Zeev's Turnips Talk Politics (ZTTP)

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SEC SECRET PROBE OF STOCK
DEALINGS BEFORE 9/11
http://tbrnews.org/Archives/a048.htm
Between August 26 and September 11, 2001, a group of speculators,
identified by the American Securities and Exchange Commission as
Israeli citizens, sold "short" a list of 38 stocks that could
reasonably be expected to fall in value as a result of the pending
attacks. These speculators operated out of the Toronto, Canada and
Frankfurt, Germany, stock exchanges and their profits were
specifically stated to be "in the millions of dollars."
Short selling of stocks involves the opportunity to gain large
profits by passing shares to a friendly third party, then buying them
back when the price falls. Historically, if this precedes a traumatic
event, it is an indication of foreknowledge. It is widely known that
the CIA uses the Promis software to routinely monitor stock trades as
a possible warning sign of a terrorist attack or suspicious economic
behavior. A week after the Sept.11 attacks, the London Times reported
that the CIA had asked regulators for the Financial Services
Authority in London to investigate the suspicious sales of millions
of shares of stock just prior to the terrorist acts. It was hoped the
business paper trail might lead to the terrorists.
Investigators from numerous government agencies are part of a
clandestine but official effort to resolve the market manipulations
There has been a great deal of talk about insider trading of American
stocks by certain Israeli groups both in Canada and Germany between
August 26 and the Sept.11 attacks on the World Trade Center and the
Pentagon.
Lynne Howard, a spokeswoman for the Chicago Board Options Exchange
(CBOE), stated that information about who made the trades was
available immediately. "We would have been aware of any unusual
activity right away. It would have been triggered by any unusual
volume. There is an automated system called 'blue sheeting,' or the
CBOE Market Surveillance System, that everyone in the business knows
about. It provides information on the trades - the name and even the
Social Security number on an account - and these surveillance systems
are set up specifically to look into insider trading. The system
would look at the volume, and then a real person would take over and
review it, going back in time and looking at other unusual activity."
Howard continued, "The system is so smart that even if there is a
news event that triggers a market event it can go back in time, and
even the parameters can be changed depending on what is being looked
at. It's a very clever system and it is instantaneous. Even with the
system, though, we have very experienced and savvy staff in our
market-regulations area who are always looking for things that might
be unusual. They're trained to put the pieces of the puzzle together.
Even if it's offshore, it might take a little longer, but all
offshore accounts have to go through U.S. member firms - members of
the CBOE - and it is easily and quickly identifiable who made the
trades. The member firm who made the trades has to have identifiable
information about the client under the 'Know Your Customer'
regulations (and we share all information with the Securities and
Exchange Commission.)"
Given all of this, at a minimum the CBOE and government regulators
who are conducting the secret investigations have known for some time
who made the options puts on a total of 38 stocks that might
reasonably be anticipated to have a sharp drop in value because of an
attack similar to the 9/11 episode. The silence from the
investigating camps could mean several things: Either terrorists are
responsible for the puts on the listed stocks or others besides
terrorists had foreknowledge of the attack and used this knowledge to
reap a nice financial harvest from the tragedy.
Adam Hamilton of Zeal LLC, a North Dakota-based private consulting
company that publishes research on markets worldwide, stated that "I
heard that $22 million in profits was made on these put options..."
Federal investigators are continuing to be so closed-mouthed about
these stock trades, and it is clear that a much wider net has been
cast, apparently looking for bigger international fish involved in
dubious financial activity relating to the 9/11 attacks on the world
stock markets.
Just a month after the attacks the SEC sent out a list of stocks to
various securities firms around the world looking for information.
The list includes stocks of American, United, Continental, Northwest,
Southwest and US Airways airlines, as well as Martin, Boeing,
Lockheed Martin Corp., AIG, American Express Corp, American
International Group, AMR Corporation, Axa SA, Bank of America Corp,
Bank of New York Corp, Bank One Corp, Cigna Group, CNA Financial,
Carnival Corp, Chubb Group, John Hancock Financial Services, Hercules
Inc, L-3 Communications Holdings, Inc., LTV Corporation, Marsh &
McLennan Cos. Inc., MetLife, Progressive Corp., General Motors,
Raytheon, W.R. Grace, Royal Caribbean Cruises, Ltd., Lone Star
Technologies, American Express, the Citigroup Inc. ,Royal & Sun
Alliance, Lehman Brothers Holdings, Inc., Vornado Reality Trust,
Morgan Stanley, Dean Witter & Co., XL Capital Ltd., and Bear
Stearns.
