March 24, 2008
Mr. Cox, you may like reading this: CMKX Shareholders Coalition for Market Reform unites against systemic problem create market wide awareness
On 31May2006, Mr. Bill Frizzell, a member of the CMKM Task Force and CMKM Diamonds shareholder attorney, submitted an extensive letter of complaint to the NASD Investor Complaint Center. Coupled with 10 stated complaints, and additional pages available, this letter specifically called for an investigation of brokerage conduct involving an upcoming CMKM distribution. Prior to revocation, CMKM Diamonds Inc. traded on the Pink Sheets with ticker symbol CMKX.
According to the latest CMKM Task Force shareholder count, there are currently over 38,900 CMKX shareholders worldwide of whom this ordeal has affected. With a united front of this size, great responsibility is carried in moving forward against the evils that continue to erode confidence in our securities markets, as apparent in Mr. Bill Frizzell?s letter of complaint. Beyond CMKX, this complaint should elicit sentiments of deep, market wide concern amongst all shareholders participating daily in market activities.
We, the CMKX Shareholders Coalition for Market Reform, are justifiably concerned that naked short selling, the electronic counterfeiting of securities, has became a menace of epidemic proportions, plaguing many viable developmental stage companies, as well as larger, prominent corporations. This behavior may have played a role in the current delay of all CMKM Diamond's shareholders obtaining physical possession of their stock certificates.
Mr. Frizzell's letter of Complaint to the NASD can be found on the CMKM Task Force website:
Re: Request for Investigation of Brokerage Conduct Involving CMKM Distribution
"Due to the indisputable evidence of large numbers of failed deliveries in this stock...."
"The most alarming problems are represented by those shareholders who have been requesting certs from their brokers since the company?s first announcement of a distribution seven months ago. Here is a sampling of excuses being given to shareholders as reasons for their inability to obtain a cert:
1. We had your cert, but it is now lost. It will take us another 6 to 8 weeks to obtain another one.
2. This stock purchase was a book entry only and no certificate is available.
3. Your stock was classified as a worthless security and is no longer in your account.
4. Our clearing firm has not been able to deliver these certificates due to a backlog of requests at the transfer agency.
5. I have been instructed we are no longer pulling certs for CMKM and there is nothing I can do. You need to contact the company.
6. CMKM Diamonds has a K code next to it, indicating that it is being held in safekeeping for the client. The clearing agent has made the decision not to issue certs but rather fax a copy of the certs it holds to the transfer agent.
7. Attached herewith is evidence of ownership of shares held electronically by XYZ clearing for ABC broker. ABC to confirm receipt of this proof of shares of CMKM and related companies are held with XYZ.
8. In light of the lack of cooperation (by the transfer agent), your May 15th, 2006 deadline must be bogus and must be extended, and Entourage shares could of course still be sent to ABC for the benefit of XYZ.
9. MNO said they had discussed with the Task Force the acceptability of the affidavit as proof of ownership in lieu of the certificate, and that it would be accepted. No such conversation ever occurred with the Task Force members.
10. We ordered your certificate, and it has been lost. You must now fill out a loss certificate. The transfer agent confirms that no certificate was ever issued.
Each quoted statement above is taken verbatim from a shareholders letter or from a broker's written response to a shareholder's request for a cert. I could continue with pages and pages of documented incidences of these broker responses to the requests of the shareholders if such is necessary to establish the need for a full investigation."
Nevada law NRS 78.235 mandates that each shareholder has the right to request and receive certificates of ownership from the company for their stock. Specifically, the statute states "....Every stockholder is entitled to have a certificate, signed by officers or agents designated by the corporation for the purpose, certifying the number of shares owned by him in the corporation."
To the Attorney General of the State of Nevada, regulatory officials, and Congressional Representatives, it is respectfully requested:
"This law has been broken and some seven months later, the people/shareholders of CMKX request that the necessary steps be taken to enforce this law."
Further, the impact of naked short selling (electronic stock counterfeiting), has had negative and far reaching effects on many companies, in which shares are being traded daily. The mounting indications of manipulative shorting and massive failures to deliver (electronic stock counterfeiting) associated within the fails statistics and confidential records held by the clearance corporations, leaves more questions than answers in regards to the enormity of this problem.
"Compliance with Regulation SHO began on January 3, 2005. Regulation SHO was adopted to update short sale regulation in light of numerous market developments since short sale regulation was first adopted in 1938.
Regulation SHO requires the SROs to disseminate a daily list of threshold securities where such SRO, or its market center, is the primary listing venue for any such security.
Currently, threshold lists include the name and ticker symbol of securities that meet the threshold level on a particular settlement date. Some investors have requested that the SROs provide more detailed information for each threshold security, including the total number of fails, the total short interest position, the name of the broker-dealer firm responsible for the fails, and the names of the customers of responsible brokers and dealers responsible for the short sales. The fails statistics of individual firms and customers is proprietary information and may reflect firms' trading strategies. The release of this information could be used to engage in unlawful upward manipulation of the price of the securities in order to "squeeze" the firms improperly."
However, considering the above information, the confidentiality and anonymity privileges enjoyed by these firms is at the expense of the victimized companies in question and their investors.
Starting with an increased awareness of this issue now is the time to act and let our collective voices be heard. While the CMKX shareholder base, of over 38,900+ shareholders worldwide, provides a formidable force to be reckoned with, the appeal of this complaint should capture the attention of all those who participate in a market that all investors should be able to place a great degree of faith and confidence into. Concerns over this issue have been expressed by many companies, beyond CMKX, and are deserving of our collective action.
This press release is meant to serve as a global rallying call for all shareholders, and companies, who have been affected by this issue. The systemic nature of this problem cannot be denied and all efforts will be taken to expose it.
The CMKX Shareholders Coalition for Market Reform is a non-partisan group and is dedicated to creating market wide awareness in regards to the systemic problem of stock manipulation. It is not affiliated, in any way, with the CMKX Owner's Group or the CMKM Task Force.
For more information: