Foreign Collusion, Naked Shorting (Counterfeiting) & Money Laundering — All Illicit Wealth
The Banks That Ran Uber’s IPO Feared This Would Happen
Josh Barro
NY Mag, 17 May 2019
Matt Levine, among others, has been writing about the extraordinary measures that the investment banks running Uber’s initial public offering took, in vain, to stop the stock from tumbling in its first few days on the stock market.
As Morgan Stanley’s “Nuclear Option” Failed, Uber Stock Plunged
ZeroHedge, 14 May 2019
Uber’s underwriters, led by Morgan Stanley, were so (rightfully) worried that the company’s IPO was going to crater in the days after its public offering, they deployed what CNBC is calling “a nuclear option” and shorted IPO stock naked, even beyond the traditional greenshoe. Of course, anyone in the industry would simply call this “selling to the dumb money ahead of an obviously overpriced IPO,” but we digress.
This naked shorting is utilized as a tactic to “support the stock” in addition to the usual 15% greenshoe that underwriters overallocate just so they can cover into, if the stock is plunging, with hopes of stabilizing the drop (Morgan Stanley was also Uber’s very much ineffective stabilization agent). CNBC referred to the short covering as “a technique that goes above and beyond the traditional help a new offering can get.”
Uber underwriters worried about the IPO deployed unusual ‘naked short’ tactic to support the stock
Leslie Picker, Hugh Son
CNBC, 14 May 2019
Uber’s underwriters, led by Morgan Stanley, were so worried the company’s initial public offering had run into trouble, they deployed a nuclear option ahead of the deal last week, so they could provide extra support for the stock, four people with knowledge of the move said.
Thornton Mcenery
Dealbreaker, 14 May 2019
Uber’s appeal as a public company at this stage of its life has always been a mystery to us, yet even we are a little shocked that the bankers taking it to market were so sure it was priced to drop that they went through the trouble of building a naked short into the IPO and then sold that decision to investors as what we can only define as “Dipshit Insurance.”
Larry Smith
Smith On Stocks, 17 April 2019
I worked on Wall Street as an analyst for nearly 40 years and was involved in the stock market on a day to day basis. Throughout this time, I was focused on fundamental developments that would give an insight into the potential for a company to grow its sales and profits and then trying to translate that into future stock performance. Like many investors, I believed that this was the overarching factor in predicting future stock performance. I had no inkling and I would have been shocked if someone had told me ten years ago what the experience of the past decade has taught, i.e., in many, many cases (particularly for small companies) fundamentals are not the most important factor determining the stock price.
Larry Smith
Smith On Stocks, 11 April 2019
I am not going to attempt to show in any detail how the clearing, settlement and depositing of securities system evolved from the crisis of the mid-60s to what is now a totally paperless, electronic system. But briefly, Congress passed legislation in 1971 for two new service organizations, whose objectives were the speeding up the clearance and settlement process. The Depository Trust Company (DTC) was established as the nation’s principal securities depository, with the mission to convert paper certificates to electronic book entries and to immobilize the paper certificates and keep them in a vault at the DTC. (No more shuttling by messengers.) The National Securities Clearing Corporation (NSCC) was established at the same time to speed up clearance and settlement services.
Lyft is threatening litigation against Morgan Stanley, accusing the firm of supporting short-selling
Deirdre Bosa, Leslie Picker
CNBC, 6 April 2019
Lyft has threatened litigation against Morgan Stanley, accusing the firm of supporting short-selling for investors who are subject to lock-up agreements.
In a letter sent to Morgan Stanley on April 2, Lyft questioned the firm about its alleged role in helping market certain products that would help pre-IPO investors bet against the stock.
Wall Street Allows Giants Like Morgan Stanley Special Trading Hours
C. Edward Kelso
CoinSpice, 11 December 2018
“At the New York Stock Exchange, some traders are more equal than others,” Post reporter Kevin Dugan began. “That’s the bitter takeaway from stock brokers, who say the Big Board, in an unusual move last week, gave special treatment to a broker at Morgan Stanley who asked to trade large blocks of stocks for several minutes after the markets closed.”
Goldman Sachs hit with £5.2m fine for short selling
James Booth, 28 November 2018
South Korea’s financial regulator has hit Goldman Sachs with a 7.5bn won (£5.2m) fine for breaking rules on short-selling.
