September 8, 2005
I agree 100% with R. Cromwell Coulson Chairman & CEO of Pink Sheets. Please read his letter to me below. As someone who has lost a lot of money because of short selling in OTC stocks I please ask that you change Rule 3360;
Dear OTC Investor:
I am writing to alert you of a very important rule change that is needed to improve the OTC marketplace. I need your help to make regulators turn on the lights and protect investors from the menace of hidden short selling in the OTC market.
I think you'll agree that this issue deserves the small amount of your time it will take for you to tell the SEC what you think about this issue.
As Chairman & CEO of the Pink Sheets, I know perhaps better than anyone the importance of improving the Pink Sheets and OTCBB trading. And I know the devastating impact that small companies face when their market is tarnished by the threat of manipulation.
There is a crisis facing the OTC market today in the lack of short sale position reporting and disclosure for OTC issues. This lack of transparency regarding short selling in the OTC market allows fraudulent acts to go undiscovered and manipulative short sellers to hide.
I believe regulators should fix the problem. Small issuers traded on the Pink Sheets and the OTCBB deserve the same transparency and regulatory oversight of short selling as those listed on Exchanges or NASDAQ.
Therefore, Pink Sheets has petitioned the SEC to cause the amendment of NASD Rule 3360 and require NASD broker dealers to maintain a record of total "short" positions in all customer and proprietary firm accounts in all publicly traded equity securities as well as report this information to the NASD for public dissemination of the short positions by security. The SEC's action is urgently needed to prevent fraudulent acts, expose market manipulation, promote fair principles of trade and protect investors.
Our full rule change request is available for you to read at: http://sec.gov/rules/petitions/petn4-500.pdf and comments by other concerned OTC market participants are available at: http://sec.gov/rules/petitions/4-500.shtml
But I cannot make this important rule change happen without your help. Thus I'm asking you to write a letter today, and voice your support to the SEC for the Pink Sheets' Request for Rulemaking Regarding Member Records of "Short" Positions and Reporting and Public Dissemination.
Thank you for your time and help in this fight.