Categorized | The Mitchell Report

    Bernard Madoff, the Mafia, and the Friends of Michael Milken

    In 2005, Patrick Byrne, the CEO of Overstock.com and future Deep Capture investigative reporter, began a public crusade against illegal naked short selling (hedge funds and brokers creating phantom stock to manipulate stock prices down). He said, over and over, that the crime was destroying public companies and had the potential to trigger a systemic meltdown of our financial markets.

    Soon after, I began to investigate a network of short sellers, journalists, and miscreants. I concluded that many of the people in this network were connected to two famous criminals – “junk bond king” Michael Milken and his associate, Ivan Boesky. I also began taking a close look at the Mafia’s involvement in naked short selling.

    In my last installment (click here to read), I described some of the strange occurrences that attended this investigation. Where the story left off, I’d recently been threatened in a bookstore, and then ambushed by three thugs who told me to stay away from this story. My unwitting employer had been bribed by short sellers, Patrick had been told by a U.S. Senator that his life was in danger, and a Russian matryoshka doll had appeared on the desk of an offshore businessman.

    Inside this matryoshka doll was a slip of paper marked with the letter “F”…

    * * * * * * * *

    Soon after receiving the matryoshka doll, the offshore businessman invited Patrick Byrne to a greasy spoon diner in Long Island. Over the previous year, the businessman had provided Patrick with some information about the naked short selling scam, and the hope was that he might have something more to say.

    But that day at the diner, all he had was a message.

    “I’ll make this quick,” the businessman said, with two other witnesses present. “I have a message for you from Russia. The message is, ‘We are about to kill you. We are about to kill you.’ Patrick, they are going to kill you. If you do not stop this crusade [against naked short selling], they will kill you. Normally they’d have already hurt someone close to you as a warning, but you’re so weird, they don’t know how you’d react.”

    In a later conversation with a colleague of Patrick’s the businessman said [verbatim]: “These things don’t happen to me anymore. I mean, I’ve been out of that world [the world of Mafia stock manipulation] for a dozen years or more. These…there are defined signals here that lead me to believe that they [the Mafia] have been disturbed. The only way they coulda been disturbed is if they own Rocker or if he is using them for leverage.”

    Rocker. That’s David Rocker.

    At the time, David Rocker was a “prominent” hedge fund manager specialized in short selling (betting that stock prices will fall). It was also the case that Rocker had spent the last couple decades insinuating to people on Wall Street that he was somehow tied to the Mob.

    But Rocker was probably full of it. He didn’t have ties to the Mob. Perhaps he merely believed that his insinuations lent him a certain cachet.

    * * * * * * * *

    From 1973 to 1981, Rocker was a general partner in a short selling hedge fund managed by Michael Steinhardt, who is one of Wall Street’s most “prominent” investors, regularly hailed by The Wall Street Journal and CNBC as a genius and a font of wisdom.

    Some years ago, Steinhardt belatedly acknowledged that he is the son of Sol “Red” Steinhardt, who was once a major player in the Genovese Mafia organization. Steinhardt, Sr. spent several years in Sing-Sing prison after a New York City prosecutor described him as the “biggest Mafia fence in America.”

    Incidentally, experts concur that the Genovese Mafia family brought the Russian Mob to America.

    * * * * * * * *

    The largest investors in Steinhardt Jr.’s first hedge fund were associates of the Genovese Mafia (whose investments came in large sacks of cash), Marty Peretz (future founder, with Jim Cramer, of TheStreet.com), Marc Rich (future fugitive charged with tax evasion and illegal trading with Iran and Libya), and Ivan Boesky (later imprisoned on multiple counts, most of them involving stock manipulation schemes orchestrated with “junk bond king” Michael Milken).

    By 1991, Steinhardt owned another hedge fund — JGM Management – with a “prominent investor” named James Marquez. The star employee at JGM was “prominent investor” Samuel Israel III.

    A few years later, Israel and Marquez founded the Bayou Group, one of the biggest hedge fund frauds in history. A significant part of the Bayou fraud involved Israel “feeding” his investors’ money into a Ponzi scheme run by Robert Booth Nichols, who has been targeted by authorities as a business associate of the Genovese Mafia family.

    When Israel was sentenced to prison last year, he briefly disappeared. His car was found on a bridge. Scrawled in the dust on the hood was a note: “Suicide is Painless.”

    Authorities arrested Israel’s girlfriend, whom they suspected of harboring a fugitive. Shortly after, Israel rode a red motor scooter to a Boston police station and turned himself in. Apparently, he was not dead. He had tried to fool us.

    Meanwhile, Israel had filed a lawsuit against Nichols, alleging that Nichols had ripped him off. Apparently, Israel (who could not be reached for this article) would like us to believe that he is not tied to Nichols or the Genovese Mafia.

    Nonetheless, Israel has a certain cachet. So do Steinhardt and James Marquez.

    * * * * * * * *

    In the 1990s, Steinhardt founded another hedge fund, Steinhardt Partners. The co-founder and head trader of Steinhardt Partners was a “prominent investor” named John Lattanzio.

    The limited public information about Lattanzio concerns a Russian prostitute.

    Apparently, Lattanzio proposed marriage to the prostitute and gave her a diamond ring. Alas, the couple separated, and Lattanzio asked for his ring back. After all, it had cost him $289,275.00.

    But the prostitute seemed to believe that the ring was payment for services rendered. The dispute ended up in court, where the prostitute testified that Lattanzio had told her that he had ties to the Mafia.

    Yes, said the prostitute, Lattanzio (Steinhardt Partners’ co-founder and head trader) had big-time Mafia connections, and he “would not hesitate to use them to harm me.”

    From what I know of Russian strumpets, there is at least one area where they cannot be trusted – and that is where it concerns their love life. So perhaps Lattanzio had his heart broken. Perhaps, in the heat of passion, he said some crazy stuff about the Mafia to make himself seem dangerous. If that is the case, I send Mr. Lattanzio my condolences.

    Indeed, I would enjoy meeting him. He has a certain cachet.

    * * * * * * * *

    Rocker left Steinhardt’s hedge fund in 1981 and went to work for an investment management firm called Century Capital Associates.

    Information on this firm is limited, but it seems to have been largely owned in the 1980s by the Belzberg brothers — William, Sam and Hymie.

    The Belzbergs were among Michael Milken’s closest cronies (family member Mark Belzberg was in fact implicated by the SEC in Milken’s stock manipulation schemes). They were at the inner core of the Milken machine – buying and selling the junk bonds of other Milken cronies. Often, the Belzbergs collaborated with Milken to blackmail, seize, or destroy public companies. .

    In the late 1980s, the Belzbergs announced that they were going to take over Crazy Eddie, which was then a famous home electronics retail chain. The Belzbergs joined forces with Crazy Eddie’s founder, Eddie Antar, and the company’s chief financial officer, Sam Antar, in a supposed effort to take the company private.

    This is a story for another time, but for now it suffices to say that Crazy Eddie was a massive fraud, the Belzbergs (and Milken) likely knew this already, and when the company was raided by the FBI a few months later, it emerged that Sam Antar had been feeding information to both the FBI and a lawyer, Howard Sirota, who was preparing to sue the company.

    The Belzberg’s did not buy Crazy Eddie. Instead, just before the FBI arrived, the company was sold to another investor, Victor Palmieri. Robert A. Marmon, who was hired by Palmieri to run Crazy Eddie, told me that he arrived to find that the company’s top employees – the only people who had had direct access to the Antars – were all burly, armed thugs who claimed to be former employees of the Mossad, Israel’s secret intelligence agency.

    It was Marmon’s job to fire the Antars’ corporate goons. “I’ve never been so scared in my life,” he said. “There weren’t any explicit death threats. They just stared you down, so you got the message.”

    * * * * * * * *

    Sam Antar is a convicted felon, but he never went to prison because he testified against his cousin, Eddie Antar, in return for house arrest. Now he is paid by short sellers with ties to David Rocker and associates of Michael Milken. The assignment to which he devotes the majority of his time is to use the Internet to harass and smear the reputations of Deep Capture founder Patrick Byrne and his colleagues.

    At one point, Antar threatened the young children of Deep Capture reporter Judd Bagley, posting their names, ages, and address on the Internet. As I described in my last installment, Antar has made what I can only interpret to be veiled references to two seminal events in my life – the time I was ambushed and punched in the eye by three thugs, and the day that a goon in a bookstore threatened my close relative.

    When he is not harassing us, Antar helps Howard Sirota (the attorney who sued Crazy Eddie) file bogus class action lawsuits against companies targeted by short sellers. A recent court case also describes Antar delivering $250,000 in cash to a man named Barry Minkow

    In the 1980s, Minkow built a carpet cleaning and insurance restoration company called ZZZZ Best, with the bulk of his finance coming from Michael Milken, and other funds coming from associates of the Genovese organized crime family.

    ZZZZ Best was a massive fraud that manufactured false restoration claims – some of them on Las Vegas casinos that had been financed by Michael Milken and investors tied to the Genovese organized crime family.

    Minkow spent some time in prison. Now he runs an outfit called the Fraud Discovery Institute out of the Community Bible Church in San Diego, where he is a preacher. The Fraud Discovery Unit is in the business of publishing negative information about public companies targeted by Howard Sirota and short sellers tied to David Rocker, Michael Steinhardt, and associates of Michael Milken.

    In one of Sam Antar’s famous Internet messages (he signs them, “Sam Antar, Convicted Felon”), he warned that we at Deep Capture were taking chances by writing about the Mafia connections of Barry Minkow, whom Antar described as his “friend.”

    “You have awakened a sleeping giant,” Antar wrote.

    * * * * * * * *

    In addition to their involvement with Crazy Eddie and David Rocker’s operation, the Belzberg brothers – William, Sam, and Hymie – also tried in the 1980s to take over a investment services concern called the Bache Group. But executives of the Bache Group did not want the Belzbergs to seize their company.

    According to the executives, the Belzbergs had ties to the Mafia. The executives went public with their allegations, citing, among other things, a U.S. Customs report that described the Belzbergs cavorting with some Genovese mafiosi in Acapulco.

    Fortune magazine reported that these allegations were “unsubstantiated.”

    But the Belzbergs have a certain cachet

    * * * * * * * *

    The Belzbergs were also the largest providers of capital to John Mulheren, a “prominent investor” who was famous in the 1980s for the arbitrage operation that he ran out of Spear Leeds & Kellogg, a broker-dealer and notorious naked short seller that was later merged into Goldman Sachs Execution and Clearing (which currently employs Elliot Faivinov, a Russian man who in 2006 was, for reasons of his own, receiving copies of the phone records of a woman who was then Deep Capture reporter Patrick Byrne’s girlfriend).

