Hartcourt Companies (fka HRCT)

[EZ2]

OT: This is a MUST READ for everyone !!!
PANIC AT THE DTC--A MUST READ FOR DNAP LONGS

medina minerals inc(mdmn)shareholders committee—posted by elrac—3april 01

As you probably have heard by now, the Transfer Agent of Medinah filed an “Adverse Claim” lawsuit against the DTC(depository trust corporation)
http://www.dtcc.com/ last week.

He had to do this because he was caught in a pickle between a company insisting on the names and shareholdings of all individual beneficial owners, and the DTC that didn’t want the world to know the shareholdings of the 6,000 shareholders that they were acting as custodian for.

Our contact at the DTC confirmed that on Monday 4/2/01, the DTC threw in the towel, and ordered the 124 brokerage firms that own Medina to contact the company headquarters and provide them with the name, address, and accurate shareholdings of each and every one of their shareholders that they hold shares for.

The ball is now in the court of the 124 brokerage firms.

The much sought after exchange of an omnibus certificate of 60 million shares of Medina Mining, for an omnibus certificate of 59 million shares of Medina Minerals, which would basically allow this house of cards the illegal short sellers have built to dodge another bullet, will not occur.

This committee has waited 4 long years for this to happen.

We can now communicate with all of the 7,100 shareholders of Medinah for the very first time, if the brokerage firms comply. We will have 100% visibility of the phantom shares, and the sellers thereof will be forced into the open market to buy these shares back on behalf of their rightful owners, who have been diligently seeking their delivery for months and months, but to no avail.

Our committee’s legal consultants inform us that this is an absolute first in the history of the DTC.

Wow! After 4 long years of death threats, market manipulation, being stalled and lied to by brokerage firms, being dragged through the mud by Internet bashers, being accused of lying, distorting the truth, etc. It’s really over.



Well how about that! The hundreds of examples of anecdotal as well as empirical evidence of the existence of a massive short position really weren’t fabricated after all.

Les really didn’t have anything to do with the death of Mother Teresa, and Greg didn’t cause the Holocaust. All of those censuses that dozens of people collectively put hundreds of hours into really did tell the truth.

So just how big is this legal victory, and what are its immediate consequences?

The best way to address this is to put your feet into the shoes of a market maker that has just shorted 50 million shares of Medinah over the last 4 years. Being a “bona fide” market maker he has been allowed to sell as many “phantom”(naked) shares of Medinah as he could get away with, and believe us when we tell you that there aren’t any cops on the beat.

All of those buy orders over the years that he sold phantom shares into now have to be placed under a microscope and accounted for, due to the recent litigation victory.

The 124 different brokerage firms that currently own Medinah have been ordered to go through their records and review how many of those purchases actually were followed up with good delivery.

Brokerage firms don’t worry at all about good delivery until situations like this arise. Things are so chaotic on Wall Street and the commissions are currently so cheap that it is cost prohibitive to follow up each of the billions of trades done by various firms to determine if good delivery has been made.

There are literally billions of IOU’s floating around in cyberspace that are rarely audited.

If some market maker failed good delivery, then there is plenty of time later to see which one did it, and how many shares he failed to deliver. The all-telling paper trail is always there.

Based on the presumption that half of our brokerage firms are “dirty” in regards to this illegal short selling campaign, and that half are “clean”, what we foresee happening in the next couple of days is that the 62 different “clean” houses will go through their trading records and determine how many shares they should have in their account at the DTC, based on 100% good delivery by the respective market makers, and compare this number to how many shares they in fact have in their account there.

The difference between these two numbers will then represent how many shares were not properly delivered by the market maker after their purchase.

The brokerage firm will then go into the open market, and buy that amount of shares under a guaranteed delivery notation, and promptly hand the bill to the various market makers guilty of not making good delivery.

The fun part is that the trading desk at the brokerage firm doesn’t particularly care how much he has to pay for the shares because he’s not going to pay the bill, besides it will be nice to get these pesky Medinah shareholders off of our backs bugging us for delivery of certificates. He does, however, have to buy real shares out of the back pocket of one of us with a registered cert there, which is a lot more expensive than just buying in the open market, and getting shares shorted to you. The broker then hands the recently purchased share cert to the shareholder who was demanding delivery of his cert. Brokers can no longer use the excuse of a “chill” or “freeze” at the DTC.


Thus the immediate effect at a “clean” brokerage firm pertains to dirty market makers that didn’t make good delivery being bought in via the open market. One has to remember that the only people that have a cert in their hands right now are the 70 or 80 million that have had their registered Medinah Mining certs processed by the Transfer Agent. How many of these want to get rid of these certs a couple of days before a big fat dividend is earned is the other side of the equation that must be evaluated. All 60 million shares available at the DTC will come from these “clean” brokerage firms.


Now what will happen to the “dirty” brokerage firms that knowingly filled all of those purchase orders over the last 4 years with phantom shares? They will have to approach the 1,500 or so of us that hold the “real” registered certs. Let’s say that the date by now is April 20 or so. The problem again arises as to who among them wants to sell their shares right before the big dividend day.

