Subject: Permanent Curbs on Shorts Unlikely

September 12, 2008


It was barely a year or so ago that you had a private conversation with Kara Scannell and called those that complained about the naked short selling issue as “bozo’s” identifying me personally. Suddenly this same reporter is reporting on pending SEC rule proposals before such proposals are made public. I wonder where the leak about pending rule changes came from. Does the SEC frequently release non-public information to “preferred individuals”?

Regarding the contents of this article, it appears that the private communications between short seller Jim Chanos and the SEC may have been beneficial as it would appear the SEC is about to propose a rule change that is counter to the sentiments of public issuers, investors, the US Chamber of Commerce, the American Banking Association, state legislature and state regulators, members of congress, and many amongst wall street. How does that happen? How does the SEC derail positive reform for weak and meaningless reforms?

“Instead, the SEC intends to make other, less sweeping changes aimed at curtailing abusive short-selling.”

Hasn’t the SEC already done this the past 5 years? Isn’t labor at the SEC a precious commodity that should not be wasted revisiting the same issue year after year after year?

How much more abuse is the SEC willing to accept so that wealthy individuals can steal more from the general public and from public companies? This is actually approaching criminal levels if the SEC compromises on positive reforms because of private meetings held with the crooks.

I just ask each of you, when is it that the SEC begins to commit to the general population? When does the SEC begin to take seriously the responsibilities congress imposed upon them?

Dave Patch

Copyrighted material redacted. Author cited to the following article: Kara Scannell, Permanent Curbs on Shorts Unlikely, Sept. 12, 2008