March 27, 2008
File No. S7-08-08
Naked Short Selling Anti-Fraud Rule
These proposed changes in naked short selling rules are certainly an abrupt about-face for the SEC. For years, your SEC has been claiming, through Annette Nazareth, there is no naked short selling problem.
Our American public has little confidence in the SEC because of a lack of enforcement and a clear bias for allowing Wall Street to commit financial crimes, with impunity. Christopher Cox talks it up all big while reducing regulatory enforcement to near record lows.
Big Hat, No Cattle.
Here are some numbers comparing former chair, Bill Donaldson, to current chair, Christopher Cox. For readers, Donaldson was the chair of the SEC until President Bush fired Donaldson for being too aggressive with regulatory enforcement. Christopher Cox was shuffled in with Cox having a lax attitude about securities fraud. Cox is Wall Street's favorite son.
Numbers cited here are generated by the White House through the "Expect More" program, a system of evaluation of the effectiveness of different branches of our government. Our current chair, Christopher Cox, received a failing grade, an "F" for academic notation.
Numbers cited for Donaldson are based on 2004 year performance.
Numbers cited for Cox are based on 2007 year performance.
Cases Successfully Resolved:
Donaldson - 98%
Cox - 92%
Cases Filed After Complaint Initiation:
Donaldson - 69%
Cox - 54%
Monetary Disgorgements / Penalties Ordered
Donaldson - 86%
Cox - 55%
Expect More Summary: NOT PERFORMING - Results Not Demonstrated
Very clear to see Christopher Cox is working at reducing both regulatory enforcement and certainly reducing imposed fees and fines for financial crime.
Why should our American public believe the SEC is being sincere about reducing naked shorting financial crime after years of denying this crime and after Cox has effected a systematic program of reducing regulatory enforcement to a near record low? This is quite ironic in light of our White House grading the performance of Cox as an F for Failure.
I spent many hours digesting and understanding these proposed rule changes to reduce the crime of naked shorting. My final opinion is those proposed rule changes are riddled with loopholes which will both enable and allow Wall Street to continue selling counterfeit shares, as always. Might be some benefit in reducing naked shorting crimes by amateurs but there are no provisions to reduce naked shorting by professional criminals who populate Wall Street.
Those proposed rule changes clearly exempt "bonafide" Wall Street criminals.
My personal stance is adding these proposed rule changes will not benefit our American public nor lead to a reduction of naked short selling. These proposed rule changes are verbose legalese gibberish which translate into Plain English:
"This is a sugar pill for America. We are not really serious about this."
Give this a rest - we know the SEC is in the pocket of Wall Street.
Big Hat, No Cattle.