August 30, 2009
..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.
On October 28, 2005, CMKM Diamonds, Inc. (best known by its trading symbol CMKX) was delisted by the SEC for non reporting violations, halting trading of the stock in a company that had issued an incredible 703 billion shares of real stock, sold to over 50,000 shareholders. Shortly afterwards, the company appointed a three person task force, consisting of Attorney Bill Frizzell, Attorney Don Stoecklein, and Howard Hughes former right-hand man Bob Maheu, to identify bonafide shareholders of the companys stock, a process that after seven months and three deadline extensions, still has not been completed, as brokers have used excuse after excuse to delay delivery of shareholders stock certificates.
Yesterday, Bill Frizzell sent a complaint letter to the NASD, along with copies to the SEC, Nevada state securities regulators, and several key members of Congress, claiming that there is indisputable evidence of large numbers of failed deliveries in this stock, and that brokers are trying to undermine shareholders rights by denying them their rights to ownership, stating that:
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.
In his complaint letter to the NASD, Frizzell lists a few of the reasons that brokers have given their clients for failing to deliver the stock certificates to their rightful owners. It is a list worthy of David Lettermans Top Ten:
The most alarming problems are represented by those shareholders who have been requesting certs from their brokers since the companys 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 brokers written response to a shareholders 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.
The above was taken from the book 'Naked Truth', written by Mark Faulk, almost 5 years later.....nothing has changed?
Disgraceful? You know it
Madoff is a case on point....he confessed He made no trades in 15 years The SEC couldn't/didn't see it?
It would be laughable if it were not so offensive
You all should be indicted and jailed for betraying the investing public by being so utterly incompetent in your duty. Why is it after so many years CMKM shareholders can't get ROI or closure? I just yesterday read a news article about an open pit mine being readied for next year by Shore Gold in Fort ala Corne Saskatchewan, with an estimated worth in the billions of dollars. There are over 60,000 shareholders that know for a fact the land around that area was CMKMs before all this malfeasance and claims of fraud ruined our hopes and disgraced the financial world.
This type of un-ethical and immoral conduct will totally remove any belief that people would have in the financial markets being a place to prosper.
Where is our justice?
It is written that 'the love of money is the root of all evil'.....too bad so many love money more than honour and that is why they will never be respected and thus are less than those they think are beneath them. I think it is much better to be poor and clean than it is to be filthy rich, especially since I treasure my holy soul. Sadly for many naive investors, the SEC does not share that noble sentiment
I fail to see the use of SEC as they appear to be quite impotent.