    The Department of Justice alleged that Mulheren routinely engaged in stock manipulation schemes with Ivan Boesky, targeting companies financed by Milken. In 1987, when Boesky was indicted, and the government began to investigate Milken, Mulheren announced that he was going to murder Boesky.

    Depending on the story, Mulheren either forgot to take his psychiatric medication, or he was worried that Boesky was going to squeal. Either way, he was arrested on the way to Boesky’s house. In Mulheren’s car, police found a 9-millimeter pistol, a .357 Magnum, a 12-gauge pistol-grip shotgun, a .233-caliber Israeli Galil assault rifle, and 300 rounds of ammunition.

    It is a common misperception that Boesky’s testimony led to the 98-count indictment of Michael Milken. Considering the scope of business the two criminals did together, Boesky actually provided very little information to the government. He told prosecutors that he was afraid that he might be killed. On several occasions he told prosecutors that he might be killed by Milken’s “friends in Vegas.”

    * * * * * * * *

    Far more important to the government’s case against Milken was evidence that it obtained when 50 armed troopers stormed the offices of a hedge fund called Princeton-Newport. The founder of this hedge fund, Edward Thorp, once partnered with the Genovese organized crime family to develop a system for cheating Las Vegas casinos. He wrote a seminal book on counting cards in black jack, and soon after, he was a critical – perhaps the most critical – figure in the Milken operation.

    The base of Milken’s operation was the high-yield debt department of Drexel Burnham Lambert in Beverly Hills. From there, he underwrote and sold billions upon billions of dollars worth of junk bonds. Hence the moniker, “the junk bond king.”

    But most observers believe that Milken derived a greater part of his fortune from a web of private partnerships and personal brokerages that traded, and often manipulated, not just the debt, but also the stock of public companies. Most profitable of all Milken’s businesses were two Chicago-based brokerages – Belvedere Securities and EGM partners – that he co-owned with the Genovese Mafia card-counter Edward Thorp.

    In 2006, Thorp’s son, Jeffrey, was charged by the SEC with destroying more than 20 companies in a scheme that involved unbridled naked short selling (millions upon millions of phantom shares sold into the market). Jeffrey Thorp also collaborated closely in short selling schemes with Anthony Elgindy, a notorious phantom stock peddler who is now serving an 11 year prison sentence for stock manipulation, extortion, and bribing FBI agents.

    Elgindy, like Thorp’s father, is tied to the Genovese organized crime family.

    When Elgindy appeared in court for sentencing, the judge noticed that Elgindy was missing the tip of one finger. Elgindy could not provide a straight answer as to what had happened, but a source close to the Elgindy investigation claims that Elgindy was forced by Russian mobsters to saw off his own finger as a warning not to squeal on his partners in crime.

    * * * * * * * *

    When delivering the death threat to Patrick Byrne, the offshore businessman mentioned David Rocker, and as we now know, Rocker was a general partner in Michael Steinhardt’s first hedge fund — largely capitalized by the Genovese Mafia and Ivan Boesky. We also know that Rocker later worked for Century Capital, largely owned by the Belzbergs – William, Sam, and Hymie – who might or might not have been cavorting with Genovese mafiosi in Acapulco, but were certainly the largest funders of John Mulheren.

    After getting caught on his way to murder Ivan Boesky, Mulheren went to jail, where he spent most of his time in consultation with Anthony “Fat Tony” Salerno, a Genovese Mafia capo who had recently begun a 100 year prison sentence.

    Upon his release, Mulheren (whose convictions were later reversed on appeal) went into business with a “prominent investor” named Israel Englander. Soon after that, Mulheren died (apparently of a heart attack), but Englander continued to manage Millennium Partners, a “prominent” short selling hedge fund whose major investors are the Belzbergs – William, Sam, and Hymie.

    By this time, David Rocker had left the Belzberg’s Century Capital to start his own hedge fund – Rocker Partners.

    * * * * * * * *

    Here I must skip ahead more than a decade: In 2004, Deep Capture reporter Patrick Byrne (pursuant to his day job of being CEO of Overstock.com) was on a Lehman Brothers-sponsored road show seeing dozens of hedge funds, attempting to sell a $120 million convertible bond in Overstock. When he sat down in Millennium’s offices, a man entered. His opening words were, “Millennium wants to take the entire $120 million of this offering. Of course, we’ll need a board seat to go with that.”

    This would have given the hedge fund access to inside information about Overstock. And it would have given Millennium the ability to sell the company short without borrowing shares in the open market.

    This is a common strategy employed by short sellers tied to Michael Milken or his associates. As I will show in future stories, many companies that agree to this arrangement are eventually destroyed or seriously wounded by naked short selling – hedge funds offloading phantom stock.

    Overstock board member Gordon Macklin, the former chairman of Hambrecht & Quist, a straight-shooting investment bank, warned Patrick not to do the deal with Millennium.

    Millennium, after all, had a certain cachet.

    Patrick declined Millennium’s offer, and went ahead with the offering to a number of hedge funds.

    A few months after Millennium’s offer to acquire the bonds, affiliated hedge fund managers, including David Rocker, began a short selling attack on Overstock.

    * * * * * * * *

    One hedge fund closely affiliated with David Rocker is SAC Capital, which is managed by Steven Cohen, and is said to account for more than 3 percent of all the trading on the New York Stock Exchange. BusinessWeek magazine has described Cohen as “The Most Powerful Trader on Wall Street.”

    Some years ago, there was an article by Fortune magazine called “The Shabby Side of the Street.” This article did not mention Steve Cohen. It did not mention him because, by this time, Cohen was a “prominent investor.”

    But while “The Shabby Side of the Street” does not mention Cohen, it is all about Gruntal & Co., which is where Cohen spent his formative years. Cohen was a proprietary trader for Gruntal in the 1980s and early 1990s – up until the day when he founded SAC Capital.

    Gruntal, we can assume, is where Cohen developed his network and learned the tricks that made him the “most powerful trader on Wall Street.”

    Fortune magazine interviewed a former Gruntal employee, who described the ambience there: “Gruntal was the Island of the Misfit Toys. But they didn’t care what was going on in our sick, dysfunctional office as long as we were making money. We had no manager, and it’s illegal not to supervise brokers. I remember doing cartwheels down the hall, drinking beer at my desk, smoking pot, having sex in the stairwell. Whatever!”

    * * * * * * * *

    The Fortune magazine article about Gruntal also failed to mention Michael Milken. It did not mention Milken because Milken was, by then, a “prominent philanthropist.” But Milken had been intimately involved with Gruntal, whose parent company, a financial services and insurance conglomerate called the Home Group, had been central to the Michael Milken empire.

    As nearly every account of Michael Milken’s schemes will tell you, Milken worked with a select group of cronies (many of whom controlled large insurance and financial services conglomerates) to operate what amounted to a Ponzi scheme.

    The cronies would sell junk bonds through Milken to raise finance. Then the cronies would use much of this finance to buy (from Milken) the junk bonds of other cronies in the group. The cronies and Milken would then trade the junk bonds among themselves, raising their prices incrementally as they passed them on to the next crony (a process known as “daisy-chaining”), before fobbing them off to little old ladies and dimwitted pension fund managers.

    Until the scheme collapsed, Milken’s junk-bond merry-go-round generated enormous profits and seemingly unlimited finance for his select cronies. So the cronies could not only buy more junk bonds from Milken, but they could also use their billions to harass, destroy, or initiate hostile takeovers of public companies.

    Meanwhile, Milken presided over a nationwide network of private partnerships (such as those he had with the Mafia card-counter Edward Thorp), arbitrage and short selling partnerships (such as Ivan Boesky’s criminal operation), short selling hedge funds (such as Michael Steinhardt’s Mafia-funded outfit), and brokerages that could help put public companies on the defensive.

    Home Insurance was a key buyer and issuer of Milken junk bonds. It was the second largest unsecured creditor to Milken’s operation at Drexel. It also owned about $15 million worth of Ivan Boesky’s short selling and arbitrage outfit. Meanwhile, Home’s subsidiary, Gruntal & Co., employed traders who were on quite friendly terms with Milken and others in his network.

    * * * * * * * *

    Gruntal’s options department was founded by a man named Carl Icahn. After leaving Gruntal, Icahn formed Icahn & Co., receiving most of his finance from Michael Milken, but also a significant chunk of capital from a “prominent investor” named Zen Wolfson.

    Since then, Wolfson has been involved with a number of Wall Street brokerages that are tied to the Genovese Mafia. One such brokerage is Pond Securities, which, in 2001, was implicated by the SEC in a massive naked short selling (phantom stock) fraud. Among the victims of Pond Securities were companies that had employed the services of Ladenburg Thalmann, an investment bank largely controlled by Carl Icahn.

    In an upcoming story, I will tell you more about Ladenburg Thalmann’s role in the naked short selling scandal. I will tell you more about Pond Securities and its relationship with a man who remains a fugitive in Austria. And I will tell you more about Carl Icahn, who is not only one of the most “prominent investors” in America, but also a man with a certain cachet.

    * * * * * * * *

    Another employee of Gruntal – a fellow who sat next to Steve Cohen (later known as “the most powerful trader on the Street”) – was Stephen Feinberg, who had moved to Gruntal from Michael Milken’s operation at Drexel Burnham Lambert. Feinberg had been one of Milken’s most favored employees. Most likely, he moved to Gruntal (“the “shabby side of the Street,” as Fortune magazine described it) to reinforce the relationship between Gruntal and Milken’s nation-wide stock manipulation network.

    Nowadays, Feinberg runs Cerberus Capital, one of the most powerful private equity firms in America. In an upcoming story, I will tell you how Cerberus loots the companies it seizes.

    Its techniques have a certain cachet.

    * * * * * * * *

    Yet another “prominent investor” who sat on Steve Cohen’s trading floor at Gruntal was Samuel Israel III.

    Israel left Gruntal to work for a hedge fund owned by Steinhardt (the son of the “biggest Mafia fence in America”). As you will recall, Israel later wrote “Suicide is Painless” on his car and briefly disappeared after being sentenced for masterminding one of the largest hedge fund frauds in history – a fraud that Israel ran with help from a co-founder of Steinhardt’s hedge fund and another fellow connected to the Genovese Mafia.

    Also on Steve Cohen’s trading floor at Gruntal was Maurice A. Gross, whose biggest client was Thomas Gambino, a prominent member of the Gambino Mafia family. This was in the days when the Gambinos and the Genovese still collaborated on Wall Street.

