cannot be named at this time, leads to the Russian mafia, the Cali drug cartel, other New York crime families and the Hell's Angels.
One short hedge fund that was particularly destructive was a shell company domiciled in Bermuda. Subpoenas revealed the Bermuda company was wholly owned by another shell company that was domiciled in another tax haven country. This process was five layers deep, and at the end of the subterfuge was a very well known American insurance company that cannot be disclosed because of court–ordered sealing of testimony.
Most of the large securities firms, insurance companies and multi–national companies have layers of offshore captives that avoid taxes, engage in activities that the company would not want to be publicly associated with, like stock manipulation; avoid U.S. regulatory and legal scrutiny; and become the closet for deals gone sour, like Enron.
The Creation of Counterfeit Shares — There are a variety of names that the securities industry has dreamed up that are euphemisms for counterfeit shares. Don't be fooled : Unless the short seller has actually borrowed a real share from the account of a long investor, the short sale is counterfeit. It doesn't matter what you call it and it may become non–counterfeit if a share is later borrowed, but until then, there are more shares in the system than the company has sold.
The magnitude of the counterfeiting is hundreds of millions of shares every day, and it may be in the billions. The real answer is locked within the prime brokers and the DTC. Incidentally, counterfeiting of securities is as illegal as counterfeiting currency, but because it is all done electronically, has other identifiers and industry rules and practices, i.e. naked shorts, fails–to–deliver, SHO exempt, etc. the industry and the regulators pretend it isn't counterfeiting. Also, because of the regulations that govern the securities, certain counterfeiting falls within the letter of the rules. The rules, by design, are fraught with loopholes and decidedly short on allowing companies and investors access to information about manipulations of their stock.
The creation of counterfeit shares falls into three general categories. Each category has a plethora of devices that are used to create counterfeit shares.
1. Fails–to–Deliver — If a short seller cannot borrow a share and deliver that share to the person who purchased the (short) share within the three days allowed for settlement of the trade, it becomes a fail–to–deliver and hence a counterfeit share; however the share is transacted by the exchanges and the DTC as if it were real. Regulation SHO, implemented in January 2005 by the SEC, was supposed to end wholesale fails–to–deliver, but all it really did was cause the industry to exploit other loopholes, of which there are plenty (see 2 and 3 below).
Since forced buy–ins rarely occur, the other consequences of having a fail–to–deliver are inconsequential, so it is frequently ignored. Enough fails–to–deliver in a given stock will get that stock on the SHO list, (the SEC's list of stocks that have excessive fails–to–deliver) – which should (but rarely does) see increased enforcement. Penalties amount to a slap on the wrist, so large fails–to–deliver positions for victim companies have remained for months and years.
A major loophole that was intentionally left in Reg SHO was the grandfathering in of all pre–SHO naked shorting. This rule is akin to telling bank robbers, “If you make it to the front door of the bank before the cops arrive, the theft is okay.”
Only the DTC knows for certain how many short shares are perpetual fails–to–deliver, but it is most likely in the billions. In 1998, REFCO, a large short hedge fund, filed bankruptcy and was unable to meet margin calls on their naked short shares. Under this scenario, the broker dealers are the next line of financial responsibility. The number of shares that allegedly should have been bought in was 400,000,000, but that probably never happened. The DTC — owned by the broker dealers — just buried 400,000,000 counterfeit shares in their system, where they allegedly remain — grandfathered into “legitimacy” by the SEC. Because they are grandfathered into “legitimacy”, the SEC, DTC and prime brokers pretend they are no longer fails–to–deliver, even though the victim companies have permanently suffered a 400 million share dilution in their stock.
Three months prior to SHO, the aggregate fails–to–deliver on the NASDAQ and the NYSE averaged about 150 million shares a day. Three months after SHO it dropped by about 20 million, as counterfeit shares found new hiding places (see 2 and 3 below). It is noteworthy that aggregate fails–to–deliver are the only indices of counterfeit shares that the DTC and the prime brokers report to the SEC. The bulk of the counterfeiting remains undisclosed, so don't be deceived when the SEC and the industry minimize the fails–to–deliver information. It is akin to the lookout on the Titanic reporting an ice cube ahead.
2. Ex–clearing counterfeiting — The second tier of counterfeiting occurs at the broker dealer level. This is called ex–clearing. Multiple tricks are utilized for the purpose of disguising naked shorts that are fails–to–deliver as disclosed shorts, which means that a share has been borrowed. They also make naked shorts “invisible” to the system so they don't become fails–to–deliver, which is the only thing the SEC tracks.
