Blackout Media Corp (BKMP)

[Daytrader1]

Investing 101 - May 2, 2005
- Pink Sheets CEO Calls for Reform in OTC Stock Market
by Mark Faulk
"I am writing to alert you of a very important rule change that is needed to improve the marketplace in your company's stock. I need your help to make regulators turn on the lights and protect investors from the menace of hidden short selling in the OTC market.

And I hope that, after reading this letter, you will take the time today -- or as soon as you can -- to contact the SEC and voice your support for this needed rule change."

So begins an open letter from R. Cromwell Coulson, Chairman and CEO of the Pink Sheets, in which he joins the fight against corruption in the stock market by calling for OTC companies and their shareholders to petition the SEC and NASD to change short selling disclosure rules to include OTC and pink sheet stocks. He has asked companies and investors to send an email or letter to the SEC and NASD and "voice your support to the SEC for the Pink Sheets' Request for Rulemaking Regarding Member Records of 'Short' Positions and Reporting and Public Dissemination."

In the letter, which was issued today, Coulson says, "As Chairman & CEO of the Pink Sheets, I know perhaps better than anyone the importance of improving the Pink Sheets and OTCBB trading. And I know the devastating impact that small companies face when their market is tarnished by the threat of manipulation.

There is a crisis facing the OTC market today in the lack of short sale position reporting and disclosure for OTC issues. This lack of transparency regarding short selling in the OTC market allows fraudulent acts to go undiscovered and manipulative short sellers to hide.

I believe regulators should fix the problem. Small issuers traded on the Pink Sheets and the OTCBB deserve the same transparency and regulatory oversight of short selling as those listed on Exchanges or NASDAQ."

According to Coulson, "Pink Sheets has petitioned the SEC to cause the amendment of NASD Rule 3360 and require NASD broker dealers to maintain a record of total "short" positions in all customer and proprietary firm accounts in all publicly traded equity securities as well as report this information to the NASD for public dissemination of the short positions by security. The SEC's action is urgently needed to prevent fraudulent acts, expose market manipulation, promote fair principles of trade and protect investors."

In an interview with The Faulking Truth today, Coulson said, "Naked short selling is a contentious debate, but I think that anyone on either side of the issue will agree that greater transparency will help alleviate the problem, and those who don't agree are involved in the fraudulent activities themselves. A lot of companies claim to be victims of naked short selling. By turning on the lights through greater transparency, we will very quickly figure out which are and which aren't. The little companies deserve the same protection and transparency as the larger companies. This is a taint that SEC regulators can easily fix through better disclosure."

In his letter, Coulson said that "The only way to succeed in achieving this rule change is through the public outcry of corporate officers and investors demanding the SEC make this needed improvement to the OTC markets, and there is no substitute for your personal voice in this debate. This important rule change is not going to happen if you remain silent.

So please, don't rely on others to get the job done. Write your Emails or letters today. Together, we must win this battle and convince the SEC not to treat the OTC secondary markets for small companies as second class citizens.

Without this rule change your company, your shareholders and securities regulators will be blind to any short selling activity in your stock. The SEC needs to know that the lack of short sale information in your securities is unacceptable and demand they change NASD Rule 3360 immediately."

The Pink Sheets is a centralized quotation service that helps facilitate trading in OTC Bulletin Board and Pink Sheet stocks for broker dealers and investors by providing a real time quote system for the 8,000 companies listed on the OTC BB and Pink Sheets. Although it is not officially affiliated with the NASD, the NASD gets a fee from broker members for each share that is traded, even shares that are sold short and never purchased on the open market, a practice which advocates calling for reform in the stock market say is the equivalent of stock counterfeiting.

Coulson has asked companies to write a letter or email to the SEC and NASD on their company letterhead in support of amending NASD Rule 3360 to include OTC BB and Pink Sheet stocks, and to "please ask others in your company to comment to the SEC, and Email a copy of this letter to your major shareholders, your investment banker, and your trade association. Urge them to get involved, too. Every voice counts in the debate, and yours could be the one that puts us over the top."


--------------------------------------------------------------------------------

You can read the Pink Sheets rule change request in it's entirety at: http://sec.gov/rules/petitions/petn4-500.pdf or http://sec.gov/rules/petitions.shtml

To voice your support to the SEC for the Pink Sheets' Request for Rulemaking Regarding Member Records of 'Short' Positions and Reporting and Public Dissemination (Request to amend NASD Rule 3360): [e-mail] with a Cc: copy to:
[e-mail]

Mail your comments to:

Jonathan G. Katz
Secretary, Securities Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549

With a copy to:

Barbara Z. Sweeney
Senior Vice President and Corporate Secretary, NASD
1735 K Street, NW
Washington DC 20006-1500

To comment to the SEC online, use [e-mail] with a Cc: copy to: [e-mail]

To learn more about Pink Sheets, go to: http://www.pinksheets.com/