AI
Sunday, October 05, 2003 6:43:15 PM
Short Seller Skirmishes Break Out on Widening Battlefield
Oct 3, 2003 (financialwire.net via COMTEX) -- (FinancialWire) Jag Media Holdings (OTCBB: JGMHA), A.G. Edwards (NYSE: AGE), GloTech Industries (OTCBB: GTHI), and Universal Express (OTCBB: USXP) were all at the forefront of a series of skirmishes in the short seller wars Thursday.
United States District Judge Virginia Gilmore denied the efforts by A.G. Edwards and some 100 brokers to have the manipulative trading cases filed against them by Jag Media and CEO Gary Valinoti dismissed, but instructed the plaintiffs to return with an amended fact-filled pleading within 20 days.
Meanwhile, GloTech Industries, Inc. (OTCBB: GTHI) became the 119th public company touched by the growing national scandal involving illegal manipulative trading that has so far escaped substantive attention or regulation by NASD or the U.S. Securities and Exchange Commission.
GloTech said it has learned that some of the Company's shareholders are having difficulty obtaining certificates from certain brokerage firms.
"Based upon preliminary research and information obtained from the Depository Trust Company, the Company believes that certain brokerage firms may have been engaging in a practice known as 'naked short sales'. It is the Company's understanding that a 'naked short' is created when a brokerage firm sells shares that it has neither purchased nor borrowed with the intent of either a) later purchasing the shares at a lower price and only then delivering them to the buyer or b) never delivering the shares sold. An effect of sustained 'naked shorting' can be 'artificial' or 'manufactured' downward pressure on the stock being sold. "Further, the Company understands that this practice is considered 'manipulative' and illegal. The Company believes that up to three hundred thousand (300,000) shares, or approximately seventeen (17) times GloTech's average daily trading volume, may have been sold in this fashion."
GloTech said its legal counsel are actively "investigating this occurrence and reviewing appropriate legal action and other available remedies. GloTech intends to vigorously work to protect the integrity of the market for its stock and the interests of its shareholders."
GloTech said it has been advised that the only way to be absolutely certain that shares purchased through a brokerage account are validly issued, is to demand physical delivery of a stock certificate evidencing ownership of the total number of shares purchased. "Therefore, it said, "the Company strongly recommends that all shareholders contact their brokerage firms and request physical delivery of their stock certificates immediately. Failure of the brokerage firm to deliver a customer's stock certificates in a timely manner may be an indicator of 'naked short sales'. Shareholders are encouraged to file a complaint against such brokerage firms with the NASD. Complaints can be filed online at www.nasd.com .
GloTech said it has discovered a growing body of litigation and published articles which, combined with increasing public awareness of the problem, should ultimately lead to market reforms in this area.
Meanwhile, GloTech said it will reimburse any related transfer costs paid by GloTech shareholders during the next ninety (90) days.
Universal Express, Inc. (OTCBB: USXP) reminded the public that on September 23 it urged shareholders to contact their congresspersons in the U.S. House of Representatives and the U.S. Senate to request the Securities and Exchange Commission to put an immediate end to "naked short selling".
Universal Express describes "naked short selling" as the electronic churning downward of the shares of small developing OTCBB companies without actually trading the shares.
Richard A. Altomare, President & CEO of Universal Express noted, "When you never intend or fail to cover short sales, you are counterfeiting stock. Counterfeit stock added to a float drives prices down. This abuse of short selling by the broker dealers and the market makers who conspire with them devastates small emerging companies."
"In what appears to be the first admission by an SEC regulator that naked short selling is occurring, SEC market regulation division director Annette Nazareth disclosed in a recent Dow Jones interview that the SEC would consider changes to short-selling rules this fall: "It's expected that the commission will consider short selling reforms in the next few months." To combat such abuses, the SEC will look to increase borrowing requirements for some short sales and call for stronger enforcement including late charges or other financial penalties for short sellers who fail to cover short positions by the settlement date, noted Dow Jones.
Altomare continued, "Naked short selling is nothing more than economic terrorism. It hurts job creation by small emerging firms; small emerging firms are the engines for new jobs. It is a national scandal that has cost us, along with other small companies and their shareholders, hundreds of millions of dollars in dramatically reduced share prices. Once the stock price drops, the next step for most small public companies is to cut back and start laying off. That is where the economic terrorism unfolds. Up to now, the SEC has done little to stop this activity. The SEC has not prevented illegal short selling in the OTCBB market, where the newer smaller emerging firms find themselves. The SEC's complex regulations are focused on the more established companies, the more established capital markets. Maintaining a small public company under these conditions is costly and sometimes not worthwhile. The SEC should not condone this economic terrorism. It should move forward with meaningful changes. We encourage our shareholders to contact their Representatives in the House and Senate about this short selling abuse. Changes are needed. All of us in the smaller business community want to grow. We want and look forward to working with the SEC's new leadership to restore integrity to the OTCBB markets."
Universal Express said it had been asked by the Denver office of the SEC to "prove" short-selling exists, but the company provided no update on that dialogue, which its counsel earlier described as an attempt to squelch the company's right of free speech.
There are 119 public companies that have so far been touched by the growing national financial scandal.
Some thirteen on the list of 119, such as A.G. Edwards, Inc. (NYSE: AGE), Ameritrade Holding Corp. (NASDAQ: AMTD), Deutsche Bank AG (NYSE: DB), E*Trade Group, Inc. (NYSE: ET), FleetBoston (NYSE: FBF), Goldman, Sachs & Co. (NYSE: GS), Knight Securities, LP (NASDAQ: NITE), Ladenburg Thalmann & Co., Inc. (AMEX: LHS), M. H. Myerson & Co., Inc. (NASDAQ: MHMY), Olde / H&R Block (NYSE: HRB), Charles Schwab (NYSE: SCH), Toronto-Dominion's (NYSE: TD), TD Waterhouse Group and vFinance, Inc. (OTCBB: VFIN), have been accused by one or more public companies as allegedly participating in short selling activities or abuses, or of failing to settle trades.
Observers have said that trades to not settle because broker-dealers do not effect buy-ins, as required by law, and that there is an unspoken understanding that any brokerage that tries to force a buy-in will be retaliated against.
The remaining 106 companies have issued press releases or been named in the media as having been victimized, or as taking various actions, either alone or in concert with other companies, to oppose manipulative trading in the form of illegal naked short selling. The actions have ranged from lawsuits to withdrawals and threatened withdrawals from the electronic trading system managed by the Depository Trust & Clearing Corp., to withdrawals from toxic financings, to the issuance of dividends or name changes designed to squeeze manipulators, to joining associations or networks or to contacting regulatory authorities to provide documentation of abuses or otherwise complain.
On June 4, the SEC stated "the issues surrounding naked short selling are not germane to the manner in which DTC operates as a depository registered as a clearing agency. Decisions to engage in such transactions are made by parties other than DTC. DTC does not allow its participants to establish short positions resulting from their failure to deliver securities at settlement. While the Commission appreciates commenters' concerns about manipulative activity, those concerns must be addressed by other means."
Nevertheless, short positions do in fact exist due to failures of the electronic settlement system to balance their electronic books, and the SEC has provided shareholders and small companies with no inkling of what the Commission has in mind in "addressing" these concerns "by other means."
However, in mid-September the SEC admitted in a Dow Jones interview that "naked short selling" is a problem, and said its market regulatory division is taking aim at the practice. However, one public company reported that two days later a field office of the SEC asked the public company to "prove naked short selling exists," once more seemingly sending mixed signals to shareholders trapped in the manipulators' vise.
Recently the NASD revealed its plan to stop the practices that have ravaged these public companies and their shareholders - a wrist-slap to perpetrators such as Paragon Capital Markets, which was "censured" and fined $35,000 after the NASD said it had "executed short-sale orders in certain securities and failed to make an affirmative determination prior to executing such transactions." An even smaller fine was subsequently assessed against vFinance for similar allegations.
The complete list of those 106 companies include Advanced Viral Research Corp. (OTCBB: ADVR), AdZone Research, Inc. (OTCBB: ADZR), Amazon Natural Treasures (OTC: ANTD), America's Senior Financial Services (OTCBB: AMSE), American Ammunition, Inc. (OTCBB: AAMI), AngelCiti Entertainment (OTCBB: AGLC), ATSI Communications, Inc. (OTC: ATSC), Federal Agricultural Mortgage / Farmer Mac (NYSE: AGM) Allied Capital (NYSE: ALD), American Motorcycle (OTC: AMCYV), American International Industries (OTCBB: AMIN), Ameri-Dream (OTC: AMDR), Adirondack Pure Springs Mt. Water Co. (OTCBB: APSW), Bluebook International (OTCBB: BBIC), Blue Industries (OTCBB: BLIIV), Bentley Communications (OTCBB: BTLY), BIFS Technologies Corporation (OTCBB: BIFT), Biocurex (OTCBB: BOCX). Broadleaf Capital Partners, Inc. (OTCBB: BDLF), Chattem, Inc. (NASDAQ: CHTT), Critical Home Care (OTCBB: CCLH), Composite Holdings (OTC: COHIA), CyberDigital, Inc. (OTCBB: CYBD). Diamond International Group (OTCBB: DMND), Dobson Communications Corp. (NASDAQ: DCEL), Eagle Tech Communications (OTC: EATC), Edgetech Services (OTCBB: EDGH);
Also, Endovasc Ltd. (OTCBB: EVSC), Enviro-Energy Corporation (OTCBB: ENGY), Environmental Products & Technologies (OTC: EPTC), EPIXTAR Corp. (OTCBB: EPXR), eResearchTechnologies, Inc. (NASDAQ: ERES), Flight Safety Technologies (OTCBB: FLST), Freddie Mac (NYSE: FRE), FreeStar Technologies (OTCBB: FSRCE), Geotec Thermal Generators, Inc. (OTCBB: GETC), Genesis Intermedia (OTC: GENI), GeneMax Corp. (OTCBB: GMXX), Global Explorations Inc (OTC: GXXL), Global Path (OTCBB: GBPI), GloTech Industries, Inc. (OTCBB: GTHI), Green Dolphin Systems (OTCBB: GLDS), Group Management (OTCBB: GPMT), Hop-On (OTC: HPON), H-Quotient, Inc., (OTCBB: HQNT), Hyperdynamics Corp. (OTCBB: HYPD), International Biochem (OTCBB: IBCL), Intergold Corp. (OTCBB: IGCO), International Broadcasting Corporation (OTCBB: IBCS), InternetStudios, Inc. (OTCBB: ISTO), ITIS Holdings (OTCBB: ITHH), Investco Corp. (OTCBB: IVCO), Lair Holdings (OTC: LAIR), Lifeline BioTechnologies Inc. (OTC: LBTT), Life Energy & Technology (OTCBB: LETH), MBIA (NYSE: MBI);
Also, MegaMania Interactive (OTC: MNIA), MetaSource Group, Inc. (OTCBB: MTSR), Midastrade.com (OTC: MIDS), Make Your Move (OTCBB: MKMV), Medinah Minerals (OTC: MDMN), MSM Jewelry Corp. (OTC: MSMC), Nanopierce Technologies, Inc. (OTCBB: NPCT), Nutra Pharmaceutical (OTCBB: NPHC), Nutek (OTCBB: NUTK), Navigator Ventures (OTC: NVGV), Orbit E-Commerce, Inc. (OTCBB: OECI), Pitts & Spitts (OTC: PSPP), Sales OnLine Direct (OTCBB: PAID), Pacel Corp. (OTCBB: PACC), PayStar Corporation (OTC: PYST), Petrogen Corp. (OTCBB: PTGC), Pinnacle Business Management (OTC: PCBM), Premier Development & Investment, Inc. (OTCBB: PDVN), PrimeHoldings.com, Inc. (OTC: PRIM), Phlo Corporation (OTCBB: PHLC), Resourcing Solutions (OTC: RESG), Reed Holdings (OTC: RDHC), Rocky Mountain Energy Corp. (OTCBB: RMECE), RTIN Holdings (OTCBB: RTNHE), Saflink Corp. (NASDAQ: SFLK), Safe Travel Care (OTCBB: SFTVV), Sedona Corp. (OTCBB: SDNA);
Also, Sionix Corp. (OTCBB: SINX), Sonoran Energy (OTCBB: SNRN), Starmax Technologies (OTC: SMXIF), Storage Suites America (OTC: SSUA), Suncomm Technologies (OTC: STEH), Sports Resorts International (NASDAQ: SPRI), Technology Logistics (OTC: TLOS), Swiss Medica, Inc. (OTCBB: SWME), Ten Stix, Inc. (OTCBB: TNTI), Tidelands Oil (OTCBB: TIDE), Titan Construction (OTC: TTCS), Trezac Corp. (OTCBB: TRZAV), Universal Express, Inc. (OTCBB: USXP), Valesc Holdings, Inc. (OTCBB: VLSHV), Vega Atlantic (OTCBB: VGAC), Viragen (AMEX: VRA), Viragen International (OTCBB: VGNI), Vista Continental Corporation, (OTCBB: VICC), Viva International (OTCBB: VIVI), Vtex Energy (OTCBB: VXENE) and Wizzard Software (OTCBB: WIZD), WorldTradeShow.com (OTC: WTSW) and Y3K Secure Enterprise Software, Inc. (OTCBB: YTHK).
For up-to-the-minute news, features and links click on www.financialwire.net
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FinancialWire is an independent, proprietary news service of Investrend Information, a division of Investrend Communications, Inc. Additionally, Investrend provides a wide range of forums, independent research and webcasting platforms for shareholder empowerment. For more information or to receive the FirstAlert daily summary of news, commentary, research reports, webcasts, events and conference calls, click on www.investrend.com/contact.asp
URL: www.financialwire.net
(C) 2003 financialwire.net, Inc. All rights reserved.
-0-
Short Seller Skirmishes Break Out on Widening Battlefield
Oct 3, 2003 (financialwire.net via COMTEX) -- (FinancialWire) Jag Media Holdings (OTCBB: JGMHA), A.G. Edwards (NYSE: AGE), GloTech Industries (OTCBB: GTHI), and Universal Express (OTCBB: USXP) were all at the forefront of a series of skirmishes in the short seller wars Thursday.
United States District Judge Virginia Gilmore denied the efforts by A.G. Edwards and some 100 brokers to have the manipulative trading cases filed against them by Jag Media and CEO Gary Valinoti dismissed, but instructed the plaintiffs to return with an amended fact-filled pleading within 20 days.
Meanwhile, GloTech Industries, Inc. (OTCBB: GTHI) became the 119th public company touched by the growing national scandal involving illegal manipulative trading that has so far escaped substantive attention or regulation by NASD or the U.S. Securities and Exchange Commission.
GloTech said it has learned that some of the Company's shareholders are having difficulty obtaining certificates from certain brokerage firms.
"Based upon preliminary research and information obtained from the Depository Trust Company, the Company believes that certain brokerage firms may have been engaging in a practice known as 'naked short sales'. It is the Company's understanding that a 'naked short' is created when a brokerage firm sells shares that it has neither purchased nor borrowed with the intent of either a) later purchasing the shares at a lower price and only then delivering them to the buyer or b) never delivering the shares sold. An effect of sustained 'naked shorting' can be 'artificial' or 'manufactured' downward pressure on the stock being sold. "Further, the Company understands that this practice is considered 'manipulative' and illegal. The Company believes that up to three hundred thousand (300,000) shares, or approximately seventeen (17) times GloTech's average daily trading volume, may have been sold in this fashion."
GloTech said its legal counsel are actively "investigating this occurrence and reviewing appropriate legal action and other available remedies. GloTech intends to vigorously work to protect the integrity of the market for its stock and the interests of its shareholders."
GloTech said it has been advised that the only way to be absolutely certain that shares purchased through a brokerage account are validly issued, is to demand physical delivery of a stock certificate evidencing ownership of the total number of shares purchased. "Therefore, it said, "the Company strongly recommends that all shareholders contact their brokerage firms and request physical delivery of their stock certificates immediately. Failure of the brokerage firm to deliver a customer's stock certificates in a timely manner may be an indicator of 'naked short sales'. Shareholders are encouraged to file a complaint against such brokerage firms with the NASD. Complaints can be filed online at www.nasd.com .
GloTech said it has discovered a growing body of litigation and published articles which, combined with increasing public awareness of the problem, should ultimately lead to market reforms in this area.
Meanwhile, GloTech said it will reimburse any related transfer costs paid by GloTech shareholders during the next ninety (90) days.
Universal Express, Inc. (OTCBB: USXP) reminded the public that on September 23 it urged shareholders to contact their congresspersons in the U.S. House of Representatives and the U.S. Senate to request the Securities and Exchange Commission to put an immediate end to "naked short selling".
Universal Express describes "naked short selling" as the electronic churning downward of the shares of small developing OTCBB companies without actually trading the shares.
Richard A. Altomare, President & CEO of Universal Express noted, "When you never intend or fail to cover short sales, you are counterfeiting stock. Counterfeit stock added to a float drives prices down. This abuse of short selling by the broker dealers and the market makers who conspire with them devastates small emerging companies."
"In what appears to be the first admission by an SEC regulator that naked short selling is occurring, SEC market regulation division director Annette Nazareth disclosed in a recent Dow Jones interview that the SEC would consider changes to short-selling rules this fall: "It's expected that the commission will consider short selling reforms in the next few months." To combat such abuses, the SEC will look to increase borrowing requirements for some short sales and call for stronger enforcement including late charges or other financial penalties for short sellers who fail to cover short positions by the settlement date, noted Dow Jones.
Altomare continued, "Naked short selling is nothing more than economic terrorism. It hurts job creation by small emerging firms; small emerging firms are the engines for new jobs. It is a national scandal that has cost us, along with other small companies and their shareholders, hundreds of millions of dollars in dramatically reduced share prices. Once the stock price drops, the next step for most small public companies is to cut back and start laying off. That is where the economic terrorism unfolds. Up to now, the SEC has done little to stop this activity. The SEC has not prevented illegal short selling in the OTCBB market, where the newer smaller emerging firms find themselves. The SEC's complex regulations are focused on the more established companies, the more established capital markets. Maintaining a small public company under these conditions is costly and sometimes not worthwhile. The SEC should not condone this economic terrorism. It should move forward with meaningful changes. We encourage our shareholders to contact their Representatives in the House and Senate about this short selling abuse. Changes are needed. All of us in the smaller business community want to grow. We want and look forward to working with the SEC's new leadership to restore integrity to the OTCBB markets."
Universal Express said it had been asked by the Denver office of the SEC to "prove" short-selling exists, but the company provided no update on that dialogue, which its counsel earlier described as an attempt to squelch the company's right of free speech.
There are 119 public companies that have so far been touched by the growing national financial scandal.
Some thirteen on the list of 119, such as A.G. Edwards, Inc. (NYSE: AGE), Ameritrade Holding Corp. (NASDAQ: AMTD), Deutsche Bank AG (NYSE: DB), E*Trade Group, Inc. (NYSE: ET), FleetBoston (NYSE: FBF), Goldman, Sachs & Co. (NYSE: GS), Knight Securities, LP (NASDAQ: NITE), Ladenburg Thalmann & Co., Inc. (AMEX: LHS), M. H. Myerson & Co., Inc. (NASDAQ: MHMY), Olde / H&R Block (NYSE: HRB), Charles Schwab (NYSE: SCH), Toronto-Dominion's (NYSE: TD), TD Waterhouse Group and vFinance, Inc. (OTCBB: VFIN), have been accused by one or more public companies as allegedly participating in short selling activities or abuses, or of failing to settle trades.
Observers have said that trades to not settle because broker-dealers do not effect buy-ins, as required by law, and that there is an unspoken understanding that any brokerage that tries to force a buy-in will be retaliated against.
The remaining 106 companies have issued press releases or been named in the media as having been victimized, or as taking various actions, either alone or in concert with other companies, to oppose manipulative trading in the form of illegal naked short selling. The actions have ranged from lawsuits to withdrawals and threatened withdrawals from the electronic trading system managed by the Depository Trust & Clearing Corp., to withdrawals from toxic financings, to the issuance of dividends or name changes designed to squeeze manipulators, to joining associations or networks or to contacting regulatory authorities to provide documentation of abuses or otherwise complain.
On June 4, the SEC stated "the issues surrounding naked short selling are not germane to the manner in which DTC operates as a depository registered as a clearing agency. Decisions to engage in such transactions are made by parties other than DTC. DTC does not allow its participants to establish short positions resulting from their failure to deliver securities at settlement. While the Commission appreciates commenters' concerns about manipulative activity, those concerns must be addressed by other means."
Nevertheless, short positions do in fact exist due to failures of the electronic settlement system to balance their electronic books, and the SEC has provided shareholders and small companies with no inkling of what the Commission has in mind in "addressing" these concerns "by other means."
However, in mid-September the SEC admitted in a Dow Jones interview that "naked short selling" is a problem, and said its market regulatory division is taking aim at the practice. However, one public company reported that two days later a field office of the SEC asked the public company to "prove naked short selling exists," once more seemingly sending mixed signals to shareholders trapped in the manipulators' vise.
Recently the NASD revealed its plan to stop the practices that have ravaged these public companies and their shareholders - a wrist-slap to perpetrators such as Paragon Capital Markets, which was "censured" and fined $35,000 after the NASD said it had "executed short-sale orders in certain securities and failed to make an affirmative determination prior to executing such transactions." An even smaller fine was subsequently assessed against vFinance for similar allegations.
The complete list of those 106 companies include Advanced Viral Research Corp. (OTCBB: ADVR), AdZone Research, Inc. (OTCBB: ADZR), Amazon Natural Treasures (OTC: ANTD), America's Senior Financial Services (OTCBB: AMSE), American Ammunition, Inc. (OTCBB: AAMI), AngelCiti Entertainment (OTCBB: AGLC), ATSI Communications, Inc. (OTC: ATSC), Federal Agricultural Mortgage / Farmer Mac (NYSE: AGM) Allied Capital (NYSE: ALD), American Motorcycle (OTC: AMCYV), American International Industries (OTCBB: AMIN), Ameri-Dream (OTC: AMDR), Adirondack Pure Springs Mt. Water Co. (OTCBB: APSW), Bluebook International (OTCBB: BBIC), Blue Industries (OTCBB: BLIIV), Bentley Communications (OTCBB: BTLY), BIFS Technologies Corporation (OTCBB: BIFT), Biocurex (OTCBB: BOCX). Broadleaf Capital Partners, Inc. (OTCBB: BDLF), Chattem, Inc. (NASDAQ: CHTT), Critical Home Care (OTCBB: CCLH), Composite Holdings (OTC: COHIA), CyberDigital, Inc. (OTCBB: CYBD). Diamond International Group (OTCBB: DMND), Dobson Communications Corp. (NASDAQ: DCEL), Eagle Tech Communications (OTC: EATC), Edgetech Services (OTCBB: EDGH);
Also, Endovasc Ltd. (OTCBB: EVSC), Enviro-Energy Corporation (OTCBB: ENGY), Environmental Products & Technologies (OTC: EPTC), EPIXTAR Corp. (OTCBB: EPXR), eResearchTechnologies, Inc. (NASDAQ: ERES), Flight Safety Technologies (OTCBB: FLST), Freddie Mac (NYSE: FRE), FreeStar Technologies (OTCBB: FSRCE), Geotec Thermal Generators, Inc. (OTCBB: GETC), Genesis Intermedia (OTC: GENI), GeneMax Corp. (OTCBB: GMXX), Global Explorations Inc (OTC: GXXL), Global Path (OTCBB: GBPI), GloTech Industries, Inc. (OTCBB: GTHI), Green Dolphin Systems (OTCBB: GLDS), Group Management (OTCBB: GPMT), Hop-On (OTC: HPON), H-Quotient, Inc., (OTCBB: HQNT), Hyperdynamics Corp. (OTCBB: HYPD), International Biochem (OTCBB: IBCL), Intergold Corp. (OTCBB: IGCO), International Broadcasting Corporation (OTCBB: IBCS), InternetStudios, Inc. (OTCBB: ISTO), ITIS Holdings (OTCBB: ITHH), Investco Corp. (OTCBB: IVCO), Lair Holdings (OTC: LAIR), Lifeline BioTechnologies Inc. (OTC: LBTT), Life Energy & Technology (OTCBB: LETH), MBIA (NYSE: MBI);
Also, MegaMania Interactive (OTC: MNIA), MetaSource Group, Inc. (OTCBB: MTSR), Midastrade.com (OTC: MIDS), Make Your Move (OTCBB: MKMV), Medinah Minerals (OTC: MDMN), MSM Jewelry Corp. (OTC: MSMC), Nanopierce Technologies, Inc. (OTCBB: NPCT), Nutra Pharmaceutical (OTCBB: NPHC), Nutek (OTCBB: NUTK), Navigator Ventures (OTC: NVGV), Orbit E-Commerce, Inc. (OTCBB: OECI), Pitts & Spitts (OTC: PSPP), Sales OnLine Direct (OTCBB: PAID), Pacel Corp. (OTCBB: PACC), PayStar Corporation (OTC: PYST), Petrogen Corp. (OTCBB: PTGC), Pinnacle Business Management (OTC: PCBM), Premier Development & Investment, Inc. (OTCBB: PDVN), PrimeHoldings.com, Inc. (OTC: PRIM), Phlo Corporation (OTCBB: PHLC), Resourcing Solutions (OTC: RESG), Reed Holdings (OTC: RDHC), Rocky Mountain Energy Corp. (OTCBB: RMECE), RTIN Holdings (OTCBB: RTNHE), Saflink Corp. (NASDAQ: SFLK), Safe Travel Care (OTCBB: SFTVV), Sedona Corp. (OTCBB: SDNA);
Also, Sionix Corp. (OTCBB: SINX), Sonoran Energy (OTCBB: SNRN), Starmax Technologies (OTC: SMXIF), Storage Suites America (OTC: SSUA), Suncomm Technologies (OTC: STEH), Sports Resorts International (NASDAQ: SPRI), Technology Logistics (OTC: TLOS), Swiss Medica, Inc. (OTCBB: SWME), Ten Stix, Inc. (OTCBB: TNTI), Tidelands Oil (OTCBB: TIDE), Titan Construction (OTC: TTCS), Trezac Corp. (OTCBB: TRZAV), Universal Express, Inc. (OTCBB: USXP), Valesc Holdings, Inc. (OTCBB: VLSHV), Vega Atlantic (OTCBB: VGAC), Viragen (AMEX: VRA), Viragen International (OTCBB: VGNI), Vista Continental Corporation, (OTCBB: VICC), Viva International (OTCBB: VIVI), Vtex Energy (OTCBB: VXENE) and Wizzard Software (OTCBB: WIZD), WorldTradeShow.com (OTC: WTSW) and Y3K Secure Enterprise Software, Inc. (OTCBB: YTHK).
For up-to-the-minute news, features and links click on www.financialwire.net
For FinancialWire audio clips, click on partner ON24 at www.on24news.com
FinancialWire is an independent, proprietary news service of Investrend Information, a division of Investrend Communications, Inc. Additionally, Investrend provides a wide range of forums, independent research and webcasting platforms for shareholder empowerment. For more information or to receive the FirstAlert daily summary of news, commentary, research reports, webcasts, events and conference calls, click on www.investrend.com/contact.asp
URL: www.financialwire.net
(C) 2003 financialwire.net, Inc. All rights reserved.