Some of the tricks are as follows:
* Stock sales are either a long sale or a short sale. When a stock is transacted the broker checks the appropriate box. By mismarking the trading ticket –checking the long box when it is actually a short sale the short never shows up, unless they get caught, which doesn't happen often. The position usually gets reconciled when the short covers.
* Settlement of stock transactions is supposed to occur within three days, at which time a naked short should become a fail–to–deliver, however the SEC routinely and automatically grants a number of extensions before the naked short gets reported as a fail–to–deliver. Most of the short hedge funds and broker dealers have multiple entities, many offshore, so they sell large naked short positions from entity to entity. Position rolls, as they are called, are frequently done broker to broker, or hedge fund to hedge fund, in block trades that never appear on an exchange. Each movement resets the time clock for the naked position becoming a fail–to–deliver and is a means of quickly getting a company off of the SHO threshold list.
* The prime brokers may do a buy–in of a naked short position. If they tell the short hedge fund that we are going to buy–in at 3:59 EST on Friday, the hedge fund naked shorts into their own buy–in (or has a co–conspirator do it) and rolls their position, hence circumventing Reg SHO.
* Most of the large broker dealers operate internationally, so when regulators come in (they almost always “call ahead”) or compliance people come in (ditto), large naked positions are moved out of the country and returned at a later date.
* The stock lend is enormously profitable for the broker dealers who charge the short sellers large fees for the “borrowed” shares, whether they are real or counterfeit. When shares are loaned to a short, they are supposed to remain with the short until he covers his position by purchasing real shares. The broker dealers do one–day lends, which enables the short to identify to the SEC the account that shares were borrowed from. As soon as the report is sent in, the shares are returned to the broker dealer to be loaned to the next short. This allows eight to ten shorts to borrow the same shares, resetting the SHO–fail–to–deliver clock each time, which makes all of the counterfeit shares look like legitimate shares. The broker dealers charge each short for the stock lend.
* Margin account buyers, because of loopholes in the rules, inadvertently aid the shorts. If short A sells a naked short he has three days to deliver a borrowed share. If the counterfeit share is purchased in a margin account, it is immediately put into the stock lend and, for a fee, is available as a borrowed share to the short who counterfeited it in the first place. This process is perpetually fluid with multiple parties, but it serves to create more counterfeit shares and is an example of how a counterfeit share gets “laundered” into a legitimate borrowed share.
* Margin account agreements give the broker dealers the right to lend those shares without notifying the account owner. Shares held in cash accounts, IRA accounts and any restricted shares are not supposed to be loaned without express consent from the account owner. Broker dealers have been known to change cash accounts to margin accounts without telling the owner, take shares from IRA accounts, take shares from cash accounts and lend restricted shares. One of the prime brokers recently took a million shares from cash accounts of the company's founding investors without telling the owners or the stockbroker who represented ownership. The shares were put into the stock lend, which got the company off the SHO threshold list, and opened the door for more manipulative shorting.
This is a sample of tactics used. For a company that is under attack, the counterfeit shares that exist at this ex–clearing tier can be ten or twenty times the number of fails–to–deliver, which is the only category tracked and policed by the SEC.
3. Continuous Net Settlement — The third tier of counterfeiting occurs at the DTC level. The Depository Trust and Clearing Corporation (DTCC) is a holding company owned by the major broker dealers, and has four subsidiaries. The subsidiaries that are of interest are the Depository Trust Company (DTC) and the National Securities Clearing Corporation (NSCC). The DTC has an account for each broker dealer, which is further broken down to each customer of that broker dealer. These accounts are electronic entries. Ninety seven percent of the actual stock certificates are in the vault at the DTC with the DTC nominee's name on them. The NSCC processes transactions, provides the broker dealers with a central clearing source, and operates the stock borrow program.
When a broker dealer processes the sale of a short share, the broker dealer has three days to deliver a borrowed share to the purchaser and the purchaser has three days to deliver the money. In the old days, if the buyer did not receive his shares by settlement day, three days after the trade, he took his money back and undid the transaction. When the stock borrow program and electronic transfers were put in place in 1981, this all changed. At that point the NSCC guaranteed the performance of the buyers and sellers and would settle the transaction even though the seller was now a fail–to–deliver on the shares he sold. The buyer has a counterfeit share in his account, but the NSCC transacts it as if it were real.
