Subject: File No. S7-19-07
From: Adam Korkmaz

January 21, 2008

I am in favour of eliminating the ability to sell naked shorts. While the arguments that the ability to write naked shorts allows the markets to remain liquid and price moves tempered when real shares are temporarily not readily available, is probably valid, the current rules allow total misuse with impunity.

The company I am personally aware of is BRLC (Syntax-Brillian Corporation) on Nasdaq. This company only has 93 million shares issued and a float of 75 million shares. The naked short position is 21 million with 3 million of that being added just near the end of December. A few shares shorted to help manage price moves and keep the market liquid is one thing. 21 million naked short shares is something else.

Lets call them what they are. These are not naked shorts. They are 21 million counterfeit shares. It is illegal to counterfeit US money because of the damage it does to the US economy and the holders of US dollars. Why is it legal to counterfeit the shares of an individual company? The company is badly damaged and the holders of the company's legitimate shares are hurt as well. There is NO difference.

If you watch when these shares were counterfeited, it was to hurt the company by driving down their stock's price and THAT was the ONLY reason. When the company was having a liquidity problem due to slow receivables, they were going to have to sell shares. Just before they could, the market was flooded with massive volumes of counterfeit shares. The price tumbled making it very hard for the company to raise cash because the share price had been artificially cut in half.

This flooding of the market with counterfeit (naked) shares was NOT done to maintain a controlled market to cover a temporary short fall in available shares to help the company to help the investors in the company. It was done to help the pocket books of those who did it and those who wanted them to and perhaps paid them to do it. Perhaps an entity that wanted to buy out BRLC at a cheap price.

Perhaps you can't prove to yourself exactly what the wrong-doing was of 21 million counterfeit shares being issued of a company that only has a float of 75 million, but you do KNOW it was NOT done in the spirit of why you have the current rules.

There is only one solution. As long as rules can be bent or violated with impunity, then you can only outlaw the ability to temporarily issue naked (counterfeit) shares for option purposes or otherwise, by anyone including MMs for any supposed legit reason.

I acknowledge that part of my loses in this stock were due to poor decisions by management and free capital markets natural ups and downs. But, I KNOW and so do you KNOW, that the counterfeiting of 21 million shares and dumping them into those Capital markets was a definite contributor to the price going lower than it would have of and is THE cause of a significant portion of the financial losses I and many, many other investors have incurred in America's "Free" Capital Market System.

According to your website, this is only one company that has had its shares counterfeited and sold. It MUST be stopped. What is the total loss to the US economy and the savings of Americans?