-0-
Short Seller Skirmishes Break Out on Widening Battlefield
Oct 3, 2003 (financialwire.net via COMTEX) -- (FinancialWire) Jag Media Holdings (OTCBB: JGMHA), A.G. Edwards (NYSE: AGE), GloTech Industries (OTCBB: GTHI), and Universal Express (OTCBB: USXP) were all at the forefront of a series of skirmishes in the short seller wars Thursday.
United States District Judge Virginia Gilmore denied the efforts by A.G. Edwards and some 100 brokers to have the manipulative trading cases filed against them by Jag Media and CEO Gary Valinoti dismissed, but instructed the plaintiffs to return with an amended fact-filled pleading within 20 days.
Meanwhile, GloTech Industries, Inc. (OTCBB: GTHI) became the 119th public company touched by the growing national scandal involving illegal manipulative trading that has so far escaped substantive attention or regulation by NASD or the U.S. Securities and Exchange Commission.
GloTech said it has learned that some of the Company's shareholders are having difficulty obtaining certificates from certain brokerage firms.
"Based upon preliminary research and information obtained from the Depository Trust Company, the Company believes that certain brokerage firms may have been engaging in a practice known as 'naked short sales'. It is the Company's understanding that a 'naked short' is created when a brokerage firm sells shares that it has neither purchased nor borrowed with the intent of either a) later purchasing the shares at a lower price and only then delivering them to the buyer or b) never delivering the shares sold. An effect of sustained 'naked shorting' can be 'artificial' or 'manufactured' downward pressure on the stock being sold. "Further, the Company understands that this practice is considered 'manipulative' and illegal. The Company believes that up to three hundred thousand (300,000) shares, or approximately seventeen (17) times GloTech's average daily trading volume, may have been sold in this fashion."
GloTech said its legal counsel are actively "investigating this occurrence and reviewing appropriate legal action and other available remedies. GloTech intends to vigorously work to protect the integrity of the market for its stock and the interests of its shareholders."
GloTech said it has been advised that the only way to be absolutely certain that shares purchased through a brokerage account are validly issued, is to demand physical delivery of a stock certificate evidencing ownership of the total number of shares purchased. "Therefore, it said, "the Company strongly recommends that all shareholders contact their brokerage firms and request physical delivery of their stock certificates immediately. Failure of the brokerage firm to deliver a customer's stock certificates in a timely manner may be an indicator of 'naked short sales'. Shareholders are encouraged to file a complaint against such brokerage firms with the NASD. Complaints can be filed online at www.nasd.com .
GloTech said it has discovered a growing body of litigation and published articles which, combined with increasing public awareness of the problem, should ultimately lead to market reforms in this area.
Meanwhile, GloTech said it will reimburse any related transfer costs paid by GloTech shareholders during the next ninety (90) days.
Universal Express, Inc. (OTCBB: USXP) reminded the public that on September 23 it urged shareholders to contact their congresspersons in the U.S. House of Representatives and the U.S. Senate to request the Securities and Exchange Commission to put an immediate end to "naked short selling".
Universal Express describes "naked short selling" as the electronic churning downward of the shares of small developing OTCBB companies without actually trading the shares.
Richard A. Altomare, President & CEO of Universal Express noted, "When you never intend or fail to cover short sales, you are counterfeiting stock. Counterfeit stock added to a float drives prices down. This abuse of short selling by the broker dealers and the market makers who conspire with them devastates small emerging companies."
"In what appears to be the first admission by an SEC regulator that naked short selling is occurring, SEC market regulation division director Annette Nazareth disclosed in a recent Dow Jones interview that the SEC would consider changes to short-selling rules this fall: "It's expected that the commission will consider short selling reforms in the next few months." To combat such abuses, the SEC will look to increase borrowing requirements for some short sales and call for stronger enforcement including late charges or other financial penalties for short sellers who fail to cover short positions by the settlement date, noted Dow Jones.
Altomare continued, "Naked short selling is nothing more than economic terrorism. It hurts job creation by small emerging firms; small emerging firms are the engines for new jobs. It is a national scandal that has cost us, along with other small companies and their shareholders, hundreds of millions of dollars in dramatically reduced share prices. Once the stock price drops, the next step for most small public companies is to cut back and start laying off. That is where the economic terrorism unfolds. Up to now, the SEC has done little to stop this activity. The SEC has not prevented illegal short selling in the OTCBB market, where the newer smaller emerging firms find themselves. The SEC's complex regulations are focused on the more established companies, the more established capital markets. Maintaining a small public company under these conditions is costly and sometimes not worthwhile. The SEC should not condone this economic terrorism. It should move forward with meaningful changes. We encourage our shareholders to contact their Representatives in the House and Senate about this short selling abuse. Changes are needed. All of us in the smaller business community want to grow. We want and look forward to working with the SEC's new leadership to restore integrity to the OTCBB markets."
Universal Express said it had been asked by the Denver office of the SEC to "prove" short-selling exists, but the company provided no update on that dialogue, which its counsel earlier described as an attempt to squelch the company's right of free speech.
There are 119 public companies that have so far been touched by the growing national financial scandal.
Some thirteen on the list of 119, such as A.G. Edwards, Inc. (NYSE: AGE), Ameritrade Holding Corp. (NASDAQ: AMTD), Deutsche Bank AG (NYSE: DB), E*Trade Group, Inc. (NYSE: ET), FleetBoston (NYSE: FBF), Goldman, Sachs & Co. (NYSE: GS), Knight Securities, LP (NASDAQ: NITE), Ladenburg Thalmann & Co., Inc. (AMEX: LHS), M. H. Myerson & Co., Inc. (NASDAQ: MHMY), Olde / H&R Block (NYSE: HRB), Charles Schwab (NYSE: SCH), Toronto-Dominion's (NYSE: TD), TD Waterhouse Group and vFinance, Inc. (OTCBB: VFIN), have been accused by one or more public companies as allegedly participating in short selling activities or abuses, or of failing to settle trades.
Observers have said that trades to not settle because broker-dealers do not effect buy-ins, as required by law, and that there is an unspoken understanding that any brokerage that tries to force a buy-in will be retaliated against.
The remaining 106 companies have issued press releases or been named in the media as having been victimized, or as taking various actions, either alone or in concert with other companies, to oppose manipulative trading in the form of illegal naked short selling. The actions have ranged from lawsuits to withdrawals and threatened withdrawals from the electronic trading system managed by the Depository Trust & Clearing Corp., to withdrawals from toxic financings, to the issuance of dividends or name changes designed to squeeze manipulators, to joining associations or networks or to contacting regulatory authorities to provide documentation of abuses or otherwise complain.
On June 4, the SEC stated "the issues surrounding naked short selling are not germane to the manner in which DTC operates as a depository registered as a clearing agency. Decisions to engage in such transactions are made by parties other than DTC. DTC does not allow its participants to establish short positions resulting from their failure to deliver securities at settlement. While the Commission appreciates commenters' concerns about manipulative activity, those concerns must be addressed by other means."
Nevertheless, short positions do in fact exist due to failures of the electronic settlement system to balance their electronic books, and the SEC has provided shareholders and small companies with no inkling of what the Commission has in mind in "addressing" these concerns "by other means."
However, in mid-September the SEC admitted in a Dow Jones interview that "naked short selling" is a problem, and said its market regulatory division is taking aim at the practice. However, one public company reported that two days later a field office of the SEC asked the public company to "prove naked short selling exists," once more seemingly sending mixed signals to shareholders trapped in the manipulators' vise.
Recently the NASD revealed its plan to stop the practices that have ravaged these public companies and their shareholders - a wrist-slap to perpetrators such as Paragon Capital Markets, which was "censured" and fined $35,000 after the NASD said it had "executed short-sale orders in certain securities and failed to make an affirmative determination prior to executing such transactions." An even smaller fine was subsequently assessed against vFinance for similar allegations.
The complete list of those 106 companies include Advanced Viral Research Corp. (OTCBB: ADVR), AdZone Research, Inc. (OTCBB: ADZR), Amazon Natural Treasures (OTC: ANTD), America's Senior Financial Services (OTCBB: AMSE), American Ammunition, Inc. (OTCBB: AAMI), AngelCiti Entertainment (OTCBB: AGLC), ATSI Communications, Inc. (OTC: ATSC), Federal Agricultural Mortgage / Farmer Mac (NYSE: AGM) Allied Capital (NYSE: ALD), American Motorcycle (OTC: AMCYV), American International Industries (OTCBB: AMIN), Ameri-Dream (OTC: AMDR), Adirondack Pure Springs Mt. Water Co. (OTCBB: APSW), Bluebook International (OTCBB: BBIC), Blue Industries (OTCBB: BLIIV), Bentley Communications (OTCBB: BTLY), BIFS Technologies Corporation (OTCBB: BIFT), Biocurex (OTCBB: BOCX). Broadleaf Capital Partners, Inc. (OTCBB: BDLF), Chattem, Inc. (NASDAQ: CHTT), Critical Home Care (OTCBB: CCLH), Composite Holdings (OTC: COHIA), CyberDigital, Inc. (OTCBB: CYBD). Diamond International Group (OTCBB: DMND), Dobson Communications Corp. (NASDAQ: DCEL), Eagle Tech Communications (OTC: EATC), Edgetech Services (OTCBB: EDGH);
Also, Endovasc Ltd. (OTCBB: EVSC), Enviro-Energy Corporation (OTCBB: ENGY), Environmental Products & Technologies (OTC: EPTC), EPIXTAR Corp. (OTCBB: EPXR), eResearchTechnologies, Inc. (NASDAQ: ERES), Flight Safety Technologies (OTCBB: FLST), Freddie Mac (NYSE: FRE), FreeStar Technologies (OTCBB: FSRCE), Geotec Thermal Generators, Inc. (OTCBB: GETC), Genesis Intermedia (OTC: GENI), GeneMax Corp. (OTCBB: GMXX), Global Explorations Inc (OTC: GXXL), Global Path (OTCBB: GBPI), GloTech Industries, Inc. (OTCBB: GTHI), Green Dolphin Systems (OTCBB: GLDS), Group Management (OTCBB: GPMT), Hop-On (OTC: HPON), H-Quotient, Inc., (OTCBB: HQNT), Hyperdynamics Corp. (OTCBB: HYPD), International Biochem (OTCBB: IBCL), Intergold Corp. (OTCBB: IGCO), International Broadcasting Corporation (OTCBB: IBCS), InternetStudios, Inc. (OTCBB: ISTO), ITIS Holdings (OTCBB: ITHH), Investco Corp. (OTCBB: IVCO), Lair Holdings (OTC: LAIR), Lifeline BioTechnologies Inc. (OTC: LBTT), Life Energy & Technology (OTCBB: LETH), MBIA (NYSE: MBI);
Also, MegaMania Interactive (OTC: MNIA), MetaSource Group, Inc. (OTCBB: MTSR), Midastrade.com (OTC: MIDS), Make Your Move (OTCBB: MKMV), Medinah Minerals (OTC: MDMN), MSM Jewelry Corp. (OTC: MSMC), Nanopierce Technologies, Inc. (OTCBB: NPCT), Nutra Pharmaceutical (OTCBB: NPHC), Nutek (OTCBB: NUTK), Navigator Ventures (OTC: NVGV), Orbit E-Commerce, Inc. (OTCBB: OECI), Pitts & Spitts (OTC: PSPP), Sales OnLine Direct (OTCBB: PAID), Pacel Corp. (OTCBB: PACC), PayStar Corporation (OTC: PYST), Petrogen Corp. (OTCBB: PTGC), Pinnacle Business Management (OTC: PCBM), Premier Development & Investment, Inc. (OTCBB: PDVN), PrimeHoldings.com, Inc. (OTC: PRIM), Phlo Corporation (OTCBB: PHLC), Resourcing Solutions (OTC: RESG), Reed Holdings (OTC: RDHC), Rocky Mountain Energy Corp. (OTCBB: RMECE), RTIN Holdings (OTCBB: RTNHE), Saflink Corp. (NASDAQ: SFLK), Safe Travel Care (OTCBB: SFTVV), Sedona Corp. (OTCBB: SDNA);
Also, Sionix Corp. (OTCBB: SINX), Sonoran Energy (OTCBB: SNRN), Starmax Technologies (OTC: SMXIF), Storage Suites America (OTC: SSUA), Suncomm Technologies (OTC: STEH), Sports Resorts International (NASDAQ: SPRI), Technology Logistics (OTC: TLOS), Swiss Medica, Inc. (OTCBB: SWME), Ten Stix, Inc. (OTCBB: TNTI), Tidelands Oil (OTCBB: TIDE), Titan Construction (OTC: TTCS), Trezac Corp. (OTCBB: TRZAV), Universal Express, Inc. (OTCBB: USXP), Valesc Holdings, Inc. (OTCBB: VLSHV), Vega Atlantic (OTCBB: VGAC), Viragen (AMEX: VRA), Viragen International (OTCBB: VGNI), Vista Continental Corporation, (OTCBB: VICC), Viva International (OTCBB: VIVI), Vtex Energy (OTCBB: VXENE) and Wizzard Software (OTCBB: WIZD), WorldTradeShow.com (OTC: WTSW) and Y3K Secure Enterprise Software, Inc. (OTCBB: YTHK).
For up-to-the-minute news, features and links click on www.financialwire.net
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FinancialWire is an independent, proprietary news service of Investrend Information, a division of Investrend Communications, Inc. Additionally, Investrend provides a wide range of forums, independent research and webcasting platforms for shareholder empowerment. For more information or to receive the FirstAlert daily summary of news, commentary, research reports, webcasts, events and conference calls, click on www.investrend.com/contact.asp
URL: www.financialwire.net
(C) 2003 financialwire.net, Inc. All rights reserved.