    Gross later left Gruntal, and in 1997, he and a Pakistani fellow named Mohammad Ali Khan tried to steal the Gambinos’ money.

    Fortunately, Elliot Spitzer intervened. At the time, Spitzer was New York’s attorney general. Throughout his political career, Spitzer received by far the greatest percentage of his campaign funding from short sellers (such as Jim Chanos, who provided a rent-free beach house to the hooker who later forced Spitzer to resign as governor) who are closely tied to Steve Cohen and SAC Capital.

    Spitzer forced the former Gruntal broker to give the Gambinos their money back. There is no evidence, however, that Spitzer was concerned that New York’s second largest organized crime family was running money through a brokerage owned by cronies of Michael Milken and Ivan Boesky.

    In 1996, Gruntal was charged with embezzling millions of dollars. By then, Steve Cohen had left to begin his career as the “most powerful trader on the Street.”

    * * * * * * * *

    So in 2006, I was investigating Steve Cohen’s SAC Capital, David Rocker, Michael Steinhardt and their network of miscreants. I was also investigating “prominent” journalists (at The Wall Street Journal, The New York Times, CNBC and other major news organizations) who had unusual relationships with this network and who were going to extraordinary lengths to cover up the naked short selling (phantom stock) scandal.

    That’s when three guys in Armani suits saddled up to me in a quiet bar. As you will recall from my last installment, one of the Armanis introduced himself to me as a former Boesky employee, and told me a story about a fellow who got his brains blown out after “peeking” into the ladies underwear department at Saks Fifth Avenue.

    Steve Cohen’s SAC Capital is known colloquially as “Sak.” I do not know for certain that Armani was telling me I shouldn’t be “peeking” at Cohen’s dirty underwear. It was a strange encounter, to say the least.

    But if you doubt that journalists sometimes receive such threats, consider the case of Los Angeles Times reporter Anita Busch. One day after work, Busch found, in the front seat of her car, a dead fish and a rose. In the windshield of her car, there was bullet hole and a note that said, simply, “Stop!”

    Later, the LA Times reporter was nearly killed when two men in a black Mercedes tried to run her over.

    All of this was the handiwork of Anthony Pellicano, a former soldier in the Genovese Mafia organization who had found employment as a hired-thug and private investigator. Most of Pellicano’s clients had been Hollywood actors like Steven Seagal (who has been reported by some news organizations to have ties to the Mob, though I have not confirmed those reports) and various billionaires, a significant number of whom had ties to Michael Milken.

    When Pellicano put the dead fish and the bullet hole in the reporter’s car, he was working for Michael Ovitz, the Hollywood mogul. Busch and the LA Times were investigating the business dealings of Ovitz, and Ovitz apparently hired the former Genovese Mafia soldier to stop the story in its tracks.

    Ovitz, as you may know, is one of Michael Milken’s closest friends. They were high school classmates. In later years, Milken and Ovitz did a lot of business together.

    While Pellicano was threatening an L.A. Times reporter, he was also employed by Adam Sender, who runs a hedge fund called Exis Capital. Sender is a former employee of Steve Cohen at SAC Capital. Steve Cohen — the “most powerful trader on the Street” — provided Sender with most of his start-up capital. Exis and Sender are considered by most everyone on Wall Street to be essentially subsidiaries of SAC (a.k.a. “Sak”).

    Apparently, Sender had some kind of dispute with a business partner, so he called Pellicano, the former Genovese Mafia soldier. In a conversation that was recorded by the FBI, Sender said to Pellicano: “You have 100% free reign to do whatever you feel will make this cocksucker as unhappy as possible…I’d like to make the fucking asshole as uncomfortable as possible…I’m going to continue the lawsuit until doomsday… when the time is right I’m going to fix him.”

    You can listen to the full conversation here.

    In a later conversation, Pellicano allegedly offered to have Sender’s business partner disappear. The former Genovese soldier said he’d make his move while the business partner was driving to Los Angeles from Las Vegas. He’d force the business partner off the road. Then Pellicano would kill the business partner and bury him in the Nevada desert. Nobody would know a thing.

    In court, Sender testified that he turned down Pellicano’s murder-for-hire offer. But Pellicano was convicted for multiple crimes – such as offering to have a man buried in the Nevada desert and putting a dead fish, a rose, and bullet hole in the car of a journalist investigating Michael Milken’s best friend from high school.

    * * * * * * * *

    I do not know whether any merit can be given to the offshore businessman’s speculation that Rocker might be “owned” by the Mafia. I do not know whether Rocker had anything to do with the message that the Russian Mafia was going to kill Patrick Byrne.

    I do know, however, that in a later phone conversation, the offshore businessman explained how the death threat had been conveyed to him. He said he returned home one night and his wife told him there was a package on his desk. “And there was a beautiful little box, and inside was a matryoshka.”

    “And I opened up the…matryoshka, and inside is an `F’ with a cross on it — which is from Felix.”

    The businessman said he contacted Felix. And Felix said, “tell [Patrick]….we’re going to fucking take it private.”

    * * * * * * * *

    In 1998, Felix – that’s Felix Sater – forgot to pay the rent on a locker at the Manhattan Mini Storage in Soho. As a result, police found inside this locker two pistols, a shotgun, and a gym bag stuffed with documents outlining various money laundering and stock manipulation schemes orchestrated by Felix Sater and his partners.

    Felix is a Russian immigrant said by authorities to have ties to both the Russian Mafia and the Genovese organized crime family.

    In 1991, Felix stabbed a stock broker in the face with a broken stem of a wine glass.

    * * * * * * * *

    After reviewing the contents of Felix’s locker, the FBI launched a sweeping investigation that culminated, in the summer of 2000, with the bureau’s famous “Operation Uptick” – sometimes referred to as the “Mob on Wall Street” operation. More than 100 stock brokers and investors allegedly tied to the Mafia were arrested – the biggest securities bust in FBI history.

    Among those arrested in the “Mob on Wall Street” operation were a number of people tied to Michael Milken or his closest cronies. One of them was Gene Phillips.

    In the 1980s, Phillips ran a company called Southmark, which was at the center of the Milken Ponzi. Southmark was, in fact, the single largest real estate conglomerate ever financed by Milken. But it didn’t just buy real estate. In only one of many transactions, Milken delivered over $400 million in junk bond finance to Phillips, and Phillips used every penny of that finance to buy (from Milken) the junk bonds of other Milken cronies.

    The “Mob on Wall Street” case alleged that Phillips engaged in stock manipulation schemes with a coterie of miscreants who were tied to the Genovese organized crime family. Ultimately, Phillips was acquitted.

    But even before he was arrested, Phillips had a certain cachet.

    * * * * * * * *

    Felix Sater (the man who allegedly sent the matryoshka doll) was ultimately named as an “unindicted co-conspirator” in a Mafia-run stock fraud. One of his friends co-authored a book, “The Scorpion and the Frog,” which suggests that Sater (whom the author of the book gives a pseudonym, “Lex Tersa”) cut a deal allowing him to avoid prosecution if he helped the CIA set up a phony arms deal with Osama Bin Laden. Anything is possible, I suppose.

    At any rate, Sater is now the (silent) proprietor of the Bayrock Group, a real estate investment company. The Bayrock Group has eleven partners. All are of interest, but let’s focus on two of them.

    One is The Sapir Organization, which is an organization run by a Russian immigrant named Tamir Sapir. A lawyer for The Sapir Organization said the organization would answer no questions because the organization is “very, very private.” So information about Sapir’s background is spotty.

    Sapir has stated publicly that he once owned a home electronics store that catered to Russian KGB officials living in New York. The name of the store remains a mystery. All Sapir has said is that he was “the Crazy Eddie of Russia” – a playful reference to Sam Antar’s electronics company (i.e., the massive fraud that the Antars were going to take private with those Milken cronies, the Belzbergs – Walter, Sam, and Hymie).

    After electronics, Sapir began trading oil. Then he struck it big in real estate. Now, he is believed to be a billionaire.

    He might also be a Russian Mafia boss. Journalists have danced around this issue. Sapir himself has stated to The New York Times that “I am not Mob.” But he once had Genovese Mafia associates running his real estate empire. So if Sapir is not a Russian Mafia boss, he is at least a Russian boss of Mafia employees.

    By way of example: The man who formerly ran The Sapir Organization’s real estate portfolio is named Frederick J. Contini. In addition to being associated with the Genovese Mafia clan, Contini once entered a secret plea to racketeering.

    Also, Contini once stabbed a man in the face with the broken stem of a wine glass.

    He said it was just a bar fight.

    This was some months after Felix Sater stabbed a man in the face with the broken stem of a wine glass.

    Felix said it was just a bar fight, too.

    * * * * * * * *

    The second important partner of Felix Sater’s Bayrock Group is Apollo Real Estate Advisors, which is part of the empire controlled by a famous billionaire – Leon Black.

    If Michael Milken were to name the ten people who are closest to him, Leon Black would surely be one of them. The two men have known each other since at least 1975, when “prominent investor” Carl Lindner, who was one of Milken’s key junk bond cronies, was acquiring shares in United Brands, formerly known as United Fruit, a company that has been accused of everything from bribing heads of state to funneling money to Latin American drug gangs.

    Lindner eventually gained control over the company, but not before Eli Black — United Brands’ CEO and the father of Leon Black — crashed through a thick plate-glass window on the 44th floor of the Pan Am building, and plunged to his death.

    They said Black broke through the plate glass window with his briefcase.

    They said it was suicide.

    * * * * * * * *

    Some years after his father crashed through the window, Leon Black was heading up mergers and acquisitions at Drexel Burnham Lambert, home base of Milken’s junk bond operation. Black was Milken’s most ardent ally at Drexel. After Milken was indicted, Black rallied to Milken’s defense. It was Black, more than anyone, who prevented Drexel from firing Milken. And Black has remained obstinately loyal to the criminal Milken ever since.

    After Milken went to prison, Black founded the Apollo Group, an investment partnership that received most of its initial funding from a French aristocrat named Rene Thierry Magon de La Villehuchet.

    Among Black’s first moves as an independent “prominent investor” was to launch a takeover bid for Executive Life, a bankrupt insurance and financial services conglomerate.

    The Black group won the bid after a fierce battle with a group of competing bidders, led by Jack Byrne, who was then the chairman of Fireman’s Fund, a major insurance company.

