Sarissa Resources Inc (SRSR)

[easymillion]

Downsideup ... "Instead of full transparency"
Unfortunately, you are 100% correct in your comments.
The following site provides a scenario of what startup companies face day in and day out, just a glimpse of what is especially prevalent in junior mining stocks and small biotech startups. I believe Scott Keevil knows what he is up against, and has the expert contacts, advice and "goods in the ground" to make Sarrissa a huge success despite the unlevel playing field. Thus, my previous post. Shareholders will be handsomely rewarded in the long run. We are only at the beginning. Only time will tell.
Easy
An excerpt from DeepCapture:
http://www.deepcapture.com/naked-short-selling-redefining-systemic-risk/
"Naked Short Selling - Redefining Systemic Risk"
Dr. Jim DeCosta says:
May 27, 2009 at 12:25 pm
istandup,

In regards to your question: “What happens if a long investor unknowingly sells his/her long shares which are only “security entitlements” BEFORE the FTD is cured?”

Assume that an NSCC participating clearing firm has 10 million Acme shares in its NSCC participant “shares account”. Let’s also assume that it sends out monthly statements “implying” that it is “holding long” 30 million shares of Acme for its clients. It is thus “naked short” 20 million shares.

If the phone rings and a client wants to sell his Acme purchases by default he will be determined to be one of the lucky ones that did get delivery of that which he purchased. That’s the beauty of “anonymous pooling” to cover up frauds. If there were a “run on the bank” scenario in which the purchasers of all 30 million Acme shares at that broker wanted to sell their shares simultaneously it still wouldn’t matter.

Since 90% of people hold their shares in “street name” because it’s so “handy” that broker could always borrow some from across the street and repay the borrowing later. The “fraternity brothers” at the DTCC take very good care of each other. I’ll post a blurb from book #9 in a second re: the tricky nature of “security entitlements”.

Reply
Dr. Jim DeCosta says:
May 27, 2009 at 12:30 pm
istandup, see if this from book #9 helps with the concept of “security entitlements”. It’s the first 11 points of 54.

KEY CONCEPTS IN REGARDS TO ABUSIVE NAKED SHORT SELLING (ANSS) FRAUDS

Dr. Jim DeCosta

1) The fraud known as abusive naked short selling (ANSS) went into high gear back when the DTC (Depository Trust Corporation) “volunteered” to act as the surrogate “legal owner” of all shares held in “street name” ostensibly to enhance the efficiency of the clearance and settlement process. Their nominee “Cede and Co.” became the “legal owner” or “owner of record” of all shares held in “street name” as referenced on the corporate transfer agent’s books.

2) This effectively blindfolded a corporation’s transfer agent from performing his “anti-counterfeiting policeman” role as “Cede and Co.” owned pretty much everything in sight and the TA was left with no visibility of the shenanigans going on behind the scenes at the secrecy-obsessed DTCC and their DTC and NSCC subdivisions.

3) Since the purchasers of shares were no longer the “legal owner” of that which they purchased they became relegated to being the mere “beneficial owners” of the securities purchased. “Cede and Co.” would “legally own” the shares for the benefit of (FBO) its “participating” clearing firm that in turn “owned” them FBO their client the investor. A “fiduciary” relationship was thus created between this surrogate “legal owner” and the “beneficial owner” that purchased the shares. Unfortunately for investors mere “beneficial owners” do not have the visibility of the behind the scenes actions at the NSCC like the “legal owners” enjoy. These “blindfolded” investors are forced to place their TRUST in the DTC to “act in good faith” and represent the interests of the purchasers of these shares while acting as a fiduciary in this surrogate “legal owner” capacity. History has now clearly shown us that neither the DTCC nor the DTC nor the NSCC nor many of their abusive “participating” market makers and clearing firms were up to this “acting in good faith” concept. The ability to re-route literally trillions of dollars of previously blindfolded investors’ money with very little risk of detection or meaningful penalties was just too tempting to pass up on.
4) The “beneficial owner” of securities was deemed by law to be what is referred to as a “security entitlement holder” as opposed to the “legal owner” of that which he purchased. What the investing public that hold their shares in “street name” often fail to comprehend is the tricky nature of legal “entitlements”.

