July 15, 2008
Dear Chairman Cox and SEC administrators,
I once again feel compelled to speak up on this issue as it has affected me and my family immensely in the last 5 years.
I realize it has been very difficult for the SEC/DTC to get a grip on this issue of naked shorting/EX clearing that has virtually raped millions of shareholders and wiped out many thousands of companies over the last 20 years or so, and I am glad that SEC officials are finally recognizing the scope of this problem and how huge it really is.
What I can't understand is why all of the stalling tactics-now the problem has reached the major indices and benchmark companies are being hammered by these sharks.
As an ex-penny stock trader who has lost alot of money, I watched many stock trading boards and saw how these crooks usually pumped a stock on these boards, (like Raging Bull Yahoo Finance or IHUB) to lure investors, and then they would send all of their paid bashers to post on the board, spreading lies, calling the company a scam, abusing the "real shareholders", slandering the CEO, or whatever means they could think of to shake investor confidence to get them to sell. The paid bashers would be on those blogging boards 24 hours a day 7 days a week....
Meanwhile they naked short the stock dumping millions of phantum shares on the market, and the stock tumbles down 60% in short order, and by 6 weeks it is down 98% and they hold it there, cellar boxing it, hoping the company bankrupts, so they never have to cover, and their profits are tax free.
I own CMKM stock and the stock has been delisted since 2005, pending the SEC investigation, and these same basher fools are on the boards day in and day out to this day. That tells all of us shareholders that are still waiting for this play out, that there is some big reason that these jerks are still hanging around spewing lies and filth on these investment boards.
Back to Reg SHO, I remember being so happy that the SEC was finally going to do something about the failure to deliver problem back in 2004, and they were going to stop these crooks from stealing and defrauding investors-I felt like justice was going to finally be served. Then the Grandfather Clause was announced, and that really made me angry. What a joke, I thought, these guys are actually going to get away with this. Other thoughts were that it pays to be a crook in America, and our whole financial system is at risk. I also thought that the SEC must be in collusion with these crooks, the system is rigged to steal our money and our regulators are letting this happen I used to visit the SHO list to see if any of the stocks that I was in were on it, and maybe 2 were for a very short time. We were in over 30 stocks in about a period of a year, and 90% of them should of been on the list, but never appeared. I would watch the trading volume on these stocks, and when they would start to short them, millions upon millions of shares would trade day after, driving the price down at a mad pace. The price per share would sink like a rock. I didn't understand what was happening at the time, but after seeing it happen over and over, it finally sunk in. We were being had...
It is now 2008, and the problem has mushroomed into something so toxic that our markets most probably will collapse from it.
The loopholes that are in the system, allowing EX clearing to be used more than going through the DTC need to be closed completely. That is how to fix it. I haven't seen any kind of report on Reg Sho showing any kind of effectiveness on handling this problem. On top of that, while you have been lagging on this, companies like Overstock have been on the list since it's inception, and their FTDs weren't covered until recently, maybe. That is so effective. Why even bother? 3 days to cover a FTD-Yeah sure.
Quit dragging your feet, find some experts to tell you what the real holes are in the system, and fix it. Europe fixed their problems. That is what you are paid for. I just hope it isn't too late for us.
I am proud that we small business owners of America can run our companies ethically, because I have come to believe that we are our country's only saving grace. This system is corrupt from top to bottom. We all know it, and you all have allowed it to happen. It's high time to take a stand against this mess and fix it this time. Quit letting money and power corrupt.