    Later, though, it emerged that Black’s takeover of Executive Life had been illegal because he had secretly been fronting for certain French investors, including Monsieur Rene Thierry de La Villehuchet. Some of the French investors had illegally parked stock with Black to hide their involvement (“parking stock” being one of the favorite techniques of the Milken-Boesky-Thorp crew, and a recurrent theme in the 98-count indictment that sent Milken to jail).

    There were indictments (though, somehow, not of Black or Monsieur Rene Thierry de La Villehuchet). After the indictments, Jack Byrne, recognizing that he’d been cheated out of a deal, sued Black and won an $80 million dollar judgment, some $30 million of which was ultimately paid to Jack Byrne’s company.

    Jack Byrne, of course, is the father of Patrick Byrne, who a few years later received a vicious death threat, allegedly by way of a Russian matryoshka doll delivered by Leon Black’s Mafia business partner Felix Sater.

    * * * * * * * *

    None of which is to suggest that Black or Michael Milken had anything to do with the matryoshka doll or the death threat. Milken is now a “prominent philanthropist,” and Black is a “prominent investor.” But if anybody sees Mr. Black, please ask him if he thinks his Mafia friends could help us get to the bottom of this.

    (Neither Black nor Felix nor Milken return my calls).

    * * * * * * * *

    Executive Life, the company that Black’s group illegally purchased, was in bankruptcy because it had been transformed into a Ponzi scheme by Fred Carr, who is widely regarded to have been Michael Milken’s single most important junk bond crony.

    Milken delivered billions of dollars in junk bond finance to Carr, and Carr used much of his Milken finance to buy (from Milken) junk bonds that had been issued by Gene Phillips, the Belzbergs, Carl Lindner, and few others in Milken’s close circle of cronies.

    Prior to destroying Executive Life, Carr was tied to a mutual fund company called Investors Overseas Services. Carr was a “feeder” (somebody who raised money) for Investors Overseas Services, and at one point he announced that he was a major shareholder in the company and planned to take it over.

    Another “feeder” to Investor Overseas Services (OIS) was John Pullman, a reputed associate of the Genovese organized crime family. At one point, Canadian police taped a conversation in which Anthony “Fat Tony” Salerno (the fellow whom John Mulheren befriended in prison after failing to assassinate Ivan Boesky) suggested that Pullman owed him money.

    There was also Sylvain Ferdman. He couriered cash to IOS from clients in South America. Ferdman testified before a grand jury in New York that he had also been a courier for the Genovese organized crime family.

    * * * * * * * *

    No story about Michael Milken is complete without reference to a “prominent investor” named Meshulum Riklis. By most every account, Riklis was Milken’s first big client and his most important mentor – the man who taught Milken the art of junk bond Ponzis and stock manipulation.

    Riklis, who was also known as the husband of Hollywood starlet Pia Zadora, began working with Milken not long after Riklis bought Schenley Distributors, a distillery, in a deal that was clouded by accusations of pay-offs to organized crime. Schenley retained as its major distributors one Joseph Fusco, reputed to be a former member of Al Capone’s gang in Chicago, and Joseph Linsey, a colleague of the Genovese family mobster Meyer Lansky (who worked closely with Michael Steinhardt’s father).

    Riklis’s next move was to buy the Riviera casino in Las Vegas. Reportedly, he was hand-picked for this deal by the sellers, a group of Mafia-affiliated characters led by Morris Shenker, who was the personal attorney, close confidant, and business partner of Jimmy Hoffa, the Mafia-connected president of the Teamsters.

    One day, Hoffa had a meeting scheduled with Anthony “Tony Jack” Giacalone and Anthony “Tony Pro” Provenzano, two capos of the Genovese organized crime family. Hoffa disappeared on the way to the meeting and was never seen again.

    By then, though, the Teamsters had become one of Milken’s most important customers –dependable buyers of junk bonds that Milken issued for select cronies – Riklis, Carr, Gene Phillips, Carl Lindner (who was acquiring United Brands when Leon Black’s father fell through a thick plate glass window), and just a few others.

    * * * * * * * *

    Through Riklis and the Teamsters, Milken built a solid clientele of Las Vegas casino operators, such as Carl Icahn, and related enterprises (such as the Genovese-financed ZZZZ Best carpet cleaning outfit).

    One of Milken’s biggest clients was Steve Wynn, a “prominent investor” who received lots of Milken finance to open casinos and buy (from Milken) junk bonds issued by other Milken cronies – Lindner, Riklis, Gene Phillips, Icahn, and a just a few others (all of whom had a certain cachet – more on the others in upcoming stories).

    Wynn is now widely credited with transforming Las Vegas into the kind of place where you can go with the kids.

    Meanwhile, Milken describes Wynn as one of his closest friends.

    In 1983, which is right around the time that Milken and Wynn began doing business together, the Criminal Investigation Department of London’s Scotland Yard produced a report stating that “the strong inference which can be drawn from the new intelligence is that Stephen Wynn…has been operating under the aegis of the Genovese [Mafia] family since he first went to Las Vegas in the 1960s…”

    Scotland Yard determined that there was an especially strong relationship between Wynn’s father, Mike, and Genovese mobster Anthony “Fat Tony” Salerno. Around this time, the FBI caught “Fat Tony” on tape, in a conversation that suggested that the mobster had ties to the younger Wynn as well. Among other things, “Fat Tony” told his colleagues that they should try to get the younger Wynn to reign back his activities in Las Vegas. Wynn had become too conspicuous.

    This was before “Fat Tony” entered into jail-cell consultations with John Mulheren, the Milken crony who had sought to murder Ivan Boesky. It was after “Fat Tony” was caught on tape describing his relationship with the “feeder” who worked with Milken crony Fred Carr on the Investors Overseas Services.

    Wynn vigorously denies any connection to “Fat Tony” and the Mafia.

    By the way, “Fat Tony” wore a fedora and usually had big Cuban cigar in his mouth. These people really do exist.

    They have a certain cachet.

    * * * * * * * *

    Meshulum Riklis also denies having any connection to the Mafia.

    But he does not deny that he at one point tried to buy Investors Overseas Services. This was right about the time that Milken-crony Fred Carr began buying up shares in IOS. It was also right about the time that Investors Overseas Services was found to be the biggest Ponzi fraud in history.

    Soon after, Investors Overseas Services was handed over to a “prominent investor” named Robert Vesco, who looted it dry, and fled to Cuba.

    * * * * * * * *

    Investors Overseas Services was the biggest Ponzi scheme in history until last month, when Bernard Madoff’s Mafia-affiliated operation was revealed to be the new all-time biggest Ponzi scheme.

    Investors Overseas Services was a straight-forward swindle. Bernard Madoff’s $50 billion Ponzi was more complicated, involving not just his fund management business, but also his brokerages.

    Madoff’s brokerages engaged in naked short selling (offloading stock that had not been borrowed or purchased—phantom stock), likely on behalf of miscreant hedge funds looking to drive down prices. In fact, Madoff successfully lobbied the SEC to enact a rule that allowed market makers such as himself to engage in naked short selling. At the SEC, this rule was called “The Madoff Exception.”

    Moreover, a source who has seen some of Madoff’s trading records says that Madoff filled buy orders for stock by naked short selling the stock to his customers’ accounts. So, perversely, significant buying volume through Madoff’s brokerages in a firm’s stock would generate yet more phantom shares, putting downward pressure on the price of that stock.

    All of this naked short selling created massive liabilities (probably accounted for as “stock sold, and not yet delivered”). Those liabilities, plus the money that Madoff simply pocketed instead of buying or borrowing real stock, surely accounted for a large chunk of that $50 billion figure.

    Last summer, naked short selling (phantom stock) burst into public view as an integral factor in the implosion of the U.S. financial system. In November 2008, former SEC Chairman Harvey Pitt, echoing the words of many other experts and officials, said, “Naked short selling is what’s causing a lot of the problems in the market.”

    In other words, Madoff’s operation was not just the largest known swindle in history. It was also a phantom stock machine. And that makes it but one participant in a much bigger scandal — a crime that might have brought us to the brink of a second Great Depression.

    * * * * * * * *

    At any rate, historic achievements tend to have overlapping protagonists. So it was no surprise to learn that one of Madoff’s most important “feeders” was Fairfield Greenwich Group, part-owned by a “prominent investor” named Philip Taub. Philip’s father, Said Taub, a “prominent investor” from Europe, had been an important “feeder,” along with Michael Milken’s cronies and other people affiliated with the Genovese Mafia, for the Investors Overseas Services Ponzi.

    Another Madoff “feeder” (and a partner with Madoff in a brokerage called Cohmad) was a “prominent investor” named Robert Jaffe. Previously, while working for E.F. Hutton, Jaffe ran money for the Anguilo brothers, the Boston dons of the Genovese organized crime family.

    There was also Sonja Kohn, who was a “prominent” member of the Wall Street investment community before moving to Austria to set up Bank Medici, the primary purpose of which seems to have been to find Russian oligarchs and mafiosi (often one and the same) to participate in Madoff’s schemes.

    According to The New York Times, Kohn has disappeared. She apparently told people that she feared that somebody would have her killed.

    * * * * * * * *

    And, finally, there is the sad story of the French aristocrat Monsieur Rene Thierry Magon de La Villehuchet.

    As you will recall, this aristocrat almost single-handedly funded Leon Black’s Apollo Group. And you will remember that this aristocrat also played a key role in Black’s bid for Executive Life – a bid that turned out to be illegal, resulting in Black losing an $80 million lawsuit to the father of Deep Capture reporter Patrick Byrne.

    In later years, this French aristocrat remained one of Leon Black’s most important business associates. He was a loyal friend – a committed member of the Michael Milken network – even after Black’s Mafia business partner Felix Sater threatened to murder Patrick Byrne (This according to the courier of that threat, who quoted Felix as saying, “we’re going to fucking take it private” if Patrick continued his crusade against illegal naked short selling.).

    All of which makes it interesting to know that this French aristocrat also raised billions of dollars for the greatest Ponzi scheme the world has ever known – a Ponzi scheme that entailed illegal naked short selling that probably helped topple the American financial system.

    That’s right, Monsieur Rene Thierry Magon de La Villehuchet not only provided most of the initial funding to Milken-crony Leon Black’s Apollo Group. He was also one of the most devoted “feeders” to the Bernard Madoff $50 billion phantom stock Mafia swindle.

    And one day last month, police entered a luxurious office in a New York skyscraper. On the desk, there were pills (what kind of pills has not yet been revealed). On the floor, there was a box cutter. There was no note.

    But there he was — Monsieur Rene Thierry Magon de La Villehuchet.

    He was dead.