But to complicate matters, the State District Attorney’s office is now in high gear with a gun at the head of the “dirty” brokerage firms insisting that they hand a registered cert to the shareholder that filed charges within the next 72 hours.

To further complicate matters, the “dirty” brokerage firm doesn’t want to cross that May 1 dividend record date for that would increase his short position by another 20%. So basically, you have a situation from April 20-30, wherein a zillion shares are trying to be bought because of dividends, deadlines, pressure from District Attorneys, and the risk disappearing because of the recent litigation victory, at the same time that nobody wants to sell any shares.
What would really be scary to ponder is what would happen if the good guys put together a 50-100 million share buying campaign driven by all of these favorable overlapping circumstances. Just think of 50-100 million shares of buying all going after those dividends which would have to be covered by the short sellers, and paid to all buy orders that settled by and started the registration process by April the 30th.


What other sequel can we anticipate? Any shares loaned out by the DTC or the lending department of a brokerage firm, will of course, have to be surrendered, exposing some investors especially from offshore. All of those “desked” buy orders over the years that never did show up as trading volume on any given day, will of course be exposed. Any shares hypothecated against loans or towards net capital reserves of a broker/dealer will of course be pulled also. All of those bogus electronic transfers that were done will have to be negated, since all shares are being delivered to the home of the registered shareholder. Please remember also, DO NOT return your registered certs back to a broker until the day you want to sell some shares. Our second bogus cert showed up last Thursday. It was for 500,000 shares.

Our first one was for 870,000 shares. Our third one came in the form of a bogus convertible preferred share for a very, very, very large amount of shares. Be on the look out for dozens of other ones. Any share not mailed out from the Transfer Agent in Salt Lake City should be carefully scrutinized. Our auditing firm has informed management that they are filing litigation against those forces that spent two years doing everything in their power to thwart the successful completion of our financials. They are doing this independent of Medinah.
The 20% dividend process might bear further scrutiny. The beauty here is really threefold:1)The company itself doesn’t have to pay the dividend for a year, yet the shorters short the dividend have to pay it immediately upon demand. There aren’t many ways to cover Rule 144 shares if the company is not willing to help them. 2)Most commonly, the perpetrators of the “bear raid” are forced to cover the dividend immediately with free trading shares, thereby adding a little bonus to the shareholder. 3)The 20% dividend on the record date of May 1 also sets up a time barrier that the shorts don’t want to breach, for any short position not covered by May the 1st becomes 20% larger, because shorts are liable to cover any dividends awarded to a shareholder during the time he is short.4)This then puts the short sellers into the unenviable position of having to cover his short position in the April 20-30 time frame, when a ton of opportunists are also buying for the free dividend, which also just so happens to overlap with the timeframe when all of the shares are in a registered format, and in the back pocket of loyal shareholders who have no intention of selling and losing their free 20% dividend.
Thus we can dictate when the “bad guys” have to cover. Then if you accidentally throw in some pressure from the regulatory officials, the civil litigation, and the State District Attorneys, you come up with a severe supply and demand imbalance.


There is still the possibility that some brokerage firms will fall asleep at the wheel, and sleep right through the May 1 deadline. We must pre-suppose that all of the firms will do this and we must have the State District Attorneys ready to strike right around April the 10th. All of us with shares in the “pipeline” of registration must do this without exception. Also make sure your brokerage firm has undone all electronic transfers. Also don’t fall victim to a broker trying to convince you that you don’t need to take delivery of your registered cert.

This is the oldest trick in the book wherein a broker convinces you that all you need to do is to tell him when you want to sell, and he will credit your account with the proper amount of money in a mark to market fashion, based on where the market is trading on that day. What we want your broker to do, however, is to aggressively chase the market upwards while buying in your certs. Make him do this with the same fervor he showed while shorting you your shares in the first place.


The rock hounds on the committee seem to be awfully excited about the recent petrographic analyses. Apparently we are extremely close to the porphyry/pluton.
A hearty welcome to our fellow “shortees” over at PCBM.,

Best of luck on your project, we’ll be following your progress closely.


We’d like to thank all of the shareholders for their patience and persistence over the last four years, we firmly believe that your pain is now over. There is still a lot of work to do, however. Roll up your sleeves and sign up for one of the committee positions. If you bought shares from an offshore account, there is an extremely high likelihood that you will be presented with a counterfeit cert in the near term. Please call any irregularities to the attention of management. A hearty welcome also goes out to our newly discovered shareholders in Chile. Those of you that took part in the pooling of buy orders about 18 months ago, are probably aware by now that the order you folks put in for 10 million shares collectively was shorted to you in its entirety. We are currently working on your situation, and expect a very hasty remedy. So please hang in there for just a little while longer. One of our lawyers in Santiago will be meeting with you soon to explain this phenomenon of illegal shorting and why you have been unable to receive your certificates yet. Whatever you do, please, please, please don’t return your certificates back to the brokerage firm through which you placed the order. The attorney will explain why. Stay tuned…..

about medina minerals
http://quicken.excite.com/investments/news/story/bw/?story=/news/stories/bw/20010306/a2478.htm&s...