-0-
Short Seller Skirmishes Break Out on Widening Battlefield
Oct 3, 2003 (financialwire.net via COMTEX) -- (FinancialWire) Jag Media Holdings (OTCBB: JGMHA), A.G. Edwards (NYSE: AGE), GloTech Industries (OTCBB: GTHI), and Universal Express (OTCBB: USXP) were all at the forefront of a series of skirmishes in the short seller wars Thursday.
United States District Judge Virginia Gilmore denied the efforts by A.G. Edwards and some 100 brokers to have the manipulative trading cases filed against them by Jag Media and CEO Gary Valinoti dismissed, but instructed the plaintiffs to return with an amended fact-filled pleading within 20 days.
Meanwhile, GloTech Industries, Inc. (OTCBB: GTHI) became the 119th public company touched by the growing national scandal involving illegal manipulative trading that has so far escaped substantive attention or regulation by NASD or the U.S. Securities and Exchange Commission.
GloTech said it has learned that some of the Company's shareholders are having difficulty obtaining certificates from certain brokerage firms.
"Based upon preliminary research and information obtained from the Depository Trust Company, the Company believes that certain brokerage firms may have been engaging in a practice known as 'naked short sales'. It is the Company's understanding that a 'naked short' is created when a brokerage firm sells shares that it has neither purchased nor borrowed with the intent of either a) later purchasing the shares at a lower price and only then delivering them to the buyer or b) never delivering the shares sold. An effect of sustained 'naked shorting' can be 'artificial' or 'manufactured' downward pressure on the stock being sold. "Further, the Company understands that this practice is considered 'manipulative' and illegal. The Company believes that up to three hundred thousand (300,000) shares, or approximately seventeen (17) times GloTech's average daily trading volume, may have been sold in this fashion."
GloTech said its legal counsel are actively "investigating this occurrence and reviewing appropriate legal action and other available remedies. GloTech intends to vigorously work to protect the integrity of the market for its stock and the interests of its shareholders."
GloTech said it has been advised that the only way to be absolutely certain that shares purchased through a brokerage account are validly issued, is to demand physical delivery of a stock certificate evidencing ownership of the total number of shares purchased. "Therefore, it said, "the Company strongly recommends that all shareholders contact their brokerage firms and request physical delivery of their stock certificates immediately. Failure of the brokerage firm to deliver a customer's stock certificates in a timely manner may be an indicator of 'naked short sales'. Shareholders are encouraged to file a complaint against such brokerage firms with the NASD. Complaints can be filed online at www.nasd.com .
GloTech said it has discovered a growing body of litigation and published articles which, combined with increasing public awareness of the problem, should ultimately lead to market reforms in this area.
Meanwhile, GloTech said it will reimburse any related transfer costs paid by GloTech shareholders during the next ninety (90) days.
Universal Express, Inc. (OTCBB: USXP) reminded the public that on September 23 it urged shareholders to contact their congresspersons in the U.S. House of Representatives and the U.S. Senate to request the Securities and Exchange Commission to put an immediate end to "naked short selling".
Universal Express describes "naked short selling" as the electronic churning downward of the shares of small developing OTCBB companies without actually trading the shares.
Richard A. Altomare, President & CEO of Universal Express noted, "When you never intend or fail to cover short sales, you are counterfeiting stock. Counterfeit stock added to a float drives prices down. This abuse of short selling by the broker dealers and the market makers who conspire with them devastates small emerging companies."
"In what appears to be the first admission by an SEC regulator that naked short selling is occurring, SEC market regulation division director Annette Nazareth disclosed in a recent Dow Jones interview that the SEC would consider changes to short-selling rules this fall: "It's expected that the commission will consider short selling reforms in the next few months." To combat such abuses, the SEC will look to increase borrowing requirements for some short sales and call for stronger enforcement including late charges or other financial penalties for short sellers who fail to cover short positions by the settlement date, noted Dow Jones.
Altomare continued, "Naked short selling is nothing more than economic terrorism. It hurts job creation by small emerging firms; small emerging firms are the engines for new jobs. It is a national scandal that has cost us, along with other small companies and their shareholders, hundreds of millions of dollars in dramatically reduced share prices. Once the stock price drops, the next step for most small public companies is to cut back and start laying off. That is where the economic terrorism unfolds. Up to now, the SEC has done little to stop this activity. The SEC has not prevented illegal short selling in the OTCBB market, where the newer smaller emerging firms find themselves. The SEC's complex regulations are focused on the more established companies, the more established capital markets. Maintaining a small public company under these conditions is costly and sometimes not worthwhile. The SEC should not condone this economic terrorism. It should move forward with meaningful changes. We encourage our shareholders to contact their Representatives in the House and Senate about this short selling abuse. Changes are needed. All of us in the smaller business community want to grow. We want and look forward to working with the SEC's new leadership to restore integrity to the OTCBB markets."
Universal Express said it had been asked by the Denver office of the SEC to "prove" short-selling exists, but the company provided no update on that dialogue, which its counsel earlier described as an attempt to squelch the company's right of free speech.
There are 119 public companies that have so far been touched by the growing national financial scandal.
Some thirteen on the list of 119, such as A.G. Edwards, Inc. (NYSE: AGE), Ameritrade Holding Corp. (NASDAQ: AMTD), Deutsche Bank AG (NYSE: DB), E*Trade Group, Inc. (NYSE: ET), FleetBoston (NYSE: FBF), Goldman, Sachs & Co. (NYSE: GS), Knight Securities, LP (NASDAQ: NITE), Ladenburg Thalmann & Co., Inc. (AMEX: LHS), M. H. Myerson & Co., Inc. (NASDAQ: MHMY), Olde / H&R Block (NYSE: HRB), Charles Schwab (NYSE: SCH), Toronto-Dominion's (NYSE: TD), TD Waterhouse Group and vFinance, Inc. (OTCBB: VFIN), have been accused by one or more public companies as allegedly participating in short selling activities or abuses, or of failing to settle trades.
Observers have said that trades to not settle because broker-dealers do not effect buy-ins, as required by law, and that there is an unspoken understanding that any brokerage that tries to force a buy-in will be retaliated against.
The remaining 106 companies have issued press releases or been named in the media as having been victimized, or as taking various actions, either alone or in concert with other companies, to oppose manipulative trading in the form of illegal naked short selling. The actions have ranged from lawsuits to withdrawals and threatened withdrawals from the electronic trading system managed by the Depository Trust & Clearing Corp., to withdrawals from toxic financings, to the issuance of dividends or name changes designed to squeeze manipulators, to joining associations or networks or to contacting regulatory authorities to provide documentation of abuses or otherwise complain.
On June 4, the SEC stated "the issues surrounding naked short selling are not germane to the manner in which DTC operates as a depository registered as a clearing agency. Decisions to engage in such transactions are made by parties other than DTC. DTC does not allow its participants to establish short positions resulting from their failure to deliver securities at settlement. While the Commission appreciates commenters' concerns about manipulative activity, those concerns must be addressed by other means."
Nevertheless, short positions do in fact exist due to failures of the electronic settlement system to balance their electronic books, and the SEC has provided shareholders and small companies with no inkling of what the Commission has in mind in "addressing" these concerns "by other means."
However, in mid-September the SEC admitted in a Dow Jones interview that "naked short selling" is a problem, and said its market regulatory division is taking aim at the practice. However, one public company reported that two days later a field office of the SEC asked the public company to "prove naked short selling exists," once more seemingly sending mixed signals to shareholders trapped in the manipulators' vise.
Recently the NASD revealed its plan to stop the practices that have ravaged these public companies and their shareholders - a wrist-slap to perpetrators such as Paragon Capital Markets, which was "censured" and fined $35,000 after the NASD said it had "executed short-sale orders in certain securities and failed to make an affirmative determination prior to executing such transactions." An even smaller fine was subsequently assessed against vFinance for similar allegations.
The complete list of those 106 companies include Advanced Viral Research Corp. (OTCBB: ADVR), AdZone Research, Inc. (OTCBB: ADZR), Amazon Natural Treasures (OTC: ANTD), America's Senior Financial Services (OTCBB: AMSE), American Ammunition, Inc. (OTCBB: AAMI), AngelCiti Entertainment (OTCBB: AGLC), ATSI Communications, Inc. (OTC: ATSC), Federal Agricultural Mortgage / Farmer Mac (NYSE: AGM) Allied Capital (NYSE: ALD), American Motorcycle (OTC: AMCYV), American International Industries (OTCBB: AMIN), Ameri-Dream (OTC: AMDR), Adirondack Pure Springs Mt. Water Co. (OTCBB: APSW), Bluebook International (OTCBB: BBIC), Blue Industries (OTCBB: BLIIV), Bentley Communications (OTCBB: BTLY), BIFS Technologies Corporation (OTCBB: BIFT), Biocurex (OTCBB: BOCX). Broadleaf Capital Partners, Inc. (OTCBB: BDLF), Chattem, Inc. (NASDAQ: CHTT), Critical Home Care (OTCBB: CCLH), Composite Holdings (OTC: COHIA), CyberDigital, Inc. (OTCBB: CYBD). Diamond International Group (OTCBB: DMND), Dobson Communications Corp. (NASDAQ: DCEL), Eagle Tech Communications (OTC: EATC), Edgetech Services (OTCBB: EDGH);
Also, Endovasc Ltd. (OTCBB: EVSC), Enviro-Energy Corporation (OTCBB: ENGY), Environmental Products & Technologies (OTC: EPTC), EPIXTAR Corp. (OTCBB: EPXR), eResearchTechnologies, Inc. (NASDAQ: ERES), Flight Safety Technologies (OTCBB: FLST), Freddie Mac (NYSE: FRE), FreeStar Technologies (OTCBB: FSRCE), Geotec Thermal Generators, Inc. (OTCBB: GETC), Genesis Intermedia (OTC: GENI), GeneMax Corp. (OTCBB: GMXX), Global Explorations Inc (OTC: GXXL), Global Path (OTCBB: GBPI), GloTech Industries, Inc. (OTCBB: GTHI), Green Dolphin Systems (OTCBB: GLDS), Group Management (OTCBB: GPMT), Hop-On (OTC: HPON), H-Quotient, Inc., (OTCBB: HQNT), Hyperdynamics Corp. (OTCBB: HYPD), International Biochem (OTCBB: IBCL), Intergold Corp. (OTCBB: IGCO), International Broadcasting Corporation (OTCBB: IBCS), InternetStudios, Inc. (OTCBB: ISTO), ITIS Holdings (OTCBB: ITHH), Investco Corp. (OTCBB: IVCO), Lair Holdings (OTC: LAIR), Lifeline BioTechnologies Inc. (OTC: LBTT), Life Energy & Technology (OTCBB: LETH), MBIA (NYSE: MBI);
Also, MegaMania Interactive (OTC: MNIA), MetaSource Group, Inc. (OTCBB: MTSR), Midastrade.com (OTC: MIDS), Make Your Move (OTCBB: MKMV), Medinah Minerals (OTC: MDMN), MSM Jewelry Corp. (OTC: MSMC), Nanopierce Technologies, Inc. (OTCBB: NPCT), Nutra Pharmaceutical (OTCBB: NPHC), Nutek (OTCBB: NUTK), Navigator Ventures (OTC: NVGV), Orbit E-Commerce, Inc. (OTCBB: OECI), Pitts & Spitts (OTC: PSPP), Sales OnLine Direct (OTCBB: PAID), Pacel Corp. (OTCBB: PACC), PayStar Corporation (OTC: PYST), Petrogen Corp. (OTCBB: PTGC), Pinnacle Business Management (OTC: PCBM), Premier Development & Investment, Inc. (OTCBB: PDVN), PrimeHoldings.com, Inc. (OTC: PRIM), Phlo Corporation (OTCBB: PHLC), Resourcing Solutions (OTC: RESG), Reed Holdings (OTC: RDHC), Rocky Mountain Energy Corp. (OTCBB: RMECE), RTIN Holdings (OTCBB: RTNHE), Saflink Corp. (NASDAQ: SFLK), Safe Travel Care (OTCBB: SFTVV), Sedona Corp. (OTCBB: SDNA);
Also, Sionix Corp. (OTCBB: SINX), Sonoran Energy (OTCBB: SNRN), Starmax Technologies (OTC: SMXIF), Storage Suites America (OTC: SSUA), Suncomm Technologies (OTC: STEH), Sports Resorts International (NASDAQ: SPRI), Technology Logistics (OTC: TLOS), Swiss Medica, Inc. (OTCBB: SWME), Ten Stix, Inc. (OTCBB: TNTI), Tidelands Oil (OTCBB: TIDE), Titan Construction (OTC: TTCS), Trezac Corp. (OTCBB: TRZAV), Universal Express, Inc. (OTCBB: USXP), Valesc Holdings, Inc. (OTCBB: VLSHV), Vega Atlantic (OTCBB: VGAC), Viragen (AMEX: VRA), Viragen International (OTCBB: VGNI), Vista Continental Corporation, (OTCBB: VICC), Viva International (OTCBB: VIVI), Vtex Energy (OTCBB: VXENE) and Wizzard Software (OTCBB: WIZD), WorldTradeShow.com (OTC: WTSW) and Y3K Secure Enterprise Software, Inc. (OTCBB: YTHK).