    They said it was suicide.

    * * * * * * * *

    To be continued….

    * * * * * * * *

    Mark Mitchell is a reporter for DeepCapture.com. He previously worked as an editorial page writer for The Wall Street Journal in Europe, chief business correspondent for Time magazine in Asia, and as an assistant managing editor responsible for the Columbia Journalism Review’s online critique of business journalism. He holds an MBA from the Kellogg Graduate School of Management at Northwestern University.

    If this article concerns you, and you wish to help, then:

    1) email it to a dozen friends;

    2) go here for additional suggestions: “So You Say You Want a Revolution?

    This post was written by:

    - who has written 91 posts on Deep Capture.


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    173 Responses to “Bernard Madoff, the Mafia, and the Friends of Michael Milken”

    1. lessthaniv says:

      Mark,

      Your podcast link doesn’t work. It appears the podango website has shut down.

      Great work!

    2. Paul says:

      Many thanks for this, Mark. Like Madoff whistleblower Harry Markopolos, you are handing the DOJ all the evidence and red flags on a “silver platter” – they just need to get off their behinds and jail these miscreants!

    3. MJK says:

      Milken’s office manager brought down 200,000 customer accounts on September 11, 2001. His friend Anthony Elgindy, a naked short that worked with the FBI shorted the airlines on September 10, 2000.

      Khashogi is friends with every president and involved with every recent financial scandal, including S&L and BCCI and the Iran Contra Affair.

      Khashoggi, along with Ramy El-Batrawi, was the principal financier behind GenesisIntermedia, Inc. (formerly NASDAQ: GENI), a publicly traded Internet company based in Southern California. After the September 11, 2001 attacks, Khashoggi’s U.S. based checking accounts were frozen and Khashoggi was unable to make a margin call with Native Nations Securities, whose CEO and largest shareholder, at the time, was Valerie Red Horse, former office manager of junk bond king, Michael Milken. In turn, Native Nations was unable to meet its obligations on it margin loan to MJK Clearing, Inc.[2][3] Trading in the stock of GenesisIntermedia was halted in September 2001. Khashoggi’s unwillingness to pay his margin loan to Native Nations Securities, and Native Nations inability to pay its debts to MJK Clearing, began a series of bankruptcies that ended in the largest payout in Securities Investor Protection Corporation history.[4][5] Native Nations Securities and MJK Clearing both eventually filed for bankruptcy.[6]

      http://www.sipc.org/pdf/SIPC_dt.PDF

      Adnan Khashoggi’s sister Samira Khashoggi Fayed was the mother of Dodi Fayed, who dated the late Lady Diana.

      http://en.wikipedia.org/wiki/Adnan_Khashoggi

    4. Craig says:

      Another stunning chapter Mark. What a service you have done for all the decent and honest individuals who try agaist such odds to make a living in the ‘market’.

      I truly hope you have some very serious and competent protection, for I am certain you have some very serious enemies by now.

    5. Paul says:

      In his testimony today, Markopolos said Madoff had Russian mob investors because of feeder fund evidence:

      http://www.youtube.com/watch?v=6Q9A1PDpg0o

    6. Wolf says:

      I just read this piece and I am stunned. I do not have the words to express the incredulity and disgust that things like this have taken and are taking place.
      There have been very, very few moments when I felt that the veil has been lifted and I can see clearly. Without exaggeration, this must be what Neo (in the “Matrix” movie) felt like when he took the pill and saw just how deep the rabbit hole goes.

      I hope and pray for justice.

      And I hope and pray for your safety and well-being.

      Thank you for your service, persistence and determination.

    7. The L1Ranger! says:

      …Shines A Totally Different Light On My View of “Current” Events!

      Now, It Wouldn’t Surprise Me To Learn That, The “Current” Occupant of The White House Was In Fact, a Plant For ‘Damage Control’ /Diversion About ALL This…

      Strangely, I Feel Like We Are Approaching a “Kings Mountain” Moment In This Sordid Story:

      http://en.wikipedia.org/wiki/Battle_of_Kings_Mountain

    8. Reporter101 says:

      The mafia have long been known to have infiltrated our markets by means of manipulation and money laundering. Lets take it one more step. What better way to cover thy tracks than to infiltrate the watchdogs of our markets? I would be curious to see how these connections reach into our regulatory agencies. We know Gary Aguirre was a straight shooter and look where that got him? Who protects the “juice” of WS and why?

      R101

    9. Anonymous says:

      A repeat, but a good one. For those that doubt the mafia’s involvement in wallstreet, scroll down to the picture of grasso, chairman of the NYSE who received a $140 million secret compensation package from the NYSE, which was supposed to be non profit at the time.

      http://www.narconews.com/narcodollars1.html

      http://en.wikipedia.org/wiki/Richard_Grasso

    10. NOYBIZNIZ says:

      Another interesting connection:

      William Ackman has a hedge Fund that is funded by Marty Peretz (who, as you have detailed, has also provided funding for Cramer and Steinhardt). Ackman has been very vocal in their short selling attack on companies like MBIA and Ambac. Both of these companies have appeared on the Reg SHO list for the past 18 months and it is obvious that have been victims of NSS. Ackman’s associate, Whitney Tilson, has alleged ties to Barry Minkow.

      Jack Byrne had a protege at Fireman Funds. His name is Jay Brown. He succeeded Jack Byrne as CEO upon his retirement from Fireman’s Fund. Jay Brown then went on to become the Chairman and CEO of MBIA.

      Coincidence? I think we have all seen enough “coincidences” to question each and every one of them…

    11. Redwood says:

      Another significant if only coincidental Khashoggi connection: Theresa LePore used to work as a flight attendant on his private jet. LePore, of course, was the elections supervisor responsible for producing the infamous West Palm Beach butterfly ballot that likely threw the 2000 election to George W. Bush.

      http://en.wikipedia.org/wiki/Theresa_LePore

      How weird does reality have to get before it’s easier to just believe in fantasy?

    12. Anonymous says:

      NOYBIZNIZ,
      And here I thought women were the ones thought to hold a grudge. This is absolutely incredible but very believable. Dot+Dot+Dot+Dot=
      Deep Capture the story
      Deep Capture the facts…….

    13. vex says:

      Great writing…I vote Pulitzer.

      Could someone make a new flow chart of the relationships? PDF perhaps. It might help the readers. People are visual.
      imho.

      Lots of details in there. You don’t have to go so fast.

      Do them slow. ;)

    14. stunned! says:

      The ball clearly now goes back into the court of the DTCC management. Will they buy-in all of these delivery failures or let the mobsters keep the money of the investors they sold bogus shares to?

    15. Sean says:

      Overstock.com downgraded to Sell at Stifel Nicolaus

      Now I wonder who owns this firm that did this downgrade? If there were only a pattern. Want to bet if we check it out it may be some parties mentioned in the above article? I willing to bet something. Any takers? LOL!! This is just incredible. Thanks again Mark and the DC gang!!!

    16. ron doc says:

      INTERESTING to notice how several of these folks with a certain ‘cachet’ also have another label planted upon them when they show up on CNBC.
      That being pronounced by one on the CNBC pocket puppets as a ‘LEDGENDARY INVESTOR’.

      I wonder if some of us common folk could not also become ‘LEDGENDARY INVESTORS’ if we also had the inside crooked control these crims have?

      LEDGENDARY my butt!

      You guys, Mitchell and Jud have ‘LEGENDARY’ courage to be doing this work!

      God bless you and keep you safe!

    17. ron doc says:

      Patrick as well on the courage thingy

    18. tkalantzis says:

      I think i saw Gary Weis’s name on Madoff’s list .

    19. rtway says:

      What a great gesture of courage and tenacity on the part of your whole team Mark. We are indebted to you and to Mr. Markopolis and can only admire the guts and talent you guys display. Thank You.
      rtway

    20. Anonymous says:

      These are the people who handle “TAXPAYER DOLLARS”

      Watchdog: Treasury overpaid for bank stocks

      By JIM KUHNHENN, Associated Press Writer Jim Kuhnhenn, Associated Press Writer – 1 hr 12 mins ago

      WASHINGTON – The federal government overpaid for stocks and other assets in attempting to help financial institutions last year, a government watchdog said Thursday, taking further issue with the beleaguered $700 billion rescue program.

      Elizabeth Warren, chairwoman of the Congressional Oversight Panel for the bailout funds, told the Senate Banking Committee on Thursday that Treasury in 2008 paid $254 billion and received assets worth about $176 billion.

      The figures were reached by extrapolating the results of a study of 10 government transactions, comparing the price paid by Treasury and the value of the asset at the time of purchase. Warren did not present details of the transactions the panel analyzed. A full report will be released Friday.

      In a bright spot for the rescue program, however, banks that received capital infusions from Treasury have already paid $271 million in dividends to the federal government. A Treasury official said Thursday that banks are expected to pay more than $1.5 billion in dividends by the end of this month. Among them is Wells Fargo, which received a $25 billion infusion. The bank announced this week it would pay Treasury $371 million in dividends.

      Still, lawmakers and watchdog groups continued to express frustration with the implementation of the rescue plan, known as the Troubled Asset Relief Program. Congress approved the plan last fall, but members of both parties criticized spending decisions by the Bush administration and former Treasury Secretary Henry Paulson.

      The misgivings come as new Treasury Secretary Timothy Geithner is preparing to place the Obama administration’s imprint on the program with a sweeping new framework for helping banks, loosening credit and helping reduce foreclosures. Geithner plans to unveil the changes next week.

      “The plan will strengthen transparency and accountability measures so that taxpayers know where and how their money is being spent and whether it’s achieving real results,” said Treasury spokesman Isaac Baker.

      Referring to overpayment on assets, Warren said Treasury has failed to specify its goals and methods in helping more than 300 institutions.

      “There may be good policy reasons for overpaying, but without a clearly delineated reason we can’t know that,” Warren said.

      Senate Banking chairman Christopher Dodd, D-Conn., said the overpayment was sure to “raise eyebrows.”

      “I can understand some gap,” he said. “No one is expecting perfection between the price you pay and what you think you’re getting. But that’s a pretty large disparity.”

    21. tommytoyz says:

      Many thanks to the entire DeepCapture team. This is outstanding work and a service to make our country and society better.

      We have to learn to stand up to this criminal influence and amoral standards, root it out and not tolerate it. No matter who the individuals are. Otherwise it creeps and grows like a cancer everywhere.

      These are definitive steps to accomplishing that and eradicating this from our society.

      Spread the word of these stories, write, call and visit your elected officials.

