Posted on

Web: Remember How Naked Short Selling Wasn’t a Big Deal?

Web

Remember How Naked Short Selling Wasn’t a Big Deal?

Bob O’Brien

Sanity Check via Wayback, 28 January 2009

Bernie Madoff’s brokerage owed $600 million in stock to its clients, that it, well, didn’t actually have on hand, as in the shares were either never delivered to the brokerage, or far more likely, it just, “Desked the trades” – meaning that it took the client cash, represented the securities as having been bought in the market and delivered (via the brokerage statement the client got every month), but never bothered with buying the shares.

Also known as one type of naked short selling.

Access archived page.

Posted on

Article: Strange Occurrences, and a Story about Naked Short Selling

Article - Media

Strange Occurrences, and a Story about Naked Short Selling

27 January 2009

Mark Mitchell

DeepCapture, 27 January 2009

Evidence suggests that Bernard Madoff, the “prominent” Wall Street operator and former chairman of the NASDAQ stock market, had ties to the Russian Mafia, Moscow-based oligarchs, and the Genovese organized crime family.

And, as reported by Deep Capture and Reuters, Madoff did not just orchestrate a $50 billion Ponzi scheme. He was also the principal architect of SEC rules that made it easier for “naked” short sellers to manufacture phantom stock and destroy public companies – a factor in the near total collapse of the American financial system.

Read full article.

Posted on

Web: Merrill Pays $15 Billion in Compensation After Taking $10 Billion in TARP Funds

Web

Merrill Pays $15 Billion in Compensation After Taking $10 Billion in TARP Funds

Bob O’Brien

Sanity Check via Wayback, 23 January 2009

After all, the logic, or rather the gun to the head of the taxpayer by Hank Paulson, was that the economy would vaporize if we didn’t take taxpayer money and give it to Wall Street banks and insurance companies, to, er, lend, or to relieve them of the burden of having to carry the toxic paper they created on their books any longer.

At the time, I said that was clearly a lie, and all this would be is a redistribution from the Treasury, to the Wall Street buddies of Paulson’s who got us into the mess in the first place.

Access archived page.

Posted on

Article: Bernard Madoff, the Mafia, and Naked Short Selling

Article - Media

Bernard Madoff, the Mafia, and Naked Short Selling

Mark Mitchell

DeepCapture, 19 January 2009

Bernard L. Madoff was once the chairman of the NASDAQ stock exchange. He was one of the most important market makers on Wall Street. And he managed what was, by some estimates, the largest hedge fund on the planet.

Yes, Bernard Madoff was an impressive man. That much was clear even before we learned that his $50 billion Ponzi scheme may have been orchestrated in cahoots with the most powerful, sophisticated, and indiscriminately murderous organized crime syndicate the world has ever known.

Read full article.

Posted on

Article: Geithner – Treasury Nominee Failed to Halt Bond Scam

Article - Media

Geithner – Treasury Nominee Failed to Halt Bond Scam

Lucy Komisar

The Komisar Scoop, 19 January 2009

U.S. Senators at Timothy Geithner’s confirmation hearing for Treasury Secretary Wednesday may want to ask him about a failure to act that is costing the U.S. a lot more than the amount he evaded on taxes.

The Federal Reserve Bank of New York, which he has led since 2003, conducts the operations on Wall Street of the Federal Reserve in Washington, the country’s central bank.

Read full article.

Posted on

Web: Goldman Sachs and Madoff – Mr. Paulson Shocked To Learn There’s Gambling Going On In There!!!

Web

Goldman Sachs and Madoff – Mr. Paulson Shocked To Learn There’s Gambling Going On In There!!!

Bob O’Brien

Sanity Check via Wayback, 11 January 2009

Apparently, Goldman knew that Madoff was a fraud almost a decade ago. As this article in the Telegraph points out, there was a company-wide ban against doing anything with his firm after they did diligence on him:
“More than a decade ago bankers from Goldman Sachs’ asset management division were despatched to Bernard Madoff Investment Securities to discover how the legendary fund manager maintained such consistently good returns.

The American banking giant prided itself on managing funds in-house but if it could get a better deal for its clients at Madoff, Goldman would gracefully admit it and allocate some funds.

One former Goldman partner said: “I remember the guys came back baffled. Madoff refused to let them do any due diligence on the funds and when they asked about the firm’s investment strategy they couldn’t understand it. Goldman not only black-listed Madoff in the asset management division but banned the brokering side from trading with the firm too.”

Access archived page.

 

Posted on

Web: Will the Justice Department and the SEC Go After Blatantly Illegal RICO Activity by the Nation’s Most Prominent Hedge Funds?

Web

Will the Justice Department and the SEC Go After Blatantly Illegal RICO Activity by the Nation’s Most Prominent Hedge Funds?

Bob O’Brien

Sanity Check via Wayback, 3 January 2009

Apparently hedge funds like Kynikos, and SAC, have a secret for their outsize performance.

Racketeering, and illegal frontrunning, if my read is correct.

That’s the only conclusion one can draw from the stunningly simple and obvious analysis of email records that Judd Bagley, over at the Deepcapture site, has compiled.

You have Jim Chanos, who is all over the airwaves as the advocate and public face of the hedge fund world, who argues against any and all regulation or oversight for hedge funds or short sellers, apparently actively frontrunning information illegally obtained from stock analysts, who eagerly shared their analysis and spreadsheets with him in advance of publishing negative smear pieces subsequently shown by time to have been nothing more than hatchet jobs.

Access archived article.