At the end of each day, if a broker dealer has sold more shares of a given stock than he has in his account with the DTC, he borrows shares from the NSCC, who borrows them from the broker dealers who have a surplus of shares. So far it sounds like the whole system is in balance, and for any given stock the net number of shares in the DTC is equal to the number of shares issued by the company.
The short seller who has sold naked – he had no borrowed shares – can cure his fail–to–deliver position and avoid the required forced buy–in by borrowing the share through the NSCC stock borrow program.
Here is the hocus pocus that creates millions of counterfeit shares.
When a broker dealer has a net surplus of shares of any given company in his account with the DTC, only the net amount is deducted from his surplus position and put in the stock borrow program. However the broker dealer does not take a like number of shares from his customer's individual accounts. The net surplus position is loaned to a second broker dealer to cover his net deficit position.
Let's say a customer at the second broker dealer purchased shares from a naked short seller — counterfeit shares. His broker dealer “delivers” those shares to his account from the shares borrowed from the DTC. The lending broker dealer did not take the shares from any specific customers' account, but the borrowing broker dealer put the borrowed shares in specific customer's accounts. Now the customer at the second prime broker has “real” shares in his account. The problem is it's the same “real” shares that are in the customer's account at the first prime broker.
The customer account at the second prime broker now has a “real” share, which the prime broker can lend to a short who makes a short sale and delivers that share to a third party. Now there are three investors with the same counterfeit shares in their accounts.
Because the DTC stock borrow program, and the debits and credits that go back and forth between the broker dealers, only deals with the net difference, it never gets reconciled to the actual number of shares issued by the company. As long as the broker dealers don't repay the total stock borrowed and only settle their net differences, they can “grow” a company's issued stock.
This process is called Continuous Net Settlement (CNS) and it hides billions of counterfeit shares that never make it to the Reg. SHO radar screen, as the shares “borrowed” from the DTC are treated as a legitimate borrowed shares.
For companies that are under attack, the counterfeit shares that are created by the CNS program are thought to be ten or twenty times the disclosed fails–to–deliver, and the true CNS totals are only obtained by successfully serving the DTC with a subpoena. The SEC doesn't even get this information. The actual process is more complex and arcane than this, but the end result is accurately depicted.
Ex–clearing and CNS counterfeiting are used to create an enormous reserve of counterfeit shares. The industry refers to these as “strategic fails–to–deliver.” Most people would refer to these as a stockpile of counterfeit shares that can be used for market manipulation. One emerging company for which we have been able to get or make reasonable estimates of the total short interest, the disclosed short interest, the available stock lend and the fails–to–deliver, has fifty “buried” counterfeit shares for every fail–to–deliver share, which is the only thing that the SEC tracks, consequently the SEC has not acted on shareholder complaints that the stock is being manipulated.
Hey Rocket, Doing fine thanks, just sitting back waiting for all this "stuff" to come to fruition, hope you are doing well.
just a thought for the mods, Maybe we could pin the PR's or at least the last one until a new one will up date. thanks.
Dakshidin Welcomes Industry Veteran to Board of Directors
Nov 29, 2010 09:15:36 (ET)
LAS VEGAS, NV, Nov 29, 2010 (MARKETWIRE via COMTEX) -- Dakshidin Corporation (pinksheets:DKSC) is extremely pleased to announce the appointment of P. Thomas (Tom) Cox, PhD. to its board of directors. Dr. Cox is a highly regarded renewable energy expert whose career with numerous organizations and agencies spans more than fifty years with an emphasis on the developing world. During his illustrious career Dr. Cox has been responsible for the oversight of a number of multi-billion dollar projects and has had more than 120 articles published attesting to his expertise in the field.
"I am thrilled that Dr. Cox has joined our board of directors. Having an individual with Tom's expertise and reputation is a definite advantage for us," stated John Alexander (Lex) van Arem, interim CEO of Dakshidin Corporation. "Tom's project experience and his connections in the developing world will greatly assist us in bringing our business plan to fruition. I look forward to working with Tom beginning immediately."
Dr. Cox's active involvement in the company is expected to greatly enhance Dakshidin Corporation's ability to directly access both ongoing projects worldwide as well as the many organizations and countries he is presently working with. As a result of his numerous contacts he will also be able to assist the company in strategically leveraging existing resources.
"I have spent the better part of my career overseeing projects in the developing world. Clean water and reliable electricity are still very much in demand there," Dr Cox said in a recent interview. "The reputation I have built in over 50 years of work is of prime importance to me. I have joined Dakshidin because I truly believe that it can and will play a major role in providing renewable energy and potable water to parts of the world that need it the most. I am looking forward to using my expertise and numerous contacts to bring the Dakshidin Corporation's plan to completion in as short a time line as possible. The technology that they represent can make a tremendous difference for many millions of people."