5) The authors of UCC Article-8 wanted to send a “reminder” to the DTC “participants” and their nominee “Cede and Co.” that just because they were acting as the surrogate “legal owner” of all shares held in “street name” for efficiency purposes only they were never to LEVERAGE this form of public trust over the investors that they have the congressional mandate to protect. After all, it was the “security entitlement holders” that bought and paid for the shares (that may or may not have ever been delivered). As it turns out mere “security entitlement holders” have absolutely no clue as to whether or not that which they purchased ever did get delivered. The test begins; will abusive DTC participants try to LEVER the “legal owner” role and their superior view of the clearance and settlement system that the regulators and investing public entrusted them with?

6) UCC Article 8 made it clear that it was the investor clients of the various clearing firms making up the NSCC subdivision of the DTCC that were entitled “to exercise all of the rights and property interest that comprise the securities that they purchased” and not the NSCC participating clearing firms. The DTC promised that they would never think of LEVERAGING the fact that they were technically the “legal owner” of that which others purchased. Well, history seems to indicate otherwise as the “legal owner” of these securities ended up doing pretty much anything they wanted to with their “possession”.

7) UCC-8 clearly spelled out the various roles of the “legal owners” of securities versus those of the “security entitlement holders”. If the “entitlement holders” wanted to attain the “legal ownership” of that which they purchased all they had to do was to file an “entitlement order” demanding the delivery of the paper-certificated version of ownership (a share certificate) with their name inscribed on it. As the investors in corporations undergoing abusive naked short selling attacks will readily attest the DTCC often refuses to honor these “entitlement orders” in a timely fashion because to do so would often involve the NSCC management buying-in the delivery failures of their abusive bosses/participants. This process would drive share prices up and counter the share price depressant effect of “security entitlements” which those with massive preexisting naked short positions rely upon. The absolute refusal to execute buy-ins in order to service an “entitlement order” by the surrogate “legal owner” of shares obviously would be bordering on a criminal act. An unconflicted surrogate “legal owner” acting in a fiduciary capacity would obviously not facilitate the counterfeiting (via the NSCC’s SBP) of that which it has the mandate to “safeguard” and act as the “legal owner” of.
UCC Article-8-501 mandated that the clearing firms of investors that didn’t get delivery of the securities they purchased by “settlement date” (T+3) must nevertheless credit the investor’s account with “security entitlements”/IOUs/”long positions”/”phantom shares” representing the yet (if ever) to be delivered shares. Make a mental note as to the naïveté of this default assumption that ALL delivery failures on Wall Street involve securities that are about to arrive any second due to an unforeseeable but “legitimate” delay.

9) UCC Article -8 also mandated that the clearing firms holding these “security entitlements” treat their clients/”entitlement holders” as being entitled to exercise ALL of the rights and property interest that comprise the security even though they never got delivered and even though that which was sold may have never existed in the first place. OOPS!

10) Note the insanity here IF those shares sold whose delivery was theoretically “delayed” weren’t “delayed” at all but never existed in the first place and are not about to “arrive any second”. If that were to happen it’s too late because the purchaser of these “nonexistent” shares i.e. their “entitlement holder” already got permission to sell them as if they did arrive due to the wording used in 8-501.

11) Faulty presumptions about the imminence of delivery now allowed “counterfeit” shares to enter the system. The door was now wide open for securities fraudsters to take advantage of this “default assumption” regarding an imminent delivery and establish massive naked short positions by simply refusing to deliver the (nonexistent) securities they previously sold and thereby literally drown U.S. corporations with share price depressing “security entitlements” while claiming to be “injecting” much needed “liquidity”.