Posted on

Article: Gary Weiss, Psychopath & Scaramouch

Article - Academic

Gary Weiss, Psychopath & Scaramouch

Patrick Byrne

Portfolio Magazine cited by DeepCapture, 31 December 2008

For over 10 years Gary Weiss (once a reporter with BusinessWeek, and recently, a columnist with Forbes) has been posting under fake names to confuse, distort, and hijack Usenet groups, stock message boards, and Wikipedia, using social media to prevent the public from understanding criminal activity.

I now turn to Gary Weiss. Last year one of the most prominent journalists on Wall Street warned me, “I’ve known Weiss for years. Be careful. He’s a psychopath.” As you will see, he was neither joking nor exaggerating. I think, however, that Gary is better described as a “Scaramouch.”

Read full article.

Posted on

Article: The Brualdi Law Firm, P.C. Announces Class Action Lawsuit Against AtriCure, Inc.

Article - Media, Publications

The Brualdi Law Firm, P.C. Announces Class Action Lawsuit Against AtriCure, Inc.

The Brualdi Law Firm, 19 December 2008

NEW YORK, Dec. 19, 2008 (GLOBE NEWSWIRE) — The Brualdi Law Firm, P.C. announces that a lawsuit has been commenced in the United States District Court for the Southern District of Ohio on behalf of purchasers of AtriCure, Inc. (“AtriCure” or the “Company”) (Nasdaq:ATRC) securities during the period between May 10, 2007 and October 31, 2008 (the “Class Period”) for violations of the federal securities laws.

No class has yet been certified in the above action. Until a class is certified, you are not represented by counsel unless you retain one. If you purchased AtriCure common stock during the Class Period, and wish to move the court for appointment of lead plaintiff, you must do so by February 10, 2009. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. The lead plaintiff will be selected from among applicants claiming the largest loss from investment in the Company during the Class Period. You do not need to seek appointment as a lead plaintiff in order to share in any recovery.
Continue reading “Article: The Brualdi Law Firm, P.C. Announces Class Action Lawsuit Against AtriCure, Inc.”

Posted on

Web: SEC Allows Deci-Billion Dollar Ponzi Scheme to Run For Years

Web

SEC Allows Deci-Billion Dollar Ponzi Scheme to Run For Years

Bob O’Brien

Sanity Check via Wayback, 16  December 2008

So, you have these cops, see? They patrol the neighborhood where all the cocaine gets sold, and yet for all their hard work, the coke problem spirals out of control. Many, when they choose to leave the force, get massive pay increases by going to work for some of the private security firms long linked to the coke dealers. They will occasionally bust small time dealers, or new entrants into the market, however the very visible kingpins in the neighborhood, who drive Bentleys and have their own planes, never get looked at. In fact, should anyone suggest that a Colombian with a 4th grade education not be a legitimate multi-million dollar business owner, they will get investigated. The town’s awash with coke and coke profits, but according to the cops, nobody knows where it all comes from, who is trafficking in it, or anyone that’s dirty. Everyone is mystified by the coke deluge.

Access archived page.

Posted on

Article: The DTCC’s CNS naked short selling residue

Article - Media

The DTCC’s CNS naked short selling residue

Patrick Byrne

DeepCapture, 1 December 2008

In a previous post I named various places where unsettled trades can accumulate: in the desks of brokers, in pre-netting among brokers, in the Continuous Net Settlement (CNS) system, in the Stock Borrow Program (SBP), through ex-clearing, and in delivery mechanisms from offshore exchanges. For all I know, these represent just a subset of the cracks in the system. The great unanswered question is, How much financial toxic waste has naked short selling and its various equivalents left scattered throughout these cracks?

The answer is: I don’t know, and I think no one knows. I suspect no one agent has the full picture of what is going on across all of these cracks. In fact, I suspect some of these cracks are so obscure no one has a clear picture of what is going on in them individually, let alone collectively.

Read full article.

Posted on

Article: Goldman Targeted by Investor Complaints of Naked Short-Selling

Article - Media

Goldman Targeted by Investor Complaints of Naked Short-Selling

Pierre Paulden, Caroline  Salas

Bloomberg, 17 November 2008

Investors in the $591 billion high-yield, high-risk loan market are accusing Goldman Sachs Group Inc. of naked short selling to profit from record price declines.

At least two fund managers complained verbally to officials of the Loan Syndications and Trading Association, saying they believe Goldman helped drive down prices by using the technique, according to people with knowledge of the objections. New York- based Goldman is acting against its clients by trying to profit at their expense, the investors said.

Read full article.

Posted on

Article: Naked Shorting Under Scrutiny

Article - Media

Naked Shorting Under Scrutiny

Traders Magazine, 11 November 2008

Regulators are clamping down on broker-dealers that violate naked short-sale rules. Both New York Stock Exchange Regulation and the Financial Industry Regulatory Authority are making it a point to closely scrutinize brokers’ stock-loan practices. If they find brokers are not complying with rules targeting failures to deliver, they are penalizing them.

Read full article.

Posted on

Article: Fed Defies Transparency Aim in Refusal to Disclose

Article - Media

Fed Defies Transparency Aim in Refusal to Disclose

Mark Pittman, Bob  Ivry, Alison Fitzgerald

Bloomberg cited by Yonkers Tribune

The Federal Reserve is refusing to identify the recipients of almost $2 trillion of emergency loans from American taxpayers or the troubled assets the central bank is accepting as collateral.

Fed Chairman Ben S. Bernanke and Treasury Secretary Henry Paulson said in September they would comply with congressional demands for transparency in a $700 billion bailout of the banking system. Two months later, as the Fed lends far more than that in separate rescue programs that didn’t require approval by Congress, Americans have no idea where their money is going or what securities the banks are pledging in return.

Read full article.