For up-to-the-minute news, features and links click on www.financialwire.net
For FinancialWire audio clips, click on partner ON24 at www.on24news.com
FinancialWire is an independent, proprietary news service of Investrend Information, a division of Investrend Communications, Inc. Additionally, Investrend provides a wide range of forums, independent research and webcasting platforms for shareholder empowerment. For more information or to receive the FirstAlert daily summary of news, commentary, research reports, webcasts, events and conference calls, click on www.investrend.com/contact.asp
URL: www.financialwire.net
(C) 2003 financialwire.net, Inc. All rights reserved.
-0-
Oct 3, 2003 (financialwire.net via COMTEX) -- (FinancialWire) Jag Media Holdings (OTCBB: JGMHA), A.G. Edwards (NYSE: AGE), GloTech Industries (OTCBB: GTHI), and Universal Express (OTCBB: USXP) were all at the forefront of a series of skirmishes in the short seller wars Thursday.
United States District Judge Virginia Gilmore denied the efforts by A.G. Edwards and some 100 brokers to have the manipulative trading cases filed against them by Jag Media and CEO Gary Valinoti dismissed, but instructed the plaintiffs to return with an amended fact-filled pleading within 20 days.
Meanwhile, GloTech Industries, Inc. (OTCBB: GTHI) became the 119th public company touched by the growing national scandal involving illegal manipulative trading that has so far escaped substantive attention or regulation by NASD or the U.S. Securities and Exchange Commission.
GloTech said it has learned that some of the Company's shareholders are having difficulty obtaining certificates from certain brokerage firms.
"Based upon preliminary research and information obtained from the Depository Trust Company, the Company believes that certain brokerage firms may have been engaging in a practice known as 'naked short sales'. It is the Company's understanding that a 'naked short' is created when a brokerage firm sells shares that it has neither purchased nor borrowed with the intent of either a) later purchasing the shares at a lower price and only then delivering them to the buyer or b) never delivering the shares sold. An effect of sustained 'naked shorting' can be 'artificial' or 'manufactured' downward pressure on the stock being sold. "Further, the Company understands that this practice is considered 'manipulative' and illegal. The Company believes that up to three hundred thousand (300,000) shares, or approximately seventeen (17) times GloTech's average daily trading volume, may have been sold in this fashion."
GloTech said its legal counsel are actively "investigating this occurrence and reviewing appropriate legal action and other available remedies. GloTech intends to vigorously work to protect the integrity of the market for its stock and the interests of its shareholders."
GloTech said it has been advised that the only way to be absolutely certain that shares purchased through a brokerage account are validly issued, is to demand physical delivery of a stock certificate evidencing ownership of the total number of shares purchased. "Therefore, it said, "the Company strongly recommends that all shareholders contact their brokerage firms and request physical delivery of their stock certificates immediately. Failure of the brokerage firm to deliver a customer's stock certificates in a timely manner may be an indicator of 'naked short sales'. Shareholders are encouraged to file a complaint against such brokerage firms with the NASD. Complaints can be filed online at www.nasd.com .
GloTech said it has discovered a growing body of litigation and published articles which, combined with increasing public awareness of the problem, should ultimately lead to market reforms in this area.
Meanwhile, GloTech said it will reimburse any related transfer costs paid by GloTech shareholders during the next ninety (90) days.
Universal Express, Inc. (OTCBB: USXP) reminded the public that on September 23 it urged shareholders to contact their congresspersons in the U.S. House of Representatives and the U.S. Senate to request the Securities and Exchange Commission to put an immediate end to "naked short selling".
Universal Express describes "naked short selling" as the electronic churning downward of the shares of small developing OTCBB companies without actually trading the shares.
Richard A. Altomare, President & CEO of Universal Express noted, "When you never intend or fail to cover short sales, you are counterfeiting stock. Counterfeit stock added to a float drives prices down. This abuse of short selling by the broker dealers and the market makers who conspire with them devastates small emerging companies."
"In what appears to be the first admission by an SEC regulator that naked short selling is occurring, SEC market regulation division director Annette Nazareth disclosed in a recent Dow Jones interview that the SEC would consider changes to short-selling rules this fall: "It's expected that the commission will consider short selling reforms in the next few months." To combat such abuses, the SEC will look to increase borrowing requirements for some short sales and call for stronger enforcement including late charges or other financial penalties for short sellers who fail to cover short positions by the settlement date, noted Dow Jones.
Altomare continued, "Naked short selling is nothing more than economic terrorism. It hurts job creation by small emerging firms; small emerging firms are the engines for new jobs. It is a national scandal that has cost us, along with other small companies and their shareholders, hundreds of millions of dollars in dramatically reduced share prices. Once the stock price drops, the next step for most small public companies is to cut back and start laying off. That is where the economic terrorism unfolds. Up to now, the SEC has done little to stop this activity. The SEC has not prevented illegal short selling in the OTCBB market, where the newer smaller emerging firms find themselves. The SEC's complex regulations are focused on the more established companies, the more established capital markets. Maintaining a small public company under these conditions is costly and sometimes not worthwhile. The SEC should not condone this economic terrorism. It should move forward with meaningful changes. We encourage our shareholders to contact their Representatives in the House and Senate about this short selling abuse. Changes are needed. All of us in the smaller business community want to grow. We want and look forward to working with the SEC's new leadership to restore integrity to the OTCBB markets."
Universal Express said it had been asked by the Denver office of the SEC to "prove" short-selling exists, but the company provided no update on that dialogue, which its counsel earlier described as an attempt to squelch the company's right of free speech.
There are 119 public companies that have so far been touched by the growing national financial scandal.
Some thirteen on the list of 119, such as A.G. Edwards, Inc. (NYSE: AGE), Ameritrade Holding Corp. (NASDAQ: AMTD), Deutsche Bank AG (NYSE: DB), E*Trade Group, Inc. (NYSE: ET), FleetBoston (NYSE: FBF), Goldman, Sachs & Co. (NYSE: GS), Knight Securities, LP (NASDAQ: NITE), Ladenburg Thalmann & Co., Inc. (AMEX: LHS), M. H. Myerson & Co., Inc. (NASDAQ: MHMY), Olde / H&R Block (NYSE: HRB), Charles Schwab (NYSE: SCH), Toronto-Dominion's (NYSE: TD), TD Waterhouse Group and vFinance, Inc. (OTCBB: VFIN), have been accused by one or more public companies as allegedly participating in short selling activities or abuses, or of failing to settle trades.
Observers have said that trades to not settle because broker-dealers do not effect buy-ins, as required by law, and that there is an unspoken understanding that any brokerage that tries to force a buy-in will be retaliated against.
The remaining 106 companies have issued press releases or been named in the media as having been victimized, or as taking various actions, either alone or in concert with other companies, to oppose manipulative trading in the form of illegal naked short selling. The actions have ranged from lawsuits to withdrawals and threatened withdrawals from the electronic trading system managed by the Depository Trust & Clearing Corp., to withdrawals from toxic financings, to the issuance of dividends or name changes designed to squeeze manipulators, to joining associations or networks or to contacting regulatory authorities to provide documentation of abuses or otherwise complain.
On June 4, the SEC stated "the issues surrounding naked short selling are not germane to the manner in which DTC operates as a depository registered as a clearing agency. Decisions to engage in such transactions are made by parties other than DTC. DTC does not allow its participants to establish short positions resulting from their failure to deliver securities at settlement. While the Commission appreciates commenters' concerns about manipulative activity, those concerns must be addressed by other means."
Nevertheless, short positions do in fact exist due to failures of the electronic settlement system to balance their electronic books, and the SEC has provided shareholders and small companies with no inkling of what the Commission has in mind in "addressing" these concerns "by other means."
However, in mid-September the SEC admitted in a Dow Jones interview that "naked short selling" is a problem, and said its market regulatory division is taking aim at the practice. However, one public company reported that two days later a field office of the SEC asked the public company to "prove naked short selling exists," once more seemingly sending mixed signals to shareholders trapped in the manipulators' vise.
Recently the NASD revealed its plan to stop the practices that have ravaged these public companies and their shareholders - a wrist-slap to perpetrators such as Paragon Capital Markets, which was "censured" and fined $35,000 after the NASD said it had "executed short-sale orders in certain securities and failed to make an affirmative determination prior to executing such transactions." An even smaller fine was subsequently assessed against vFinance for similar allegations.
The complete list of those 106 companies include Advanced Viral Research Corp. (OTCBB: ADVR), AdZone Research, Inc. (OTCBB: ADZR), Amazon Natural Treasures (OTC: ANTD), America's Senior Financial Services (OTCBB: AMSE), American Ammunition, Inc. (OTCBB: AAMI), AngelCiti Entertainment (OTCBB: AGLC), ATSI Communications, Inc. (OTC: ATSC), Federal Agricultural Mortgage / Farmer Mac (NYSE: AGM) Allied Capital (NYSE: ALD), American Motorcycle (OTC: AMCYV), American International Industries (OTCBB: AMIN), Ameri-Dream (OTC: AMDR), Adirondack Pure Springs Mt. Water Co. (OTCBB: APSW), Bluebook International (OTCBB: BBIC), Blue Industries (OTCBB: BLIIV), Bentley Communications (OTCBB: BTLY), BIFS Technologies Corporation (OTCBB: BIFT), Biocurex (OTCBB: BOCX). Broadleaf Capital Partners, Inc. (OTCBB: BDLF), Chattem, Inc. (NASDAQ: CHTT), Critical Home Care (OTCBB: CCLH), Composite Holdings (OTC: COHIA), CyberDigital, Inc. (OTCBB: CYBD). Diamond International Group (OTCBB: DMND), Dobson Communications Corp. (NASDAQ: DCEL), Eagle Tech Communications (OTC: EATC), Edgetech Services (OTCBB: EDGH);
Also, Endovasc Ltd. (OTCBB: EVSC), Enviro-Energy Corporation (OTCBB: ENGY), Environmental Products & Technologies (OTC: EPTC), EPIXTAR Corp. (OTCBB: EPXR), eResearchTechnologies, Inc. (NASDAQ: ERES), Flight Safety Technologies (OTCBB: FLST), Freddie Mac (NYSE: FRE), FreeStar Technologies (OTCBB: FSRCE), Geotec Thermal Generators, Inc. (OTCBB: GETC), Genesis Intermedia (OTC: GENI), GeneMax Corp. (OTCBB: GMXX), Global Explorations Inc (OTC: GXXL), Global Path (OTCBB: GBPI), GloTech Industries, Inc. (OTCBB: GTHI), Green Dolphin Systems (OTCBB: GLDS), Group Management (OTCBB: GPMT), Hop-On (OTC: HPON), H-Quotient, Inc., (OTCBB: HQNT), Hyperdynamics Corp. (OTCBB: HYPD), International Biochem (OTCBB: IBCL), Intergold Corp. (OTCBB: IGCO), International Broadcasting Corporation (OTCBB: IBCS), InternetStudios, Inc. (OTCBB: ISTO), ITIS Holdings (OTCBB: ITHH), Investco Corp. (OTCBB: IVCO), Lair Holdings (OTC: LAIR), Lifeline BioTechnologies Inc. (OTC: LBTT), Life Energy & Technology (OTCBB: LETH), MBIA (NYSE: MBI);
Also, MegaMania Interactive (OTC: MNIA), MetaSource Group, Inc. (OTCBB: MTSR), Midastrade.com (OTC: MIDS), Make Your Move (OTCBB: MKMV), Medinah Minerals (OTC: MDMN), MSM Jewelry Corp. (OTC: MSMC), Nanopierce Technologies, Inc. (OTCBB: NPCT), Nutra Pharmaceutical (OTCBB: NPHC), Nutek (OTCBB: NUTK), Navigator Ventures (OTC: NVGV), Orbit E-Commerce, Inc. (OTCBB: OECI), Pitts & Spitts (OTC: PSPP), Sales OnLine Direct (OTCBB: PAID), Pacel Corp. (OTCBB: PACC), PayStar Corporation (OTC: PYST), Petrogen Corp. (OTCBB: PTGC), Pinnacle Business Management (OTC: PCBM), Premier Development & Investment, Inc. (OTCBB: PDVN), PrimeHoldings.com, Inc. (OTC: PRIM), Phlo Corporation (OTCBB: PHLC), Resourcing Solutions (OTC: RESG), Reed Holdings (OTC: RDHC), Rocky Mountain Energy Corp. (OTCBB: RMECE), RTIN Holdings (OTCBB: RTNHE), Saflink Corp. (NASDAQ: SFLK), Safe Travel Care (OTCBB: SFTVV), Sedona Corp. (OTCBB: SDNA);
Also, Sionix Corp. (OTCBB: SINX), Sonoran Energy (OTCBB: SNRN), Starmax Technologies (OTC: SMXIF), Storage Suites America (OTC: SSUA), Suncomm Technologies (OTC: STEH), Sports Resorts International (NASDAQ: SPRI), Technology Logistics (OTC: TLOS), Swiss Medica, Inc. (OTCBB: SWME), Ten Stix, Inc. (OTCBB: TNTI), Tidelands Oil (OTCBB: TIDE), Titan Construction (OTC: TTCS), Trezac Corp. (OTCBB: TRZAV), Universal Express, Inc. (OTCBB: USXP), Valesc Holdings, Inc. (OTCBB: VLSHV), Vega Atlantic (OTCBB: VGAC), Viragen (AMEX: VRA), Viragen International (OTCBB: VGNI), Vista Continental Corporation, (OTCBB: VICC), Viva International (OTCBB: VIVI), Vtex Energy (OTCBB: VXENE) and Wizzard Software (OTCBB: WIZD), WorldTradeShow.com (OTC: WTSW) and Y3K Secure Enterprise Software, Inc. (OTCBB: YTHK).
