Subject: File No. S7-08-08
From: Thyra Mangan
Affiliation: Individual Investor

March 18, 2008

I've writen to Senator Clinton asking for her opinion of the financial markets and the failure of the SEC to enforce the securities laws of 1933 and 1934.

Look what we find here now that the 4Q 2007 FTD FOIA Data now available on the SEC website for October 2007 were released, only six months later.

On October 17th 2007, there were 3,653,372 FTDs in Novastar Financial (NYSE: NFI, current NOVS.PK). Pretty horrible for a stock with a float of around 9 Mn. But, three business days later it pops up to 4,168,119, or an increase of FIVE HUNDRED FOURTEEN THOUSAND FTDS.

Lets review what happened on October 17. For most of the day, little lots by little investors. We have 103 pages of screen shots and almost none over 1000 shares. People trying to manage their IRAs, etc.

But at 2:55:08, from Philadelphia, came a 2,000,000 share block (with the usual matching puts and calls). And, three business days later, the FTDs shot up HALF A MILLION SHARES.

Lets review a few other facts. One October 17th 2007, or thereabouts, none of the top five holders of NFI had 2 million shares.

On October 17th, 2007, the collective number of shares held by the top five (goldman sacs plus the next 4), was not equal to 2 million shares.

On October 17th, 2007, there were so many short shares in NFI, that NO ONE COULD LEGALLY BORROW 2 MILLION SHARES WITHOUT CALLING BACK SHORTED SHARES.

Now here is the icing on the cake: 2 hours later the NYSE announced that NFI was delisted from the exchange. Someone made a lot of money with that trade.

There you have it: the complete anatomy of an illegal trade in the US stock market, and no authority has done anything. Robbery in plain view, but no law enforcement can be bothered to track down the thiefs.

And, yes, it was reported to enforcement at the SEC on the day that it happened.

I asked Senator Clinton, as long as she is in Philadelphia, to please ask their securities exchange who did it, and why they allowed this thievery to be executed.

I ask you, why are you shafting the individual investor with additional delays of enforcement of all securities laws of 1933 and 1934? Enough.

Thank you,

Thyra Mangan, shareholder of NOVS, previously known as NFI