In other news, Dakshidin Corporation confirms that it is diligently working with multiple parties and humanitarian organizations to bring the advanced negotiations currently underway to a successful conclusion. Though this process has taken longer than had been anticipated due to the number of different parties involved, definitive results are expected shortly.
Dakshidin Corporation will continue to update shareholders as events progress.
Forward-Looking Statements: The information in this press release includes certain "forward-looking" statements within the meaning of the Safe Harbor provisions of Federal Securities Laws. Investors are cautioned that such statements are based upon assumptions that in the future may prove not to have been accurate and are subject to significant risks and uncertainties, including the future financial performance of the Company. Although the Company believes that the expectations reflected in its forward-looking statements are reasonable, it can give no assurance that such expectations or any of its forward-looking statements will prove to be correct. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date of this release, and the Company undertakes no obligation to update publicly any forward-looking statements to reflect new information, events, or circumstances after the date of this release except as required by law.
Contact:
Dakshidin Corporation
John A. van Arem
1-888-250-6601
SOURCE: Dakshidin Corporation
paunch, It doesn't work that way, SEC did not put HGLC on the Greys per say, the fact that HGLC was halted past the five consecutive days of required trading pinksheets rule, is why they got moved to the grey sheets.
Not the 19k that is the problem, look at the spread between bid and ask, every trade the MM's are getting 5 points, their method of holding a stock from running. If you remember when the stock was in the 002's the spread was only 1 point a 5 point spread is ridiculous for a sub penny stock
turn2him, I do not believe that I need to tell that to Magus, as I think he was well informed by the law suit he filed against us.
It is the DTC that is holding us up, why do you think they are doing that?
I'll tell you, it's because the Depository Trust is holding all the phoney shares in brokers street name, which means that not one of us holding broker IOU's are involved.
No matter how the phoney shares got to the depository, the brokers have issued IOU's to us, and they must maintain their fiduciary responsibility for that action. (action was, they took our money and our shares and deposited in their STREET NAME issuing us a IOU)
And any broker that has deleted IOU's in anyone's account is trying to sheik that responsibility and stealing from investors.
Happy Thanksgiving Vianna, and all the dedicated FFGO holders.
turn2him,Unbelievable, the only fake shareholders (if there are any) are only those holding in cert form, or those that have requested with a $75.00 fee to have shares put in their name.
All others are in STREET NAME and are holding IOU's in their accounts, any fake shares out there, if not held by the for mentioned, are in the brokers name. Period! We hold his electronically generated IOU's not fake shares or any other kind of shares.
Turn2him, I doubt that very much, first of all, we do not have shares in our accounts, we have IOU's, that means that the brokers have taken our money and our shares and put our shares in their street name.
The brokers fiduciary responsibility is to redeem those IOU's upon demand at market value.
We are held in a hiatus and are not trading, that however does not relieve the broker of his responsibility, and to keep our money, as well as remove their IOU's, as long as there is a possibility of trading again.
As long as the company has not declared BK that possibility of trading again remains, which would not give the broker the right to remove the IOU's from anyone's account.
Not to forget, that cash was paid for those IOU's so it matters not, if shares put into street name were counterfeit, it has nothing to do with our dealings with our brokers.
Bloodless, Yes I most certianly would rather get a PR that states what "has been" accomplished than one that states what "will be" accomplished.There is really no big hurry here, progress is evident so let it happen imo.
Wayne I'm not so sure that 100% is etched in stone, with the price of gold increasing as it is, there may be some insiders holding A's and B's that may just want to put a little pressure on.
Lebon23 What would you have them say, that there is a cagillion nss out there in our stock, and we are going to put out a dividend, that there is no way in the world the shorts can cover a X 3,400 increase in value without CASH! Sure they will!!!!!!!!!!!!!!!!lol
Vianna, That is correct, which extrapolates out to .0034 per share held, so regardless where gold goes now, we have already sold our holdings and will see no further increase by the gold value increasing.
However as gold increases I would think that NMGL would be more inclined to commence the rest of the deal for 100%,of Bouse and CS it becomes insurance that we will get the promised .0034.
seventeneleven,Yes, however the hypothecation of our shares and our currency may be coming to an end.