For up-to-the-minute news, features and links click on www.financialwire.net
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FinancialWire is an independent, proprietary news service of Investrend Information, a division of Investrend Communications, Inc. Additionally, Investrend provides a wide range of forums, independent research and webcasting platforms for shareholder empowerment. For more information or to receive the FirstAlert daily summary of news, commentary, research reports, webcasts, events and conference calls, click on www.investrend.com/contact.asp
URL: www.financialwire.net
(C) 2003 financialwire.net, Inc. All rights reserved.
-0-
Short Seller Skirmishes Break Out on Widening Battlefield
Oct 3, 2003 (financialwire.net via COMTEX) -- (FinancialWire) Jag Media Holdings (OTCBB: JGMHA), A.G. Edwards (NYSE: AGE), GloTech Industries (OTCBB: GTHI), and Universal Express (OTCBB: USXP) were all at the forefront of a series of skirmishes in the short seller wars Thursday.
United States District Judge Virginia Gilmore denied the efforts by A.G. Edwards and some 100 brokers to have the manipulative trading cases filed against them by Jag Media and CEO Gary Valinoti dismissed, but instructed the plaintiffs to return with an amended fact-filled pleading within 20 days.
Meanwhile, GloTech Industries, Inc. (OTCBB: GTHI) became the 119th public company touched by the growing national scandal involving illegal manipulative trading that has so far escaped substantive attention or regulation by NASD or the U.S. Securities and Exchange Commission.
GloTech said it has learned that some of the Company's shareholders are having difficulty obtaining certificates from certain brokerage firms.
"Based upon preliminary research and information obtained from the Depository Trust Company, the Company believes that certain brokerage firms may have been engaging in a practice known as 'naked short sales'. It is the Company's understanding that a 'naked short' is created when a brokerage firm sells shares that it has neither purchased nor borrowed with the intent of either a) later purchasing the shares at a lower price and only then delivering them to the buyer or b) never delivering the shares sold. An effect of sustained 'naked shorting' can be 'artificial' or 'manufactured' downward pressure on the stock being sold. "Further, the Company understands that this practice is considered 'manipulative' and illegal. The Company believes that up to three hundred thousand (300,000) shares, or approximately seventeen (17) times GloTech's average daily trading volume, may have been sold in this fashion."
GloTech said its legal counsel are actively "investigating this occurrence and reviewing appropriate legal action and other available remedies. GloTech intends to vigorously work to protect the integrity of the market for its stock and the interests of its shareholders."
GloTech said it has been advised that the only way to be absolutely certain that shares purchased through a brokerage account are validly issued, is to demand physical delivery of a stock certificate evidencing ownership of the total number of shares purchased. "Therefore, it said, "the Company strongly recommends that all shareholders contact their brokerage firms and request physical delivery of their stock certificates immediately. Failure of the brokerage firm to deliver a customer's stock certificates in a timely manner may be an indicator of 'naked short sales'. Shareholders are encouraged to file a complaint against such brokerage firms with the NASD. Complaints can be filed online at www.nasd.com .
GloTech said it has discovered a growing body of litigation and published articles which, combined with increasing public awareness of the problem, should ultimately lead to market reforms in this area.
Meanwhile, GloTech said it will reimburse any related transfer costs paid by GloTech shareholders during the next ninety (90) days.
Universal Express, Inc. (OTCBB: USXP) reminded the public that on September 23 it urged shareholders to contact their congresspersons in the U.S. House of Representatives and the U.S. Senate to request the Securities and Exchange Commission to put an immediate end to "naked short selling".
Universal Express describes "naked short selling" as the electronic churning downward of the shares of small developing OTCBB companies without actually trading the shares.
Richard A. Altomare, President & CEO of Universal Express noted, "When you never intend or fail to cover short sales, you are counterfeiting stock. Counterfeit stock added to a float drives prices down. This abuse of short selling by the broker dealers and the market makers who conspire with them devastates small emerging companies."
"In what appears to be the first admission by an SEC regulator that naked short selling is occurring, SEC market regulation division director Annette Nazareth disclosed in a recent Dow Jones interview that the SEC would consider changes to short-selling rules this fall: "It's expected that the commission will consider short selling reforms in the next few months." To combat such abuses, the SEC will look to increase borrowing requirements for some short sales and call for stronger enforcement including late charges or other financial penalties for short sellers who fail to cover short positions by the settlement date, noted Dow Jones.
Altomare continued, "Naked short selling is nothing more than economic terrorism. It hurts job creation by small emerging firms; small emerging firms are the engines for new jobs. It is a national scandal that has cost us, along with other small companies and their shareholders, hundreds of millions of dollars in dramatically reduced share prices. Once the stock price drops, the next step for most small public companies is to cut back and start laying off. That is where the economic terrorism unfolds. Up to now, the SEC has done little to stop this activity. The SEC has not prevented illegal short selling in the OTCBB market, where the newer smaller emerging firms find themselves. The SEC's complex regulations are focused on the more established companies, the more established capital markets. Maintaining a small public company under these conditions is costly and sometimes not worthwhile. The SEC should not condone this economic terrorism. It should move forward with meaningful changes. We encourage our shareholders to contact their Representatives in the House and Senate about this short selling abuse. Changes are needed. All of us in the smaller business community want to grow. We want and look forward to working with the SEC's new leadership to restore integrity to the OTCBB markets."
Universal Express said it had been asked by the Denver office of the SEC to "prove" short-selling exists, but the company provided no update on that dialogue, which its counsel earlier described as an attempt to squelch the company's right of free speech.
There are 119 public companies that have so far been touched by the growing national financial scandal.
Some thirteen on the list of 119, such as A.G. Edwards, Inc. (NYSE: AGE), Ameritrade Holding Corp. (NASDAQ: AMTD), Deutsche Bank AG (NYSE: DB), E*Trade Group, Inc. (NYSE: ET), FleetBoston (NYSE: FBF), Goldman, Sachs & Co. (NYSE: GS), Knight Securities, LP (NASDAQ: NITE), Ladenburg Thalmann & Co., Inc. (AMEX: LHS), M. H. Myerson & Co., Inc. (NASDAQ: MHMY), Olde / H&R Block (NYSE: HRB), Charles Schwab (NYSE: SCH), Toronto-Dominion's (NYSE: TD), TD Waterhouse Group and vFinance, Inc. (OTCBB: VFIN), have been accused by one or more public companies as allegedly participating in short selling activities or abuses, or of failing to settle trades.
Observers have said that trades to not settle because broker-dealers do not effect buy-ins, as required by law, and that there is an unspoken understanding that any brokerage that tries to force a buy-in will be retaliated against.
The remaining 106 companies have issued press releases or been named in the media as having been victimized, or as taking various actions, either alone or in concert with other companies, to oppose manipulative trading in the form of illegal naked short selling. The actions have ranged from lawsuits to withdrawals and threatened withdrawals from the electronic trading system managed by the Depository Trust & Clearing Corp., to withdrawals from toxic financings, to the issuance of dividends or name changes designed to squeeze manipulators, to joining associations or networks or to contacting regulatory authorities to provide documentation of abuses or otherwise complain.
On June 4, the SEC stated "the issues surrounding naked short selling are not germane to the manner in which DTC operates as a depository registered as a clearing agency. Decisions to engage in such transactions are made by parties other than DTC. DTC does not allow its participants to establish short positions resulting from their failure to deliver securities at settlement. While the Commission appreciates commenters' concerns about manipulative activity, those concerns must be addressed by other means."
Nevertheless, short positions do in fact exist due to failures of the electronic settlement system to balance their electronic books, and the SEC has provided shareholders and small companies with no inkling of what the Commission has in mind in "addressing" these concerns "by other means."
However, in mid-September the SEC admitted in a Dow Jones interview that "naked short selling" is a problem, and said its market regulatory division is taking aim at the practice. However, one public company reported that two days later a field office of the SEC asked the public company to "prove naked short selling exists," once more seemingly sending mixed signals to shareholders trapped in the manipulators' vise.
Recently the NASD revealed its plan to stop the practices that have ravaged these public companies and their shareholders - a wrist-slap to perpetrators such as Paragon Capital Markets, which was "censured" and fined $35,000 after the NASD said it had "executed short-sale orders in certain securities and failed to make an affirmative determination prior to executing such transactions." An even smaller fine was subsequently assessed against vFinance for similar allegations.
The complete list of those 106 companies include Advanced Viral Research Corp. (OTCBB: ADVR), AdZone Research, Inc. (OTCBB: ADZR), Amazon Natural Treasures (OTC: ANTD), America's Senior Financial Services (OTCBB: AMSE), American Ammunition, Inc. (OTCBB: AAMI), AngelCiti Entertainment (OTCBB: AGLC), ATSI Communications, Inc. (OTC: ATSC), Federal Agricultural Mortgage / Farmer Mac (NYSE: AGM) Allied Capital (NYSE: ALD), American Motorcycle (OTC: AMCYV), American International Industries (OTCBB: AMIN), Ameri-Dream (OTC: AMDR), Adirondack Pure Springs Mt. Water Co. (OTCBB: APSW), Bluebook International (OTCBB: BBIC), Blue Industries (OTCBB: BLIIV), Bentley Communications (OTCBB: BTLY), BIFS Technologies Corporation (OTCBB: BIFT), Biocurex (OTCBB: BOCX). Broadleaf Capital Partners, Inc. (OTCBB: BDLF), Chattem, Inc. (NASDAQ: CHTT), Critical Home Care (OTCBB: CCLH), Composite Holdings (OTC: COHIA), CyberDigital, Inc. (OTCBB: CYBD). Diamond International Group (OTCBB: DMND), Dobson Communications Corp. (NASDAQ: DCEL), Eagle Tech Communications (OTC: EATC), Edgetech Services (OTCBB: EDGH);
Also, Endovasc Ltd. (OTCBB: EVSC), Enviro-Energy Corporation (OTCBB: ENGY), Environmental Products & Technologies (OTC: EPTC), EPIXTAR Corp. (OTCBB: EPXR), eResearchTechnologies, Inc. (NASDAQ: ERES), Flight Safety Technologies (OTCBB: FLST), Freddie Mac (NYSE: FRE), FreeStar Technologies (OTCBB: FSRCE), Geotec Thermal Generators, Inc. (OTCBB: GETC), Genesis Intermedia (OTC: GENI), GeneMax Corp. (OTCBB: GMXX), Global Explorations Inc (OTC: GXXL), Global Path (OTCBB: GBPI), GloTech Industries, Inc. (OTCBB: GTHI), Green Dolphin Systems (OTCBB: GLDS), Group Management (OTCBB: GPMT), Hop-On (OTC: HPON), H-Quotient, Inc., (OTCBB: HQNT), Hyperdynamics Corp. (OTCBB: HYPD), International Biochem (OTCBB: IBCL), Intergold Corp. (OTCBB: IGCO), International Broadcasting Corporation (OTCBB: IBCS), InternetStudios, Inc. (OTCBB: ISTO), ITIS Holdings (OTCBB: ITHH), Investco Corp. (OTCBB: IVCO), Lair Holdings (OTC: LAIR), Lifeline BioTechnologies Inc. (OTC: LBTT), Life Energy & Technology (OTCBB: LETH), MBIA (NYSE: MBI);
Also, MegaMania Interactive (OTC: MNIA), MetaSource Group, Inc. (OTCBB: MTSR), Midastrade.com (OTC: MIDS), Make Your Move (OTCBB: MKMV), Medinah Minerals (OTC: MDMN), MSM Jewelry Corp. (OTC: MSMC), Nanopierce Technologies, Inc. (OTCBB: NPCT), Nutra Pharmaceutical (OTCBB: NPHC), Nutek (OTCBB: NUTK), Navigator Ventures (OTC: NVGV), Orbit E-Commerce, Inc. (OTCBB: OECI), Pitts & Spitts (OTC: PSPP), Sales OnLine Direct (OTCBB: PAID), Pacel Corp. (OTCBB: PACC), PayStar Corporation (OTC: PYST), Petrogen Corp. (OTCBB: PTGC), Pinnacle Business Management (OTC: PCBM), Premier Development & Investment, Inc. (OTCBB: PDVN), PrimeHoldings.com, Inc. (OTC: PRIM), Phlo Corporation (OTCBB: PHLC), Resourcing Solutions (OTC: RESG), Reed Holdings (OTC: RDHC), Rocky Mountain Energy Corp. (OTCBB: RMECE), RTIN Holdings (OTCBB: RTNHE), Saflink Corp. (NASDAQ: SFLK), Safe Travel Care (OTCBB: SFTVV), Sedona Corp. (OTCBB: SDNA);
Also, Sionix Corp. (OTCBB: SINX), Sonoran Energy (OTCBB: SNRN), Starmax Technologies (OTC: SMXIF), Storage Suites America (OTC: SSUA), Suncomm Technologies (OTC: STEH), Sports Resorts International (NASDAQ: SPRI), Technology Logistics (OTC: TLOS), Swiss Medica, Inc. (OTCBB: SWME), Ten Stix, Inc. (OTCBB: TNTI), Tidelands Oil (OTCBB: TIDE), Titan Construction (OTC: TTCS), Trezac Corp. (OTCBB: TRZAV), Universal Express, Inc. (OTCBB: USXP), Valesc Holdings, Inc. (OTCBB: VLSHV), Vega Atlantic (OTCBB: VGAC), Viragen (AMEX: VRA), Viragen International (OTCBB: VGNI), Vista Continental Corporation, (OTCBB: VICC), Viva International (OTCBB: VIVI), Vtex Energy (OTCBB: VXENE) and Wizzard Software (OTCBB: WIZD), WorldTradeShow.com (OTC: WTSW) and Y3K Secure Enterprise Software, Inc. (OTCBB: YTHK).