      Tom

    22. Anonymous says:

      ssessing the Madoff Ponzi Scheme and Regulatory Failures

      Wednesday, February 4, 2009, 9:30 a.m., 2128 Rayburn House Office Building

      Click Here To View Archived Webcast

      http://financialserv.edgeboss.net/wmedia/financialserv/hearing020409.wvx

    23. mhelburn says:

      Felix Sater changed the spelling of his name to Satter to avoid people knowing about his criminal past…

    24. Anonymous says:

      How does Mr. Tofik Arif (Russian) fit in to this story? He is the majority owner of Bayrock Group employer of Felix Sater.

    25. Sean says:

      Was my comments and questions out of line, since I see my junior blog was removed? What gives? Please let me kow if I broke any rules and what they were. Thanks in advance.

    26. Sean says:

      Until I get an answer about my missing post I will leave you guys with the best thing to happen for our cause other that Deepcapture..

      Re: Video of House Hearing on Madoff & regulatory failureHere is a C-Span link to Markopolos’s entire testimony:

      http://www.c-span.org/Watch/watch.aspx?MediaId=HP-R-15116

    27. eric says:

      Deep Capture has a stupid automated system. If you take the time to footnote your post with more than two links, the system automatically deletes it as spam.

      Whatever you do, avoid giving people links to back up your comments.

      It makes you wonder how many supporters are driven away by this arbitrary system. I was quite angry until they explained to me why my posts were taken down and put them back up.

    28. jeff says:

      Fascinating story developing!!…And to think CNBC portrays Icahn as this doer of good for public companies…I’d like the FBI to raid CNBC and start investigating their journalists…Mainly Cramer, Faber, and GAsperino…i think they may have something to say.

    29. Anonymous says:

      I encourage everyone to email Congressman Janzorski (House Finance Speaker) and Congressman Ackman regarding Deep Capture. They were very out spoken with discontent for the SEC. If you view the whole hearings, they ripped the SEC Atty and General counsel a new ArseHole. Let them know about Deep Capture. Let them see that other’s know exactly what Mr Markopolos speaks of and lend even more credibility to his testamony.

    30. Anonymous says:

      correction Congressman Ackerman. He had a friend who lost everything to Madoff and is extremely agitated.

      http://www.house.gov/ackerman/contact.shtml

      Congressman Kanjorski contact:

      http://kanjorski.house.gov/

    31. Patchie says:

      What an awesome piece of work. Thank You.

      Dave

    32. Fintas says:

      Great piece of work. I continue to pass it along to all in my network (approx 100) and to those who suggest they are concerned for the “working folk” i.e Oreilly, as well as Cavuto, Limbaugh, and while at the C.E.S recently I approached Clayton of Fox. I spent time educating him as well as giving him the info re Deep Capture. He then passed it on to Fox business producer who was on location… HOWEVER, to date..all the above have done nada although Cavuto did give Patrick some time a bit ago.And Orielly is an embarassment as he walks the thin edge as he fronts run against GE. And NO ONE calls him on it. YET none of this will accompllish ANYTHING UNTIL someone simply does their job. You are doing yours? Why isn’t Gasporino doing his and why isn’t someone calling him on it? Where are the enforcement types.. We are well past the discussion stage as we face TRILLIONS in debt and companies and the financial system collapsing. I enjoy the discussion and investigation but in the real world of producion action is required. It’s time for those out there who can do something to DO IT and stop yakking. Be Well and God Bless

    33. NOYBIZNIZ says:

      Fox Business Channel is almost as much of a joke at CNBC. Just this past weekend, who did they have on one of their weekend shows? None other than Sam Antar!

    34. Sean says:

      Eric I had no links it was just a brief comment!!

    35. GMC says:

      Buy lots of guns and ammo.

    36. ron doc says:

      GMC’ THEY ARE WAY AHEAD OF YOU ON THAT SCORE!

      http://www.govtrack.us/congress/bill.xpd?bill=h111-45

      Brought to you by the Obama Chicago machine, “Big Brother”

      Are you ready for the House Bill titled ‘HR 45, Blair Holt Licensing and Record Act of 2009′.

      It will make it illegal to own a firearm unless it is registered with the database in Washington D.C. As a gun owner you will have to be finger printed, you will be required to provide your DL#, SS#, you must maintain a valid address at all times, submit to mental amd physical health records being put on file, you will also be required to file any address changes and you must report any ownership changes even if private sale. Each update will cost $25 and if you fail to comply you will lose your right to own firearms and be subject to criminal penalties.

    37. ron doc says:

      I don’t think Congress is going to do anything about what has come out about the SEC by what Mr Markopolos revealed. He may become a target of some other Gov. agentcy is more likely IMO.

      Ask Gary Aguirre.

      Heaven forbid Mr.Markopolos feels threatened enough to arm himself for protection as that would be the perfect cover to nail him if he were in DC or NYC armed.

    38. MJK says:

      Repost, but important.

      I find it amazing the Michael Milken is tied into Adnan Khasshogi, friend of presidents and royalty and Michael Milken’s office manager was involved in the collapse of the firm holding the assets of 200,000 customer accounts and it happened on Sept. 11, 2001 and it hasn’t received any media coverage.

      Milken’s office manager brought down 200,000 customer accounts on September 11, 2001. His friend Anthony Elgindy, a naked short that worked with the FBI shorted the airlines on September 10, 2000.

      Khashogi is friends with every president and involved with every recent financial scandal, including S&L and BCCI and the Iran Contra Affair.

      Khashoggi, along with Ramy El-Batrawi, was the principal financier behind GenesisIntermedia, Inc. (formerly NASDAQ: GENI), a publicly traded Internet company based in Southern California. After the September 11, 2001 attacks, Khashoggi’s U.S. based checking accounts were frozen and Khashoggi was unable to make a margin call with Native Nations Securities, whose CEO and largest shareholder, at the time, was Valerie Red Horse, former office manager of junk bond king, Michael Milken. In turn, Native Nations was unable to meet its obligations on it margin loan to MJK Clearing, Inc.[2][3] Trading in the stock of GenesisIntermedia was halted in September 2001. Khashoggi’s unwillingness to pay his margin loan to Native Nations Securities, and Native Nations inability to pay its debts to MJK Clearing, began a series of bankruptcies that ended in the largest payout in Securities Investor Protection Corporation history.[4][5] Native Nations Securities and MJK Clearing both eventually filed for bankruptcy.[6]

      http://www.sipc.org/pdf/SIPC_dt.PDF

      Adnan Khashoggi’s sister Samira Khashoggi Fayed was the mother of Dodi Fayed, who dated the late Lady Diana.

      http://en.wikipedia.org/wiki/Adnan_Khashoggi

    39. newbie says:

      I’d say it’s just a little bit obvious why you guys were named the best business blog on the planet. Very impressive!

    40. Byrne for President; Bagley for VP says:

      More proof (as if it were necessary) of why DeepCapture is so badly needed:

      http://www.editorandpublisher.com/eandp/news/article_display.jsp?vnu_content_id=1003938623

    41. Armageddon Al says:

      One of the best articles on this subject matter in a very long time. The lines drawn between the various conspirators are exceptional. Keep up the brilliant work
      effort.
      Great job.

    42. Paul says:

      If you fast-forward through the Madoff whistleblower testimony to 1:47:30 you will hear Markopolos explain why he feared for his life and why he believed that Russian mob and Latin American drug cartels contributed to Madoff funds:

      http://cspan.org/Watch/watch.aspx?ProgramId=HP-A-40507

    43. ChippewaPartners says:

      Valerie Red Horse put together “pitch books” at Drexel Burnham. The claim that she was the office manager at the 135 South Rodeo Drive offices of Drexel should be examined closer. The SEC has the records when she took the principals exam.

      She was the Native Nations CEO. That firm contributed to the largest SIPC claim in history up to that time.

    44. MJK says:

      http://www.rgm.com/articles/sec.html

      “The first, or second, casualty was Native Nations, a small New Jersey brokerage run by Valerie Red-Horse, who served as a former office manager for Michael Milken, the disgraced junk bond financier. (Besides being a rising brokerage executive, Ms. Red-Horse, a Cherokee Indian, has appeared as an actress in such television series as “Murder She Wrote,” “Santa Barbara,” “Babylon 5,” and “Perry Mason.”)

      In the daisy chain, Native Nations received 7.2 million loaned GenesisIntermedia shares; in turn loaned the shares to the MJK; and MJK Clearing reloaned the shares to at least four brokerages. When GenesisIntermedia shares resumed after a three-day Sept. 21, 2001, closure, the stock fell, and the brokerages turned to MJK for money to cover them.”

    45. jeff says:

      someone should try and contact Jay Hoag and ask him why he left TheStreet.CON…i heard he bought in for a ten percent stake..i guess Cramer robbed that guy too…It would be interesting to hear what he has to say.

    46. jack says:

      click.file.print.distribute.repeat.
      this is soooo good… naming names, modus operandi, pieces coming together. I’m checking this site twice a day just to see if there are updates. i need more on pond. more on cerberus. more on kingsford. more on fairfax discovery. i’m in information greed mode. this should be mandatory reading for any invested or concerned citizen out there.

    47. anonymous says:

      Sender hired Pellicano. He is likely the one who hired Contigouros to undermine Fairfax. I’m guessing that maybe it is Exis that is the criminal enterprise that Markopolos is discussing with the SEC IG.

      This guy has an edge…. and it isn’t brains or hard work… he’s a crook.

      Pellicano was into prostitution… Sender in the tapes wants to see one of Pellicano’s friends.. and they talk about a pool party.. Sender is 5-4 and looks like somebody’s little brother.

      Who is Sender’s partner that Pellicano and Sender talk about? It is confusing because they also refer to Russo whom Sender was suing.

      Sender paid 800K in attorney’s fees and PI fees to get back 1.1 million that Russo screwed him out of. He eventually got 25K back and he had to testify at Pellicano’s trial.

    48. Feb14 says:

      I think this is the same network. Mark Valentine’s group was supposed to be one of three groups that worked for someone bigger and it was all about money laundering originally.

      http://www.offshorealert.com/OAShort.pdf

      It begs the question why they got such leniency and why they didn’t keep pulling on the dandelion until all the network of roots had been exposed?

    49. Feb14 says:

      Mark bragged that he personally made $850 million through a network of about 400 accounts he controlled and all he got was house arrest in his mansion in Florida.