This could be the first step in that direction, in this G-20 meeting.
http://af.reuters.com/article/metalsNews/idAFSGE6A70A720101108
UPDATE 2-World Bank chief surprises with gold standard idea
Mon Nov 8, 2010 11:32am GMT
Print | Single Page
[-] Text [+]
* World Bank chief urges G20 currency cooperation
* Zoellick says gold could be used as reference point
* Gold spikes, then retreats as markets digest surprise call
(changes dateline, previous SINGAPORE, adds background)
LONDON, Nov 8 (Reuters) - Leading economies should consider adopting a modified global gold standard to guide currency rates, World Bank president Robert Zoellick said on Monday in a surprise proposal before a potentially acrimonious G20 summit.
Writing in the Financial Times, Zoellick called for a "Bretton Woods II" system of floating currencies as a successor to the Bretton Woods fixed-exchange rate regime that broke down in the early 1970s.
The former U.S. trade representative, who served in several Republican administrations, said such a move "is likely to need to involve the dollar, the euro, the yen, the pound and (a yuan) that moves towards internationalisation and then an open capital account.
"The system should also consider employing gold as an international reference point of market expectations about inflation, deflation and future currency values," he added. Continued...
Texan, I guess the problem is we have no idea what those possible partners were offered in the negotiations, do we really know they are still our partners.
I personally wouldn't have taken paper for billions of shares under these conditions of being put on the back burner, without some meat on the plate.
AKfish, The company sold their shares of Bouse and Copperstone for a set price, when NMGL issued the negotiated amount of A&B's to Western, a subsidiary of FFGO that was payment in full to us as FFGO.
No further money is due regardless of the price of gold, just like anytime shares are sold, that ends the contract, which was between NMGL and FFGO.
Now FFGO has the A's and B's however can not deliver until the conditions of the sale (Bouse/Copperstone)are met.
So we are now waiting for FFGO to release those shares to us as promised, IAW the sale contract agreement.
That means we are LOCKED in to the promissed amount of .0034, providing the price of gold does not go below $1050 per oz.
Just my opinion but looks to me like the shareholders of FFGO were neatly negotiated out to pasture, along with losing all communication with our company.Sorry to say!
mathias Stay tuned maybe I can provide that info shortly, however you had better read it fast, as I don't believe it will last long on Ihub.
"Some believe?
No, you and maybe two others believe that nonsense.
Can you post one example of a "pay day from shorty?"
Just one? "
PD That is exactly the way I see it, we have been locked out of communication and locked in at .0034, and the only impact the gold price has is to insure the .0034 value. That is providing all other sale conditions are met.
Texan you could be right however I thought that NMGL has already issued the shares to Western (Sub of FFGO,)if so then payment has been made to FFGO and it is now up to them to issue to us.
If that is the case, then the increase of gold has nothing to do with increasing our dividend as it has been locked by that issue by NMGL.
Did we sell our assets too soon? yeah think?
Problem I see, with the increasing Gold price, although it will give NMGL incentive to purchase the remanding shares to reach 100%, however at the same time getting those shares will be a lot tougher as gold increases.
I also think there is a humongous change in our monitory system coming very soon, good buy FED! Hello Treasury. IMO
Rember this post from last week!
"AlanC Keep your eyes on POTUS this week end for an announcement!"
Today on fox news at 6:50 am est they said Obama would put 5 trillion in the economy and announce during his speech.
Gotta wonder where he will get 5trillion $$$$$
I know it's great to get into a large contract, if you can meet all time frame requirements, I just hope they don't bite off more than they can manage, that would end hurting them.
I would just like to see a solid flow of revenues to operate, without any future dilution of shares, and have them follow the promised proposed buy back of shares, as well as becoming a fully reporting company.
Building a good report with clients and following what you promise, in my opinion, is most important at this point.
I think they are finally on the right track, just hope they don't over extend their resources.
Well, I see the MM's have finally lowered the spread from 5 points to 1 point, that 5 point spread was indicative to force slow down buying. The 1 point is indicative of letting the stock be controlled by the buying/selling pressures, that imo is a mile stone.
wrenchman Yes! I know that gold is going to explode, look for an announcement Wed or Thus about gold backed treasury $$$$$$$
AlanC Keep your eyes on POTUS this week end for an announcement!
Looks to me like attorneys looking for work lol.
Looks to me, the MM's are having a field day with that spread.
paunch, Stay tuned, that emergency G-20 meeting this past weekend was for starting of that new ball game. It has been said years ago that countries would aline financially, I believe we are now seeing the opening pitch. imo
Might look to your $$$ losing that Federal reserve note status, replaced by a US Treasury symbol soon!