My impression from what I have read is basically the SEC is full of lawyers not traders. These lawyers are not ambulance chasers. They aren't out on the street looking for business or bad trades. As a layman, you can assume some law was broken and report it to the SEC but you must follow procedural law to prove it. The difficult part is you are a trader not a lawyer and you are dealing with a lawyer who is not a trader. (You haven't a chance in hell if you are in a room full of lawyers and you must explain what a short sale is because they have never heard of it). It is also my understanding that you must present your "case" to the DA and he brings the charges and files them with the SEC. As far as the comments on "wrist slap" of fines. If Fed and state taxes etc have been paid on the transaction profits this speaks volumes of whether the defendants thought they were doing something illegal. If you rob a bank, are you going to pay income tax on the money you stole?
Right......... and wrong. many instances of us going to them and having to explain things like a they didn't even know what a stock was. It's the upper guys who block everything. You can't fine GS 2mm for three years of naked shorting. That's a cost of doing business to them. Now, look where we are. Everything is destroyed, and the tab for naked shorting has to be paid. And it will come due here in a very short period of time I understand. The biggest hedgies in the country read this stuff. They sure know more than me, and they know exactly what I'm talking about. They know everything. They have all the money. We have the money trail. You guys are in for some real shocks coming up. and when it breaks, I owe Baron a big thanks. It was the OSTK CEO thread where I first put the Byrne Jihad stuff. Go back and read it. Since that time, Overstock has discovery. Oh, they didn't want that to happen. For such a wacko, Patrick was the first CEO to get by PSLRA. Pret tee Kraftee, if I do say so myself. Lots of stuff I can't say. But I can tell you, the new SEC IG is investigating how the SEC investigated naked shorting. That is public. And I can tell you, "not very well'. Remind me to tell ou about the "9c trade" . I wrote that one up for the IG. Good night, Gracie.
For those of you interested in this most important topic, I found gary aguirre's letter to congress. As a warmup: Aguirre was a 66 year old attorney, wealthy enought to retire, who went back to school so he could become a securities attorney. He was widely villified at the time by the like s of Gasparino, Judy Burns of the WSJ, and many other media members as a crackpot. On Dec 6, 2006, he appeared in front of the Judiciary Committee. The next day, the only IG the SEC ever had resigned, and Specter basically accused the higher ups he had subpoenaed of perjury. This hearing was a trememdous insight to the inner workings of hedge funds and the powerful. You can say, "well, nothing happened." I'll tell you, 'day ain't over,yet." http://www.faulkingtruth.com/Files/aguirre_congress0623.pdf
The SEC cannot do any better than scapeggoating a few unfortunates after any alleged catastrophy. If you try to get any sense from them beforehand as to the parameters you should use, they won't take responsibility. They are the epitome of human weakness in that will bite and scratch you and send you to jail 'after' some alleged problem but cannot step in 'before' to guide you safely through. To justify their existence they have to be continually finding or 'inventing' scapegoats 'afterwards'. The role of the SEC is to provide a circus to satisfy political and public perceptions.
Excellent Commentary, Cheese ...................................................................... Cheese wrote.... The role of the SEC is to provide a circus to satisfy political and public perceptions. .............................................................................................. Perfectly stated.... .............................................................................................. The cost of non interest non obligatory debt created in the US is getting too expensive.... The computer banks are going elswhere... The SEC, Congress, and the Corporate Fraternity incestual game is coming to a close..... The Police are paid off by switching jobs back and forth from SEC to Corporate.....the list goes on.... Good riddance.....FO
I have read alot of BS on this site. But this is a new low in self denial. Blaming the SEC for your bad trade? Get a grip man.