The Times said market regulators in Germany, Japan and the US all had
received information concerning the short selling of insurance,
airlines and arms companies stock, all of which fell sharply in the
wake of the attacks.
City of London broker and analyst Richard Crossley noted that someone
sold shares in unusually large quantities beginning three weeks
before the assault on the WTC and Pentagon.
He said he took this as evidence that someone had insider
foreknowledge of the attacks.
"What is more awful than he should aim a stiletto blow at the heart
of Western financial markets?" he added. "But to profit from it?
Words fail me."
The US Government also admitted it was investigating short selling,
which evinced a compellingly strong foreknowledge of the coming Arab
attack.
There was unusually heavy trading in airline and insurance stocks
several days before Sept.11, which essentially bet on a drop in the
worth of the stocks.
It was reported by the Interdisciplinary Center, a counter-terrorism
think tank involving former Israeli intelligence officers, that
insiders made nearly $16 million profit by short-selling shares in
American and United Airlines, the two airlines that suffered
hijacking, and the investment firm of Morgan Stanley, which occupied
22 floors of the WTC.
Apparently none of the suspicious transactions could be traced to bin
Laden because this news item quietly dropped from sight, leaving many
people wondering if it tracked back to American firms or intelligence
agencies.
Most of these transactions were handled primarily by Deutsche
Bank-A.B.Brown, a firm which until 1998 was chaired by A. B."Buzzy"
Krongard, who later became executive director of the CIA.
More serious was an article in the Sept. 28, 2001 edition of the
Washington Post stating that officials with the instant messaging
firm of Odigo in New York confirmed that two employees in Israel
received text messages warning of an attack on the WTC two hours
before the planes crashed into the buildings!
The firm's vice president of sales and marketing, Alex Diamandis said
it was possible that the warning was sent to other Odigo members, but
they had not received any reports of such.
The day after, the Jerusalem Post claimed two Israelis died on the
hijacked airplanes and that 4,000 were missing at the WTC.
A week later, a Beirut television station reported that 4,000 Israeli
employees of the WTC were absent the day of the attack.
This information spread across the Internet but was quickly branded a
hoax.
On Sept. 19, the Washington Post reported about 113 Israelis were
missing at the WTC and the next day, President Bush noted more than
130 Israelis were victims.
Finally, on Sept. 22, the New York Times stated "There were, in fact,
only three Israelis who had been confirmed as dead: two on the planes
and another who had been visiting the towers on business and who was
identified and buried."
Investigators from numerous government agencies are part of a
clandestine but official effort to resolve the market manipulations.
There has been a great deal of talk about the insider trading of
American stocks by certain Israeli groups both in Canada and Germany
between August 26 and the Sept.11 attacks on the World Trade Center
and the Pentagon.
Government investigators have maintained a diplomatic silence about a
Department of Justice (DOJ) probe of possible profiteering by
interested parties with advance knowledge of the attack.
On Sept. 6, 2001, the Thursday before the tragedy, 2,075 put options
were made on United Airlines and on Sept. 10, the day before the
attacks, 2,282 put options were recorded for American Airlines. Given
the prices at the time, this could have yielded speculators between
$2 million and $4 million in profit.
The matter still is under investigation and none of the government
investigating bodies -including the FBI, the Securities and Exchange
Commission (SEC) and DOJ -are speaking to reporters about insider
trading. Even so, suspicion of insider trading to profit from the
Sept. 11 attacks is not limited to U.S. regulators. Investigations
were initiated in a number of places including Japan, Germany, the
United Kingdom, France, Luxembourg, Hong Kong, Switzerland and Spain.
As in the United States, all are treating these inquiries as if they
were state secrets.

http://tbrnews.org/Archives/a048.htm