    50. Piperdown says:

      Another Chapter for your book re: Milken & his bag of dirty tricks……look into the Milken – Dr Howard Scher – Prostate Cancer drug trials – FDA scandal that is brewing over the Dendreon-Provenge delay in 2007….there are some very interesting facts uncovered so far…

    51. Feb14 says:

      The head of one third of the network, according to rumors.

      http://www.rgm.com/articles/theriseandfall.html

    52. Anonymous says:

      If you track Milken’s other associates (Winnick, Pickens, Icahn, Turner, Murdoch, Greenberg, etc. ) the nexus is just draw dropping.

      If you want to understand the cultural, political, and economic backdrop to this story:

      http://www.kevinmacdonald.net/books.htm

    53. Anonymous says:

      Don’t forget the looting of Russia by BoNY, Al Gore, Harvard, and the oligarchs.

    54. ws says:

      Randolf Pace (firm Rudy Pace) is rumored to be running another wing of the phantom stock scam.

      Bernstein, who founded StockPatrol.com worked for Randolf.

      http://www.rgm.com/articles/nytimes2.html

    55. ws says:

      I was told Valentine ran a third, Randolf Pace ran a third and I don’t know who ran the last third.

      Only a rumor, but…

      http://www.forbes.com/forbes/1997/0224/5904114a.html

      This involves clearing customer trades, processing securities transactions and other paperwork, and providing capital necessary for smaller broker/dealers to conduct their business. A major player in the clearing business is the prestigious, publicly traded brokerage giant Bear, Stearns & Co. Inc. Guess who cleared for Baron? Bear, Stearns Securities Corp., its clearing subsidiary. And guess who figures prominently in the story? Randolph Pace, a notorious bucket-shop operator of the past, who has been the subject of numerous regulatory actions during his short career in the securities business. Pace co-owned Rooney, Pace Inc. in the 1980s.

    56. ws says:

      Big names in clearing are Pershing, a division of Donaldson, Lufkin & Jenrette; Correspondent Services Corp., a subsidiary of PaineWebber Inc.; and Prudential Securities.

      Ya, the same Donaldson who refused to investigate naked shorting when head of the SEC.

    57. ws says:

      This is all from 1997, this article is a keeper. Keep an eye on Randolf Pace and ask yourself whether or not records were destroyed when Bear Stearns went down.

      http://www.forbes.com/forbes/1997/0224/5904114a_3.html

      Bear, Stearns’ clearing subsidiary is a big player, with 2,100 customers, up from 725 in 1987. It is so big in this business that it claims to handle 12% of the New York Stock Exchange’s volume. Its clearing customers generate more than 100,000 trades every day. A decade ago its daily trades averaged 33,000. Most of Bear’s clearing clients a

      Company spokesperson Hannah Burns says: “Clearing is a very, very proprietary business for us, and we don’t want the public knowing about it.”

      A strange comment. Doesn’t the public have a right to know how its trades are handled?

      One of Bear, Stearns’ first clearing customers was Rooney, Pace Inc., a notorious stock manipulator firm shuttered by regulators in 1987. Former co-owner, Randolph Pace, is a close friend of Harriton and regularly brings new clearing customers to Bear. ;

      Right now Bear, Stearns is the clearing firm for at least 15 brokerages that are, if not full-fledged bucket shops, close to it. These include Sterling Foster, charged last September in a $53 million fraud complaint by the NASD for manipulating stock prices of newly issued stocks; Lew Lieberbaum & Co., of Garden City, N.Y.; Josephthal Lyon & Ross Inc. of New York City.

      Does having Bear as a clearing firm give cachet to smaller firms? Just ask Ian Barry, investment manager of Fiduciary Management Services, developers of Grand Bahama Island. In July 1995, Barry learned that the broker handling his client’s $2 million account was moving its back-office business from Denver-based Hanifen, Imhoff to industry giant Bear, Stearns. “I felt we were in excellent hands,” says Barry, from his office in Bermuda. “Bear, Stearns was a household name.”

      Bear, Stearns’ financials don’t specify how much its clearing business brings in.

      With reason: Why let outsiders in on how lucrative its clearing is? In 1996 Bear produced revenues of $5 billion, on which it earned $496 million. Clearing almost certainly contributed to Bear’s extraordinary results up 68% in its most recent quarter, ended December.

    58. ws says:

      Randolf Pace, steered dirty introducing brokerages, market makers and hedge funds to Bear Stearns clearing unit. Those records would all be destroyed with the Bear Stearns bankruptcy.

      http://money.cnn.com/1999/06/28/companies/bearstearns/

      Sterling Foster, which was indicted by a grand jury last year for securities fraud, is said to have underwritten six small stocks that allegedly were secretly controlled by Randolph Pace, a principal of Rooney Pace, and processed through Bear Stearns Securities. Prosecutors are investigating that matter because the stocks allegedly were manipulated and because Randolph Pace, who also was indicted in the Sterling Foster case, was barred from the securities industry at the time, the Times report said.
      Bear Stearns stock was up 3 to 44-1/4 in Monday midday trading

    59. Fred says:

      Is there any chance someone here has access to Markopolos and might get him interested in the FTD fraud? He has considerable credibility right now. Regulators and legislators fail to listen to him only at their peril, and least for now.

    60. Johntheeconomist says:

      Naked short selling is the biggest problem on wall street right now and it is what is behind MOST of the problems we are having right now. WE NEED TO PUT AN END TO IT AT ALL COSTS.

    61. Fintas says:

      Kansas City Shuffle underway? Here we are focussing on Markopolus as the SEC whistle blower of the day and the topic of Madoff. However, how many noticed that MS was able to get the spoils from C i.e Smith Barney and in the process the stock has risen from the lows of 8ish in July 08 ish to a recent 24 ish. NOT bad for a corporatoin where it’s CEO was named by another SEC whistle blower Gary Aguirre. Oh that’s right, MS CEO was determined to be a good guy and Gary Aguirre some disgruntled SEC employee. So what is the point of the comment. The games continue and as they do many a MS shareholder was fleeced at 8 and many a C shareholder is now being fleeced at 3. And what’s with FOX NEWS now doing segments on the appointment of GE’s IMMELT? Seems to me the forensic types should easily being able to track the behavior of the miscreants and GE stock. UNTIL the masses can clearly SEE then the games will continue.

    62. ron doc says:

      Names and addresses are all that is needed.

      Then maybe we can go to the end of the crooks driveways and protest, uhuh.

    63. ron doc says:

      The only links clearly brought out into the light of day for all to see would be the Congressmen and Senators since none of us can fire one single person in the SEC,DOJ, or FBI for faling to do the jobs they were paid for.

      As for the media, have you noticed how many of the news papers are going down? Seems like joe sixpack and Mary average while they may not understand what is going on, has still decided the news boys are not giving our anything anymore of any value. Most news boy frauds wouldn’t report on a bank robbery they watched and photographed as long as the bank robber threw them a few dirty dollars out in the parking lot befor speeding away in the getaway car.

      Very sad that our country has sunk to this level.

      A vicious, JUDGEMENT is coming with no mercy!

    64. ron doc says:

      sac, goldmine.

    65. stunned says:

      I guess this explains the hedge funds’ obsession with secrecy and not being subject to regulation.

    66. kersmouth says:

      Everyone is out to get YOU!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! oh my!!!!!!!!!!!!

    67. Maggie Knowles says:

      Russian mob, organized crime, Madoff, all discussed at house hearing Markopolos: http://cspan.org/Watch/watch.aspx?MediaId=HP-A-15082
      (it’s like a good album or cd, you can listen to it over and over again and get something new each time.)

      2+2 is looking more and more like 4
      ~~~~~~~~~~~~~~~~~~

      I never watched the Sopranos, probably because corruption in real life is disgusting enough.

    68. Patchie says:

      If anybody knows of the individual who sends out e-mails from the account counterfeitingstock@gmail.com, please get the message out to this fool.

      It is irresponsible to send out e-Mail rants to others and use the names of such important people as Patrick and Mark in your message if such a rant will be laced with racist remarks. This is a fight against people of small moral character and for you to bring this effort down to their level by becoming one of them is inexcusable.

      Recently you sent out such a missive to Sam Antar that was foul and racist. You provided Sam the opportunity to use your shortcomings against the highly ethical efforts of people like Patrick and Mark. He has already started posting that e-Mail on message boards as an indication of what type of character we have. If you can not clean up your act I would request that you move on to another topic of interest and leave this fight for people of a higher character.

      Dave

    69. Dont trust Dave Patch says:

      Higher character ??? sure Dave .

      Here is an email where Dave blasts Bud Burrell .

      From: Dave Patch ———->To: —————Sent: Fri, 25 Apr 2008 7:56 pmSubject: RE: The original Complaint Filed By USXP Against the SEC

      You do know Bud is about getting paid right. Quits every six months, claimsAltomare owes his money, and works closely with the stock promoters inMiami. He is close friends with Rod and yet is willing to shit on all tosound legit. Clearly Rod covers Bud’s back but not necessarily the otherway around. Bud even called me this past week and told me that he would never talk tothe OIG after they contacted him because he was too important except….theydid not contact him he initiated contact with them AFTER I was called. Budclaims he is personally threatened over and over and yet every federalperson I have spoken to have NEVER heard of him. I am not about self promotion or recognition. It is what makes meuntouchable. I could disappear in the trees and care less. Now, you want to critique my efforts have at it. But before you do makesure you have attempted to help people beyond yourself and your personalinvestment. Bet ya can’t. bet you haven’t spent the tens of thousands ofdollars or the ungodly hours of working for free to help companies andinvestors in positions you have no financial interest in. me, I amcomfortable with who I am. YOU contacted me and didn’t like the response.

    70. lenofus says:

      I see we lanced a boil. The poison is oozing out.

      You’re toast. Run and hide while you can. We won this one. Now, we get to clean up your mess. And we will.

    71. Anonymous says:

      House of Cards Collapsing….Who will be there handing down Indictments?

      http://www.nytimes.com/2009/02/09/business/09hedge.html?_r=1

      Hedge Fund Lets Investors Withdraw What Is Left

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      Article Tools Sponsored By
      By ZACHERY KOUWE
      Published: February 9, 2009

      In a move that could force similar changes at other money-losing hedge funds, the well-known fund manager William A. Ackman is cutting his fees and allowing investors to take what is left of their money from one of the funds he manages.

      Mr. Ackman, who runs Pershing Square Capital Management, is suffering huge losses on a fund he started nearly two years ago to bet solely on the rise of the stock of the discount retailer Target Corporation.

      The fund, called Pershing Square IV, is down nearly 90 percent this year, and Mr. Ackman has been feeling pressure from investors who want to take their money out. In an effort to mollify those investors, Mr. Ackman apologized for the losses in a letter sent on Sunday. He personally committed $25 million to the fund to help pay investors.