STOCKGATE TODAY Cannibalism on Wall Street â June 26, 2008 David Patch There is no mercy on Wall Street when traders and savvy investors are provided opportunity to eat their own. With subprime write-downâs becoming the new quarterly event it didnât take a rocket scientist to figure out that the financial sector was going to take a hit. How big a hit however would be up to those who trade these markets with regularity. Quarterly trade settlement data now available on the SEC website illustrates clearly the correlation between a trade settlement failure and a market collapse. Unlike prior data that revealed a more manageable problem when it came to the financial sector, since it was the financial sector responsible for trade settlement, this new data reveals how predatory the industry can become even to one of their own. Consider, for example Bear Stearns. Bear Stearns was under a very public attack by short sellers and market pundits over subprime liabilities. Soon rumors circulated about their demise and the ensuing run on the bank made those rumors come to fruition. Question is which came first, the run on the bank by legitimate investors holding stock in Bear Stearns or by Investors who sold down the stock on shares that could not be accounted for to settle. And if the latter was the initiation of a bear raid the financial services members who executed such trades would be responsible for the destruction of on of their own. Taking into consideration the reporting structure of the CNS Fails data, fails are reported on Trade + 3 days as a fail if such trade does not close out on time. Thus, for a trade executed on Wednesday March 12, 2008 a fail would be reported on Monday March 17, 2008. Similarly a trade executed into a failure on Monday March 17, 2008 would show up as a failure on Friday March 20, 2008. Date CNS Reported Fails Closing Price Bear Stearns BSC 3/10/2008 36,297 $62.30 Bear Stearns BSC 3/11/2008 149,700 $62.97 Bear Stearns BSC 3/12/2008 135,647 $61.58 Trade Executed Bear Stearns BSC 3/13/2008 19,424 $57.00 T+1 Bear Stearns BSC 3/14/2008 201,768 $30.00 T+2 Bear Stearns BSC 3/17/2008 1,247,876 $4.81 T+3 (CNS Fail) Trade Executed Bear Stearns BSC 3/18/2008 749,837 $5.91 T+1 Bear Stearns BSC 3/19/2008 2,120,638 $5.33 T+2 Bear Stearns BSC 3/20/2008 13,789,126 $5.96 T+3 (CNS Fail) Bear Stearns BSC 3/24/2008 12,588,395 $11.25 Bear Stearns BSC 3/25/2008 11,736,910 $10.94 Bear Stearns BSC 3/26/2008 7,673,413 $11.21 Bear Stearns BSC 3/27/2008 9,340,963 $11.23 Bear Stearns BSC 3/28/2008 12,396,655 $10.78 Bear Stearns BSC 3/31/2008 4,677,810 $10.49 Clearly, evidence reveals a significant premonition that Bear Stearns was about to take a nose dive as more than $64 Million worth of Bear Stearns shares were sold into net settlement failure on March 12, 2008 as the failures increased 6-fold from 200K to 1.2 Million. The pattern continues during the markets decline leading into Monday March 17, 2008 where the fails again accumulated 7-fold from 2 Million to near 14 Million while the market collapsed from $30.00 to a closing price of $4.81. Regulators will tell you that settlement failures are a necessity to the market place because each represents liquidity. But why a market experiencing a near death free fall would need sell side liquidity is unknown. In fact, based on the guidelines of Regulation SHO, none of this is considered abusive. These are the lead in fails that take place prior to the critical threshold level required to meet SHO threshold guidelines. These fails are also exempt from SEC action based on many being fails attributed to Options Market trading whereby the short seller rents out the options market maker exemption to naked short (sell without delivery) the equity market. Unfortunately the market participants are far superior in intelligence when compared to the Securities and Exchange Commission meaning that the manner in which these excessive fails were executed into the marketplace will never be truly understood. The piling on of the sell side market in Bear Stearns was calculated and done to create profit at the expense of valued shareholders. These fails represent sellers who had otherwise not been in this market but wished to enter in at a time of fragility for existing shareholders. The fact that Wall Street and securities regulations allow for these temporary raids is a growing problem as member firms kowtow to influential hedge funds. Just to show that Bear Stearns was not limited to such abuses, the CNS data for Lehman Brothers, another targeted company, Merrill Lynch, and Citigroup reveal similar patterns simply to lesser degree. In March, as Lehman watched 25% of their market drop the level of fails increased near 10-fold with the fails closed out only after the drop occurred. On Wall Street the code has been, donât tread on me and I wonât tread on you but clearly things have changed as the drive for hedge fund business has resorted to cannibalization amongst the participants. Today member firms freely take on settlement failures at the expense of all public companies including their brethren. They do so without fear of an agency who has stalled on reforms to address this issue for better than 2 years now. Feeling Hungry? Whoâs next? A thorough history of this issue and how Wall Street Regulators and the financial press have acted irresponsibly towards the victims of such fraud can be found at www.deepcapture.com. For more on this issue please visit the Host site at www.investigatethesec.com Copyright 2007
heres the deal.... what does the sec pay its top dogs??? 250k per for a commissioner? where do they go when they resign??
Couldn't have said it any better myself! The regulators absolutely rape the smaller B/D's and RIA's with a sand paper covered di*k. Great post!
How about a 10m fine for having an old business card in a client file? (A card from a former firm.) The dirty bastards! And, did you say $4,000,000 for the 1099? OH MY GOD!!!