The fine is for short-selling without securing underlying assets, the Financial Services Commission (FSC) said in a statement. Continue reading “Article: Goldman Sachs hit with £5.2m fine for short selling”
Morgan Stanley & Co. LLC Fined by FINRA
October 18, 2018
An AWC was issued in which the firm was censured and fined a total of $56,000, of which $8,000 is payable to FINRA. Without admitting or denying the findings, the firm consented to the sanctions and to the entry of findings that it failed to take reasonable steps to establish that intermarket sweep orders (ISOs) it had routed met the definitional requirements set forth in the Securities Exchange Act of 1934 Rule 600(b)(30) of Regulation NMS primarily due to systems issues. The findings stated that as a result of the systems issues, the firm routed ISOs to multiple markets, which potentially traded through protected quotations in NMS stocks.
Brazil watchdog fines Morgan Stanley, Royal Bank of Canada for forex manipulation
Bruno Federowski, Richard Chang
Reuters, 13 June 2018
Brazil’s antitrust watchdog on Wednesday fined Morgan Stanley (MS.N) and Royal Bank of Canada (RY.TO) a total of 42.9 million reais ($11.6 million) for meddling with foreign exchange rates charged to clients.
The board of regulator Cade unanimously approved a proposal to fine Morgan Stanley 30.280 million reais and RBC 12.586 million reais.
CREDIT SUISSE INTERNATIONAL HAS MARKET MANIPULATION LAWSUIT AGAINST IT DISMISSED
MARIA NIKOLOVA, 26 March 2018
Credit Suisse International (CSI) has had the complaint against it dropped in a case targeting a number of primary dealers of US Treasuries. The order, filed earlier today with the New York Southern District Court, was signed by Judge Paul Gardephe on March 23, 2018.
The order stipulates that CSI is no longer a party in the market manipulation case captioned Breakwater Trading LLC et al v. Bank Of America Corporation et al (1:17-cv-06497). The plaintiffs have voluntarily dismissed all claims against CSI without prejudice to reassert such claims against CSI at a later time should evidence arise in discovery or otherwise that reveals information providing a basis for joining CSI on the claims being litigated in this case. Continue reading “Article: CREDIT SUISSE INTERNATIONAL HAS MARKET MANIPULATION LAWSUIT AGAINST IT DISMISSED”
Counterfeiting Stock
Anna McParland
The Creation of Counterfeit Shares — There are a variety of names that the securities industry has dreamed up that are euphemisms for counterfeit shares. Don’t be fooled : Unless the short seller has actually borrowed a real share from the account of a long investor, the short sale is counterfeit. It doesn’t matter what you call it and it may become non–counterfeit if a share is later borrowed, but until then, there are more shares in the system than the company has sold.
The magnitude of the counterfeiting is hundreds of millions of shares every day, and it may be in the billions. The real answer is locked within the prime brokers and the DTC. Incidentally, counterfeiting of securities is as
It is estimated that 1000 small companies have been put out of business by the shorts.
PDF (12 Pages): Paper Counterfeiting Stock
Top Wall Street Banks Accused of Conspiracy to Control Stock Lending Market Via Threatening Tactics and Boycotts
Cohen Milstein, 17 August 2017
Goldman Sachs, JP Morgan, UBS, Credit Suisse, Morgan Stanley and Bank of America Face Antitrust Allegations
NEW YORK—Several of the world’s largest investment banks have colluded, in violation of federal antitrust laws, to create and maintain exclusive control of the more than $1 trillion stock loan market, reaping massive profits at the expense of investors, according to three public employees’ pension funds which today filed a federal class action lawsuit. The suit alleges that since at least 2009, six of the world’s largest investment banks—Bank of America, Credit Suisse, Goldman Sachs, JP Morgan, Morgan Stanley and UBS—have illegally conspired to overcharge investors and maintain the power they hold over the stock loan market, obstructing multiple efforts to create competitive electronic exchanges that would benefit both stock lenders and borrowers. Continue reading “Article: Top Wall Street Banks Accused of Conspiracy to Control Stock Lending Market Via Threatening Tactics and Boycotts”
Morgan Stanley, 4 others settle forex-rigging case for $111.2M
Katherine Dela Cruz
S&P Global, 30 July 2017
Morgan Stanley, Standard Chartered Plc, Bank of Tokyo-Mitsubishi UFJ Ltd., Société Générale SA and RBC Capital Markets LLC agreed to pay a total of $111.2 million to settle a U.S. lawsuit accusing them of manipulating prices in the foreign exchange market, pending court approval.
The lawsuit was filed in 2014 against 12 companies, including Morgan Stanley, for allegedly conspiring to fix artificial prices on foreign exchange markets. In 2015, Standard Chartered, Bank of Tokyo-Mitsubishi, Société Générale and RBC Capital Markets were added as defendants in the case.
THE DOLLAR HAS NO INTRINSIC VALUE : DO YOUR ASSETS?