For up-to-the-minute news, features and links click on www.financialwire.net
For FinancialWire audio clips, click on partner ON24 at www.on24news.com
FinancialWire is an independent, proprietary news service of Investrend Information, a division of Investrend Communications, Inc. Additionally, Investrend provides a wide range of forums, independent research and webcasting platforms for shareholder empowerment. For more information or to receive the FirstAlert daily summary of news, commentary, research reports, webcasts, events and conference calls, click on www.investrend.com/contact.asp
URL: www.financialwire.net
(C) 2003 financialwire.net, Inc. All rights reserved.
-0-
Short Seller Skirmishes Break Out on Widening Battlefield
Oct 3, 2003 (financialwire.net via COMTEX) -- (FinancialWire) Jag Media Holdings (OTCBB: JGMHA), A.G. Edwards (NYSE: AGE), GloTech Industries (OTCBB: GTHI), and Universal Express (OTCBB: USXP) were all at the forefront of a series of skirmishes in the short seller wars Thursday.
United States District Judge Virginia Gilmore denied the efforts by A.G. Edwards and some 100 brokers to have the manipulative trading cases filed against them by Jag Media and CEO Gary Valinoti dismissed, but instructed the plaintiffs to return with an amended fact-filled pleading within 20 days.
Meanwhile, GloTech Industries, Inc. (OTCBB: GTHI) became the 119th public company touched by the growing national scandal involving illegal manipulative trading that has so far escaped substantive attention or regulation by NASD or the U.S. Securities and Exchange Commission.
GloTech said it has learned that some of the Company's shareholders are having difficulty obtaining certificates from certain brokerage firms.
"Based upon preliminary research and information obtained from the Depository Trust Company, the Company believes that certain brokerage firms may have been engaging in a practice known as 'naked short sales'. It is the Company's understanding that a 'naked short' is created when a brokerage firm sells shares that it has neither purchased nor borrowed with the intent of either a) later purchasing the shares at a lower price and only then delivering them to the buyer or b) never delivering the shares sold. An effect of sustained 'naked shorting' can be 'artificial' or 'manufactured' downward pressure on the stock being sold. "Further, the Company understands that this practice is considered 'manipulative' and illegal. The Company believes that up to three hundred thousand (300,000) shares, or approximately seventeen (17) times GloTech's average daily trading volume, may have been sold in this fashion."
GloTech said its legal counsel are actively "investigating this occurrence and reviewing appropriate legal action and other available remedies. GloTech intends to vigorously work to protect the integrity of the market for its stock and the interests of its shareholders."
GloTech said it has been advised that the only way to be absolutely certain that shares purchased through a brokerage account are validly issued, is to demand physical delivery of a stock certificate evidencing ownership of the total number of shares purchased. "Therefore, it said, "the Company strongly recommends that all shareholders contact their brokerage firms and request physical delivery of their stock certificates immediately. Failure of the brokerage firm to deliver a customer's stock certificates in a timely manner may be an indicator of 'naked short sales'. Shareholders are encouraged to file a complaint against such brokerage firms with the NASD. Complaints can be filed online at www.nasd.com .
GloTech said it has discovered a growing body of litigation and published articles which, combined with increasing public awareness of the problem, should ultimately lead to market reforms in this area.
Meanwhile, GloTech said it will reimburse any related transfer costs paid by GloTech shareholders during the next ninety (90) days.
Universal Express, Inc. (OTCBB: USXP) reminded the public that on September 23 it urged shareholders to contact their congresspersons in the U.S. House of Representatives and the U.S. Senate to request the Securities and Exchange Commission to put an immediate end to "naked short selling".
Universal Express describes "naked short selling" as the electronic churning downward of the shares of small developing OTCBB companies without actually trading the shares.
Richard A. Altomare, President & CEO of Universal Express noted, "When you never intend or fail to cover short sales, you are counterfeiting stock. Counterfeit stock added to a float drives prices down. This abuse of short selling by the broker dealers and the market makers who conspire with them devastates small emerging companies."
"In what appears to be the first admission by an SEC regulator that naked short selling is occurring, SEC market regulation division director Annette Nazareth disclosed in a recent Dow Jones interview that the SEC would consider changes to short-selling rules this fall: "It's expected that the commission will consider short selling reforms in the next few months." To combat such abuses, the SEC will look to increase borrowing requirements for some short sales and call for stronger enforcement including late charges or other financial penalties for short sellers who fail to cover short positions by the settlement date, noted Dow Jones.
Altomare continued, "Naked short selling is nothing more than economic terrorism. It hurts job creation by small emerging firms; small emerging firms are the engines for new jobs. It is a national scandal that has cost us, along with other small companies and their shareholders, hundreds of millions of dollars in dramatically reduced share prices. Once the stock price drops, the next step for most small public companies is to cut back and start laying off. That is where the economic terrorism unfolds. Up to now, the SEC has done little to stop this activity. The SEC has not prevented illegal short selling in the OTCBB market, where the newer smaller emerging firms find themselves. The SEC's complex regulations are focused on the more established companies, the more established capital markets. Maintaining a small public company under these conditions is costly and sometimes not worthwhile. The SEC should not condone this economic terrorism. It should move forward with meaningful changes. We encourage our shareholders to contact their Representatives in the House and Senate about this short selling abuse. Changes are needed. All of us in the smaller business community want to grow. We want and look forward to working with the SEC's new leadership to restore integrity to the OTCBB markets."
Universal Express said it had been asked by the Denver office of the SEC to "prove" short-selling exists, but the company provided no update on that dialogue, which its counsel earlier described as an attempt to squelch the company's right of free speech.
There are 119 public companies that have so far been touched by the growing national financial scandal.
Some thirteen on the list of 119, such as A.G. Edwards, Inc. (NYSE: AGE), Ameritrade Holding Corp. (NASDAQ: AMTD), Deutsche Bank AG (NYSE: DB), E*Trade Group, Inc. (NYSE: ET), FleetBoston (NYSE: FBF), Goldman, Sachs & Co. (NYSE: GS), Knight Securities, LP (NASDAQ: NITE), Ladenburg Thalmann & Co., Inc. (AMEX: LHS), M. H. Myerson & Co., Inc. (NASDAQ: MHMY), Olde / H&R Block (NYSE: HRB), Charles Schwab (NYSE: SCH), Toronto-Dominion's (NYSE: TD), TD Waterhouse Group and vFinance, Inc. (OTCBB: VFIN), have been accused by one or more public companies as allegedly participating in short selling activities or abuses, or of failing to settle trades.
Observers have said that trades to not settle because broker-dealers do not effect buy-ins, as required by law, and that there is an unspoken understanding that any brokerage that tries to force a buy-in will be retaliated against.
The remaining 106 companies have issued press releases or been named in the media as having been victimized, or as taking various actions, either alone or in concert with other companies, to oppose manipulative trading in the form of illegal naked short selling. The actions have ranged from lawsuits to withdrawals and threatened withdrawals from the electronic trading system managed by the Depository Trust & Clearing Corp., to withdrawals from toxic financings, to the issuance of dividends or name changes designed to squeeze manipulators, to joining associations or networks or to contacting regulatory authorities to provide documentation of abuses or otherwise complain.
On June 4, the SEC stated "the issues surrounding naked short selling are not germane to the manner in which DTC operates as a depository registered as a clearing agency. Decisions to engage in such transactions are made by parties other than DTC. DTC does not allow its participants to establish short positions resulting from their failure to deliver securities at settlement. While the Commission appreciates commenters' concerns about manipulative activity, those concerns must be addressed by other means."
Nevertheless, short positions do in fact exist due to failures of the electronic settlement system to balance their electronic books, and the SEC has provided shareholders and small companies with no inkling of what the Commission has in mind in "addressing" these concerns "by other means."
However, in mid-September the SEC admitted in a Dow Jones interview that "naked short selling" is a problem, and said its market regulatory division is taking aim at the practice. However, one public company reported that two days later a field office of the SEC asked the public company to "prove naked short selling exists," once more seemingly sending mixed signals to shareholders trapped in the manipulators' vise.
Recently the NASD revealed its plan to stop the practices that have ravaged these public companies and their shareholders - a wrist-slap to perpetrators such as Paragon Capital Markets, which was "censured" and fined $35,000 after the NASD said it had "executed short-sale orders in certain securities and failed to make an affirmative determination prior to executing such transactions." An even smaller fine was subsequently assessed against vFinance for similar allegations.
The complete list of those 106 companies include Advanced Viral Research Corp. (OTCBB: ADVR), AdZone Research, Inc. (OTCBB: ADZR), Amazon Natural Treasures (OTC: ANTD), America's Senior Financial Services (OTCBB: AMSE), American Ammunition, Inc. (OTCBB: AAMI), AngelCiti Entertainment (OTCBB: AGLC), ATSI Communications, Inc. (OTC: ATSC), Federal Agricultural Mortgage / Farmer Mac (NYSE: AGM) Allied Capital (NYSE: ALD), American Motorcycle (OTC: AMCYV), American International Industries (OTCBB: AMIN), Ameri-Dream (OTC: AMDR), Adirondack Pure Springs Mt. Water Co. (OTCBB: APSW), Bluebook International (OTCBB: BBIC), Blue Industries (OTCBB: BLIIV), Bentley Communications (OTCBB: BTLY), BIFS Technologies Corporation (OTCBB: BIFT), Biocurex (OTCBB: BOCX). Broadleaf Capital Partners, Inc. (OTCBB: BDLF), Chattem, Inc. (NASDAQ: CHTT), Critical Home Care (OTCBB: CCLH), Composite Holdings (OTC: COHIA), CyberDigital, Inc. (OTCBB: CYBD). Diamond International Group (OTCBB: DMND), Dobson Communications Corp. (NASDAQ: DCEL), Eagle Tech Communications (OTC: EATC), Edgetech Services (OTCBB: EDGH);
Also, Endovasc Ltd. (OTCBB: EVSC), Enviro-Energy Corporation (OTCBB: ENGY), Environmental Products & Technologies (OTC: EPTC), EPIXTAR Corp. (OTCBB: EPXR), eResearchTechnologies, Inc. (NASDAQ: ERES), Flight Safety Technologies (OTCBB: FLST), Freddie Mac (NYSE: FRE), FreeStar Technologies (OTCBB: FSRCE), Geotec Thermal Generators, Inc. (OTCBB: GETC), Genesis Intermedia (OTC: GENI), GeneMax Corp. (OTCBB: GMXX), Global Explorations Inc (OTC: GXXL), Global Path (OTCBB: GBPI), GloTech Industries, Inc. (OTCBB: GTHI), Green Dolphin Systems (OTCBB: GLDS), Group Management (OTCBB: GPMT), Hop-On (OTC: HPON), H-Quotient, Inc., (OTCBB: HQNT), Hyperdynamics Corp. (OTCBB: HYPD), International Biochem (OTCBB: IBCL), Intergold Corp. (OTCBB: IGCO), International Broadcasting Corporation (OTCBB: IBCS), InternetStudios, Inc. (OTCBB: ISTO), ITIS Holdings (OTCBB: ITHH), Investco Corp. (OTCBB: IVCO), Lair Holdings (OTC: LAIR), Lifeline BioTechnologies Inc. (OTC: LBTT), Life Energy & Technology (OTCBB: LETH), MBIA (NYSE: MBI);
Also, MegaMania Interactive (OTC: MNIA), MetaSource Group, Inc. (OTCBB: MTSR), Midastrade.com (OTC: MIDS), Make Your Move (OTCBB: MKMV), Medinah Minerals (OTC: MDMN), MSM Jewelry Corp. (OTC: MSMC), Nanopierce Technologies, Inc. (OTCBB: NPCT), Nutra Pharmaceutical (OTCBB: NPHC), Nutek (OTCBB: NUTK), Navigator Ventures (OTC: NVGV), Orbit E-Commerce, Inc. (OTCBB: OECI), Pitts & Spitts (OTC: PSPP), Sales OnLine Direct (OTCBB: PAID), Pacel Corp. (OTCBB: PACC), PayStar Corporation (OTC: PYST), Petrogen Corp. (OTCBB: PTGC), Pinnacle Business Management (OTC: PCBM), Premier Development & Investment, Inc. (OTCBB: PDVN), PrimeHoldings.com, Inc. (OTC: PRIM), Phlo Corporation (OTCBB: PHLC), Resourcing Solutions (OTC: RESG), Reed Holdings (OTC: RDHC), Rocky Mountain Energy Corp. (OTCBB: RMECE), RTIN Holdings (OTCBB: RTNHE), Saflink Corp. (NASDAQ: SFLK), Safe Travel Care (OTCBB: SFTVV), Sedona Corp. (OTCBB: SDNA);
Also, Sionix Corp. (OTCBB: SINX), Sonoran Energy (OTCBB: SNRN), Starmax Technologies (OTC: SMXIF), Storage Suites America (OTC: SSUA), Suncomm Technologies (OTC: STEH), Sports Resorts International (NASDAQ: SPRI), Technology Logistics (OTC: TLOS), Swiss Medica, Inc. (OTCBB: SWME), Ten Stix, Inc. (OTCBB: TNTI), Tidelands Oil (OTCBB: TIDE), Titan Construction (OTC: TTCS), Trezac Corp. (OTCBB: TRZAV), Universal Express, Inc. (OTCBB: USXP), Valesc Holdings, Inc. (OTCBB: VLSHV), Vega Atlantic (OTCBB: VGAC), Viragen (AMEX: VRA), Viragen International (OTCBB: VGNI), Vista Continental Corporation, (OTCBB: VICC), Viva International (OTCBB: VIVI), Vtex Energy (OTCBB: VXENE) and Wizzard Software (OTCBB: WIZD), WorldTradeShow.com (OTC: WTSW) and Y3K Secure Enterprise Software, Inc. (OTCBB: YTHK).
