http://media.www.dailyutahchronicle.com/media/st...n.Bed.With.Wall.Street.Ceo.Says-3252089.shtml Russian Mafia in bed with Wall Street, CEO says By: Dan Treasure Issue date: 3/5/08 Section: News PrintEmail Article Tools Page 1 of 1 Media Credit: Aaron Schwendiman Patrick Byrne, the founder of Overstock.com, discusses the shady underpinnings of "naked short selling." Updated: 3/5/08 @ 11:58 a.m. Every day, thousands of Americans look to invest their money in stocks, and many of them go through brokers and traders to simplify the process. Unfortunately, according to Overstock.com CEO Patrick Byrne, a majority of those purchasers will be victims of Wall Street's criminal tactics and will help line the pockets of corrupt brokers and lawyers. Byrne, a Utahn who founded Overstock.com, talked to a crowd in the Union on Monday about how New York financial media and law firms have teamed up with big-wig business elites to create massive amounts of profit at the cost of American consumers. Byrne said when someone purchases a stock, there is a three-day stock settlement period during which a broker or a trader must provide a purchaser with that stock. However, through loopholes in the system, brokers and traders can legally not provide you with that stock almost indefinitely, giving the purchaser an IOU instead, Byrne said. "It's my thesis that certain people have figured out how they can abuse that loophole, and flood the market...often in connivance with a broker dealer," he said. Through this "flooding," the brokers can essentially issue the same stock to hundreds of people at no penalty. By increasing the supply of stocks, these dealers can dramatically drop the price according to the laws of supply and demand. Byrne showed how the "cheating parties" make money off of a stock price dropping through a process called "naked short selling." In brief, Byrne showed that "naked short selling" occurs when certain hedge funds and broker-dealers flood the market for a particular firm's stock with IOU's for that stock, cracking the market in it. If they ever have to make good on their IOU's it is at fraction of the original price, and they get to pocket the difference. These methods are used to create huge profits, often killing the victimized corporation in the process, and leaving the purchaser high and dry, Byrne said. In his efforts to stop this charade, Byrne filed a $3.5 billion lawsuit against Goldman Sachs, Morgan Stanley and nine other well-known brokers. Byrne said numerous publications, including the New York Post and Forbes magazine, have protested his "crusade," painting him as a crazed lunatic who is angry about Overstock.com's own stock price drop. Byrne said the Mafia has become a silent player in the Wall Street game. "You don't have to dig very far into this before you get to organized crime," he said. As an example of its involvement, Byrne told a story from a trip to the East Coast. "About 15 months ago I was invited by a stranger into a greasy bar in Long Island," he said. Claiming that he was Russian, the informant told him, "We have a message from Russia. We are about to kill you. We are about to kill if you if don't back down." Additionally, Byrne remarked on how writer Mark Mitchell was threatened in New York and told to stay away from "the Irish guy," which Byrne believes was himself. "I've been looking at this for two years, and I'm pretty much convinced this is the single biggest scandal in the history of American journalism," said Mitchell, a former financial writer for Time magazine. Byrne posted the presentation to his website, www.deepcapture.com, along with a blog to document his "crusade" against Wall Street.
I am going to look deeply into this. I look deeply into things once in a while, but when I do, I do it with gusto. I think my legal background will help me expeditiously research and assimilate relevant regulatory issues as promulgated by the SEC and other agencies having jurisdiction over such matters. I do not care about the 'other' issues surrounding overstock.com or its CEO. He is raising a very serious and potentially very legitimate issue, IMO.
appears to be so ... byrne's blog is absolutely wild... he has a lot of energy to write about the conspiracy. almost too much devotion ... its either a story worth telling of real corruption and nastiness, he is possibly a little obsessive/nuts, or the truth is somewhere between. his fixations on other journalists (gary weiss, wiki corruption, etc) is especially bizarre.
I wish you'd take a deep look into the Mafia's hit man Gasparino/CNBC which is by far a bigger deal than anything ever! This charlatan's abuse and scam must have cost the shorts and the longs together into hundreds of Billions while himself and his bosses must have benefited billions off of it? This was the biggest bank rubbery of the history ! Yet the guy gets more famous and praised for it too and keeps his job and walk the streets freely when should have been getting shafted in jail already.
I used to think Patrick Byrne was a completely crazy person. Now I believe he is only half crazy and the other half might have some valid points. I watched the presentation he put together awhile back and thought it raised some troubling questions. His blog is definitely entertaining.