Subject: File No. 4-520
From: Gary James

September 5, 2006

Here is the transaction: Broker A sells shares to Broker B. The sale by broker A is a short sale and the shares are not borrowed to make delivery and a "fail to deliver" happens today.

The Depository Trust Company (DTC) through the Continuous Net Settlement (CNS) system records the fail to deliver and more importantly the fail to receive by Broker B. Broker B issues a notice to DTC of the fail and a buy-in will take place two days after the fail if the shares are not received.

The problem is broker B (with the fail to receive) will not buy in broker A. So do not go after the naked short seller, go after the broker with the FAIL TO RECEIVE, Broker B.

Broker B can execute a buy-in two days after the initial fail.

After the buy-in, broker A will be (flat) out of his naked short position.
The Buy-in will cause the price to increase and a subsequent "short squeeze" will follow forcing all the short sellers to buy back their shares at a loss.