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Short Seller Skirmishes Break Out on Widening Battlefield
Oct 3, 2003 (financialwire.net via COMTEX) -- (FinancialWire) Jag Media Holdings (OTCBB: JGMHA), A.G. Edwards (NYSE: AGE), GloTech Industries (OTCBB: GTHI), and Universal Express (OTCBB: USXP) were all at the forefront of a series of skirmishes in the short seller wars Thursday.
United States District Judge Virginia Gilmore denied the efforts by A.G. Edwards and some 100 brokers to have the manipulative trading cases filed against them by Jag Media and CEO Gary Valinoti dismissed, but instructed the plaintiffs to return with an amended fact-filled pleading within 20 days.
Meanwhile, GloTech Industries, Inc. (OTCBB: GTHI) became the 119th public company touched by the growing national scandal involving illegal manipulative trading that has so far escaped substantive attention or regulation by NASD or the U.S. Securities and Exchange Commission.
GloTech said it has learned that some of the Company's shareholders are having difficulty obtaining certificates from certain brokerage firms.
"Based upon preliminary research and information obtained from the Depository Trust Company, the Company believes that certain brokerage firms may have been engaging in a practice known as 'naked short sales'. It is the Company's understanding that a 'naked short' is created when a brokerage firm sells shares that it has neither purchased nor borrowed with the intent of either a) later purchasing the shares at a lower price and only then delivering them to the buyer or b) never delivering the shares sold. An effect of sustained 'naked shorting' can be 'artificial' or 'manufactured' downward pressure on the stock being sold. "Further, the Company understands that this practice is considered 'manipulative' and illegal. The Company believes that up to three hundred thousand (300,000) shares, or approximately seventeen (17) times GloTech's average daily trading volume, may have been sold in this fashion."
GloTech said its legal counsel are actively "investigating this occurrence and reviewing appropriate legal action and other available remedies. GloTech intends to vigorously work to protect the integrity of the market for its stock and the interests of its shareholders."
GloTech said it has been advised that the only way to be absolutely certain that shares purchased through a brokerage account are validly issued, is to demand physical delivery of a stock certificate evidencing ownership of the total number of shares purchased. "Therefore, it said, "the Company strongly recommends that all shareholders contact their brokerage firms and request physical delivery of their stock certificates immediately. Failure of the brokerage firm to deliver a customer's stock certificates in a timely manner may be an indicator of 'naked short sales'. Shareholders are encouraged to file a complaint against such brokerage firms with the NASD. Complaints can be filed online at www.nasd.com .
GloTech said it has discovered a growing body of litigation and published articles which, combined with increasing public awareness of the problem, should ultimately lead to market reforms in this area.
Meanwhile, GloTech said it will reimburse any related transfer costs paid by GloTech shareholders during the next ninety (90) days.
Universal Express, Inc. (OTCBB: USXP) reminded the public that on September 23 it urged shareholders to contact their congresspersons in the U.S. House of Representatives and the U.S. Senate to request the Securities and Exchange Commission to put an immediate end to "naked short selling".
Universal Express describes "naked short selling" as the electronic churning downward of the shares of small developing OTCBB companies without actually trading the shares.
Richard A. Altomare, President & CEO of Universal Express noted, "When you never intend or fail to cover short sales, you are counterfeiting stock. Counterfeit stock added to a float drives prices down. This abuse of short selling by the broker dealers and the market makers who conspire with them devastates small emerging companies."
"In what appears to be the first admission by an SEC regulator that naked short selling is occurring, SEC market regulation division director Annette Nazareth disclosed in a recent Dow Jones interview that the SEC would consider changes to short-selling rules this fall: "It's expected that the commission will consider short selling reforms in the next few months." To combat such abuses, the SEC will look to increase borrowing requirements for some short sales and call for stronger enforcement including late charges or other financial penalties for short sellers who fail to cover short positions by the settlement date, noted Dow Jones.
Altomare continued, "Naked short selling is nothing more than economic terrorism. It hurts job creation by small emerging firms; small emerging firms are the engines for new jobs. It is a national scandal that has cost us, along with other small companies and their shareholders, hundreds of millions of dollars in dramatically reduced share prices. Once the stock price drops, the next step for most small public companies is to cut back and start laying off. That is where the economic terrorism unfolds. Up to now, the SEC has done little to stop this activity. The SEC has not prevented illegal short selling in the OTCBB market, where the newer smaller emerging firms find themselves. The SEC's complex regulations are focused on the more established companies, the more established capital markets. Maintaining a small public company under these conditions is costly and sometimes not worthwhile. The SEC should not condone this economic terrorism. It should move forward with meaningful changes. We encourage our shareholders to contact their Representatives in the House and Senate about this short selling abuse. Changes are needed. All of us in the smaller business community want to grow. We want and look forward to working with the SEC's new leadership to restore integrity to the OTCBB markets."
Universal Express said it had been asked by the Denver office of the SEC to "prove" short-selling exists, but the company provided no update on that dialogue, which its counsel earlier described as an attempt to squelch the company's right of free speech.
There are 119 public companies that have so far been touched by the growing national financial scandal.
Some thirteen on the list of 119, such as A.G. Edwards, Inc. (NYSE: AGE), Ameritrade Holding Corp. (NASDAQ: AMTD), Deutsche Bank AG (NYSE: DB), E*Trade Group, Inc. (NYSE: ET), FleetBoston (NYSE: FBF), Goldman, Sachs & Co. (NYSE: GS), Knight Securities, LP (NASDAQ: NITE), Ladenburg Thalmann & Co., Inc. (AMEX: LHS), M. H. Myerson & Co., Inc. (NASDAQ: MHMY), Olde / H&R Block (NYSE: HRB), Charles Schwab (NYSE: SCH), Toronto-Dominion's (NYSE: TD), TD Waterhouse Group and vFinance, Inc. (OTCBB: VFIN), have been accused by one or more public companies as allegedly participating in short selling activities or abuses, or of failing to settle trades.
Observers have said that trades to not settle because broker-dealers do not effect buy-ins, as required by law, and that there is an unspoken understanding that any brokerage that tries to force a buy-in will be retaliated against.
The remaining 106 companies have issued press releases or been named in the media as having been victimized, or as taking various actions, either alone or in concert with other companies, to oppose manipulative trading in the form of illegal naked short selling. The actions have ranged from lawsuits to withdrawals and threatened withdrawals from the electronic trading system managed by the Depository Trust & Clearing Corp., to withdrawals from toxic financings, to the issuance of dividends or name changes designed to squeeze manipulators, to joining associations or networks or to contacting regulatory authorities to provide documentation of abuses or otherwise complain.
On June 4, the SEC stated "the issues surrounding naked short selling are not germane to the manner in which DTC operates as a depository registered as a clearing agency. Decisions to engage in such transactions are made by parties other than DTC. DTC does not allow its participants to establish short positions resulting from their failure to deliver securities at settlement. While the Commission appreciates commenters' concerns about manipulative activity, those concerns must be addressed by other means."
Nevertheless, short positions do in fact exist due to failures of the electronic settlement system to balance their electronic books, and the SEC has provided shareholders and small companies with no inkling of what the Commission has in mind in "addressing" these concerns "by other means."
However, in mid-September the SEC admitted in a Dow Jones interview that "naked short selling" is a problem, and said its market regulatory division is taking aim at the practice. However, one public company reported that two days later a field office of the SEC asked the public company to "prove naked short selling exists," once more seemingly sending mixed signals to shareholders trapped in the manipulators' vise.
Recently the NASD revealed its plan to stop the practices that have ravaged these public companies and their shareholders - a wrist-slap to perpetrators such as Paragon Capital Markets, which was "censured" and fined $35,000 after the NASD said it had "executed short-sale orders in certain securities and failed to make an affirmative determination prior to executing such transactions." An even smaller fine was subsequently assessed against vFinance for similar allegations.
The complete list of those 106 companies include Advanced Viral Research Corp. (OTCBB: ADVR), AdZone Research, Inc. (OTCBB: ADZR), Amazon Natural Treasures (OTC: ANTD), America's Senior Financial Services (OTCBB: AMSE), American Ammunition, Inc. (OTCBB: AAMI), AngelCiti Entertainment (OTCBB: AGLC), ATSI Communications, Inc. (OTC: ATSC), Federal Agricultural Mortgage / Farmer Mac (NYSE: AGM) Allied Capital (NYSE: ALD), American Motorcycle (OTC: AMCYV), American International Industries (OTCBB: AMIN), Ameri-Dream (OTC: AMDR), Adirondack Pure Springs Mt. Water Co. (OTCBB: APSW), Bluebook International (OTCBB: BBIC), Blue Industries (OTCBB: BLIIV), Bentley Communications (OTCBB: BTLY), BIFS Technologies Corporation (OTCBB: BIFT), Biocurex (OTCBB: BOCX). Broadleaf Capital Partners, Inc. (OTCBB: BDLF), Chattem, Inc. (NASDAQ: CHTT), Critical Home Care (OTCBB: CCLH), Composite Holdings (OTC: COHIA), CyberDigital, Inc. (OTCBB: CYBD). Diamond International Group (OTCBB: DMND), Dobson Communications Corp. (NASDAQ: DCEL), Eagle Tech Communications (OTC: EATC), Edgetech Services (OTCBB: EDGH);
Also, Endovasc Ltd. (OTCBB: EVSC), Enviro-Energy Corporation (OTCBB: ENGY), Environmental Products & Technologies (OTC: EPTC), EPIXTAR Corp. (OTCBB: EPXR), eResearchTechnologies, Inc. (NASDAQ: ERES), Flight Safety Technologies (OTCBB: FLST), Freddie Mac (NYSE: FRE), FreeStar Technologies (OTCBB: FSRCE), Geotec Thermal Generators, Inc. (OTCBB: GETC), Genesis Intermedia (OTC: GENI), GeneMax Corp. (OTCBB: GMXX), Global Explorations Inc (OTC: GXXL), Global Path (OTCBB: GBPI), GloTech Industries, Inc. (OTCBB: GTHI), Green Dolphin Systems (OTCBB: GLDS), Group Management (OTCBB: GPMT), Hop-On (OTC: HPON), H-Quotient, Inc., (OTCBB: HQNT), Hyperdynamics Corp. (OTCBB: HYPD), International Biochem (OTCBB: IBCL), Intergold Corp. (OTCBB: IGCO), International Broadcasting Corporation (OTCBB: IBCS), InternetStudios, Inc. (OTCBB: ISTO), ITIS Holdings (OTCBB: ITHH), Investco Corp. (OTCBB: IVCO), Lair Holdings (OTC: LAIR), Lifeline BioTechnologies Inc. (OTC: LBTT), Life Energy & Technology (OTCBB: LETH), MBIA (NYSE: MBI);
Also, MegaMania Interactive (OTC: MNIA), MetaSource Group, Inc. (OTCBB: MTSR), Midastrade.com (OTC: MIDS), Make Your Move (OTCBB: MKMV), Medinah Minerals (OTC: MDMN), MSM Jewelry Corp. (OTC: MSMC), Nanopierce Technologies, Inc. (OTCBB: NPCT), Nutra Pharmaceutical (OTCBB: NPHC), Nutek (OTCBB: NUTK), Navigator Ventures (OTC: NVGV), Orbit E-Commerce, Inc. (OTCBB: OECI), Pitts & Spitts (OTC: PSPP), Sales OnLine Direct (OTCBB: PAID), Pacel Corp. (OTCBB: PACC), PayStar Corporation (OTC: PYST), Petrogen Corp. (OTCBB: PTGC), Pinnacle Business Management (OTC: PCBM), Premier Development & Investment, Inc. (OTCBB: PDVN), PrimeHoldings.com, Inc. (OTC: PRIM), Phlo Corporation (OTCBB: PHLC), Resourcing Solutions (OTC: RESG), Reed Holdings (OTC: RDHC), Rocky Mountain Energy Corp. (OTCBB: RMECE), RTIN Holdings (OTCBB: RTNHE), Saflink Corp. (NASDAQ: SFLK), Safe Travel Care (OTCBB: SFTVV), Sedona Corp. (OTCBB: SDNA);
Also, Sionix Corp. (OTCBB: SINX), Sonoran Energy (OTCBB: SNRN), Starmax Technologies (OTC: SMXIF), Storage Suites America (OTC: SSUA), Suncomm Technologies (OTC: STEH), Sports Resorts International (NASDAQ: SPRI), Technology Logistics (OTC: TLOS), Swiss Medica, Inc. (OTCBB: SWME), Ten Stix, Inc. (OTCBB: TNTI), Tidelands Oil (OTCBB: TIDE), Titan Construction (OTC: TTCS), Trezac Corp. (OTCBB: TRZAV), Universal Express, Inc. (OTCBB: USXP), Valesc Holdings, Inc. (OTCBB: VLSHV), Vega Atlantic (OTCBB: VGAC), Viragen (AMEX: VRA), Viragen International (OTCBB: VGNI), Vista Continental Corporation, (OTCBB: VICC), Viva International (OTCBB: VIVI), Vtex Energy (OTCBB: VXENE) and Wizzard Software (OTCBB: WIZD), WorldTradeShow.com (OTC: WTSW) and Y3K Secure Enterprise Software, Inc. (OTCBB: YTHK).
For up-to-the-minute news, features and links click on www.financialwire.net
For FinancialWire audio clips, click on partner ON24 at www.on24news.com
FinancialWire is an independent, proprietary news service of Investrend Information, a division of Investrend Communications, Inc. Additionally, Investrend provides a wide range of forums, independent research and webcasting platforms for shareholder empowerment. For more information or to receive the FirstAlert daily summary of news, commentary, research reports, webcasts, events and conference calls, click on www.investrend.com/contact.asp
URL: www.financialwire.net
(C) 2003 financialwire.net, Inc. All rights reserved.
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