Subject: File No. S7-19-07
From: Brian V
Affiliation: CMKX Victim

July 19, 2008

Naked shorting/counterfeiting stock is and has always been illegal and immoral. Rather than worrying about changing this or that on paper, I believe that the SEC should simply enforce what is already illegal and do it more aggressively.

Having said that, I feel that the SEC should enforce this on both sides of the coin. While Naked Shorting has and does occur, many companies, particularly those listed on the "Pink sheets" love to use Naked Shorting as a cloak to hide their own immoral activities. In other words, the new racket is to scream "we're naked shorted" because our stock price won't go up, while the insiders are unloading massive amounts of shares into the market. Therefore, if you are going to start enforcing RegSho more aggressively, then how about looking more heavily at the companies who trade billions of shares a day and see where all that volume is coming from.

A good example would be a revoked company by the name of CMKM Diamonds, formerly stock symbol CMKX. You will see alot of comments by shareholders here that believe that this company failed simply due to naked shorting of its stock and believe they are going to be paid millions of dollars each because of the same. However, a little bit of research shows that the insiders were issuing massive amounts of stock. The outstanding share count ended up being over 703 billion shares. In this case, naked shorting just wasn't the problem. There may have been some counterfeiting/naked shorting of the stock, but all that was buried behind issuance of billions of REAL shares by the insiders. And to top it off, not one former company officer has seen the inside of a criminal court room yet.

So in summary, hammer those who do legitimately naked short a stock to death, but also consider adding a stipulation that any company that reports their stock has been naked shorted, but is in reality dumping shares, should also be prosecuted for fraud. If you want an amendment, then that should be it. Stop these non-reporting companies from using the RegSho/Naked Shorting excuse to steal money from unsuspecting investors. Penny stocks or not, it still doesn't give them the right to defraud investors. The laws dont need to be changed, just enforced.