      “Bottom line, PSIV has been one of the greatest disappointments of my career to date,” Mr. Ackman said in the letter. “That said, we continue to believe that we will ultimately be successful in our investment in Target.”

      Those who want to withdraw what is left of their capital from the fund will be paid in March, Mr. Ackman said. About 90 percent of the investors in the Target fund are also investors in Pershing’s other hedge funds, which were down 11 percent to 13 percent at the end of last year.

      For those investors, Mr. Ackman has agreed to forgo any performance fees on the other funds until he makes up for the current losses in the Target fund, according to the letter. The concessions could spur other hedge fund managers to cut their fees and increase the amount that investors can withdraw. Hedge funds typically charge customers yearly fees of 2 percent of total assets managed plus 20 percent of any profits.

      Several large hedge funds, including Citadel Investment Group and Farallon Capital Management, have halted investor redemptions in certain funds after having huge losses last year.

      Mr. Ackman said in the letter that he was disappointed by the fund’s “dreadful performance,” adding, “I apologize profusely for the fund’s results to date.”
      Next Article in Business (16 of 34) » A version of this article appeared in print on February 9, 2009, on page B8 of the New York edition.

    72. ron doc says:

      DING-DONG the witch is dead, the wicked witch is gone!

      LindaThomsen out at SEC!

      Now kill off the rest of the WHORE-DOGS and I might believe!

    73. Sammy says:

      Ron Doc,

      Woohoo!

      UK Daily Mail Headline: “Bring back the guillotine for bankers”

      http://www.dailymail.co.uk/debate/article-1138673/Vince-Cable-Bring-guillotine–bankers.html

    74. Anonymous says:

      Thompson should have a job waiting for her on WS. Didn’t she stiffle the Gary Aguirre case to protect Mack? Either way, I am sure she bedded many on WS and probably can take her pick of positions.

    75. ron doc says:

      Sammy..I am conflicted…off with the head or gut em like a carp.

    76. Anonymous says:

      All Schapiro is doing is trying to move attention off of FINRA’s role, especially her role of the Madoff case and distract by claiming to clean up the SEC. She has plenty of dirt on herself to clean before she can ever think I would believe her actions at the SEC are legit. She is a snake just like all of those like her. Congress should wipe her out as a regulatory agent of any kind because she DOES NOT pass the sniff test. What a loser she is along with Thomsen.

    77. Anonymous says:

      More of the same insiders protecting insiders…Look who will replace Thomsen.Can it get more obvious?

      Former federal prosecutor Robert Khuzami

      Mr. Khuzami, currently a top lawyer at Deutsche Bank AG in New York

      SEC Expected to Name Khuzami Enforcement Director

      FEBRUARY 9, 2009
      By KARA SCANNELL
      http://online.wsj.com/article/SB123414308702261917.html#

      Former federal prosecutor Robert Khuzami will be named the new head of enforcement at the Securities and Exchange Commission as soon as this week, a person familiar with the matter said, in the latest bid by the SEC’s new chief to restore its credibility.

      Mr. Khuzami, currently a top lawyer at Deutsche Bank AG in New York, was offered and accepted the position of enforcement director, this person said. He will replace Linda Thomsen, the division’s first female director, who is expected to resign this week, the person said. A spokesman for Deutche Bank declined to comment.

      Mr. Khuzami and Ms. Thomsen couldn’t be reached for comment. A spokesman for the SEC and a spokesman for Deutche Bank declined to comment.

      The appointment of Mr. Khuzami, a respected prosecutor who served as the chief of the securities fraud unit at the U.S. attorney’s office in Manhattan, is part of SEC Chairman Mary Schapiro’s effort to reinvigorate the enforcement division. The division has been criticized for not aggressively pursuing a tip that could have unraveled the alleged multibillion-dollar Ponzi scheme carried out by money manager Bernard Madoff.

      Ms. Schapiro took steps Friday to remove the division’s “handcuffs” by ending a two-year-old pilot program implemented by former SEC Chairman Christopher Cox that required the staff to seek permission from the five commissioners before negotiating penalties. Now, as before, the staff can negotiate a penalty and bring it to the commission for final approval.

      Just 10 days into her job, Ms. Schapiro is moving quickly to fill staff positions at a critical time in the agency’s 75-year history. Friday, she named David Becker, a partner with Cleary Gottlieb Steen & Hamilton LLP, as the SEC’s general counsel, a post he held from 2000 to 2002.

      Mr. Khuzami, a Republican, spoke at the 2004 Republican National Convention on behalf of then-President George W. Bush and the Patriot Act, which gave authorities more tools to investigate terrorists but raised civil-liberties concerns.

      As a prosecutor, he oversaw cases involving the Mafia’s influence on Wall Street and gained a conviction in what was described at the time as the largest Ponzi scheme. In the case, a jury convicted Patrick Bennett for bilking 12,000 investors out of $700 million.

      Mr. Khuzami was one of three lawyers involved in a nine-month trial that led to convictions of a blind Egyptian cleric and nine others for a failed plot to blow up landmarks across New York City.

      He is taking over the enforcement division as the SEC tries to secure its existence in a broad revamp of financial regulation under study in Congress and the White House. Ms. Thomsen was a frequent target in Congress, most recently over the Madoff case.

      Her friends and colleagues say she was unfairly tarred in the financial crisis and was a victim of constraints from a less aggressive enforcement culture.

      Write to Kara Scannell at kara.scannell@wsj.com

    78. Feedchipper says:

      Below is a link to 4 1/2 hours of the House hearing on Madoff this past Wednesday. First is the terrific testimony of Harry Markopolos, followed by canned statements by five SEC jerkoffs and attempted questioning of them by members of Congress. It’s long, but not to be missed.

      http://cspan.org/Watch/watch.aspx?MediaId=HP-A-15082

    79. ron doc says:

      Anon, the more things change the more they are the same!

      Now Ob’s SEC fraud Rico/Woman is in charge inplace of the gangster Cox we know all about WHAT ‘Change & Hope’ really mean to our fli-flam man Ob!

      Here is what Ob has to say to us now he’s in that big white pad: “Hey DOPES, you drank the kool-aid, didn’t ya?”

    80. Diane says:

      Go read the DRUDGE REPORT…Madoff has made a deal with the SEC.

    81. Paul says:

      Anyone who doubts the veracity of DeepCapture’s thesis that a group of mafia-connected hedge funds who collude to manipulate stocks ought to read these two articles:

      ___ From the FBI website:
      “As a result of the [criminal] investigation, 33 people were indicted on charges of extortion, securities fraud, stock manipulation and commercial bribery. The defendants including several members and associates of the Genovese and Bonanno LCN Families, as well as the principals of Health Tech and Meyers, Pollack and Robbins. Twenty-eight defendants pled guilty and five were convicted after two separate jury trials.” Here’s the link:

      http://www.fbi.gov/hq/cid/orgcrime/casestudies/mobstocks.htm

      ___ From the Laborers International Union of North America website archive:

      “When Robert Gallo applied to be a registered stockbroker, he mentioned his only previous experience was as a labor foreman. He did not say anything about his reputed association with one of the nation’s largest crime families, New York’s Genovese clan.

      Mafia-run stock-market firms focus on violence and ripping off clients.

      Once Gallo joined the Monitor Investment Group at 20 Exchange Place, however, he acted in a manner more consistent with a character in “The Sopranos” than someone who keeps track of ‘Moneyline News Hour.’

      On June 14, Gallo was indicted along with 119 others in the biggest securities fraud case in U.S. history. Since then, law enforcement officials and financial regulators have come to believe the mob’s influence on Wall St. may be even greater than they once supposed.”

      Here is the link:
      http://laborers.org/nyd_Mob_WallSt._9-10-00.html

      A simple Google search with the keywords “bonanno genovese stock fraud” easily turned up these vivid examples of the Mafia’s involvement in stock manipulation.

    82. Sean says:

      Ron Doc, Obama should not be nor is he the object of you ire, he has nothing to do with the state of things so please take thae political bias of yours out of here and keep on topic. Here is not the place for your political rhetoric. Keep your eyes on the criminals that stole our money not our New President. Never heard you speak about Bush in this manner and I don’t wonder why!!Thank you!!!

    83. ron doc says:

      Sean, I feel exactly about Bush as Ob. Both look the other way about market manipulation and hire or keep on the same criminal regulators who seem to work only for the crooks.
      They both keep picking banksters and hedgie connections so the wolves can keep eating all us underclass as they think of us.
      Pol’s in general don’t seem to give a flat rip! That’s why the same scum stays in posts under and administration from what I can tell. Show me different if you can.

      They are all Republicrats, very little difference between any of them so if your flavor is Ob so be it but the all stink,AND AS WE NOW SEE LIE regardless of what they made you expect.

      If that offends you too bad bud, not my intention, but it is the way it is.

    84. Anonymous says:

      Sean,
      You are a prime example why they deployed 20,000 units in the USA. Most people are seeing some politicians ( both repub and Dems) for what they are…part of the problem as opposed to a solution to the problem. Someone has to control the masses when the A’politicals clash with the hard left wingers. Just the mention of Obama’s name draws you into a defensive mode. Loosen up bud, just because you are anti Obama doesn’t mean you are pro Bush either. I despise them both. Lets agree to disagree but be able to speak freely because that is our right….for now anyway. Face it, both sides have aided and abetted the collapse of America as we once knew it. Its ok to admit that. I hold people accountable for their actions, not their party affiliation.

    85. Anonymous says:

      This is GREAT ! Amen & Amen

      From:
      “Patch, David
      To:
      thomsenl@sec.gov
      Cc:
      Schapirol@sec.gov, waltere@sec.gov, aguilarlu@sec.gov, paredest@sec.gov, caseyk@sec.gov, vollmera@sec.gov, kreitmanm@sec.gov

      Linda,

      I watched the c-Span replay of the hearings held last week regarding Bernie Madoff and have a few questions I wonder if you would mind answering.

      1. You continued to refer to the fact that the SEC opened an investigation into Bernie Madoff in 2006. Can you explain what exactly transpired in the window comprising that day in 2001 when Markopolos first approached the SEC and 2006 when the investigation was initiated by the NY Bureau?

      2. A 2007 findings report out of the GAO revealed that the SEC was generally slow in closing down enforcement investigations with many cases remaining open well past the 5-year statue of limitations. Can you explain why and how an investigation of this nature was closed down so rapidly based on the allegations presented and the details provided? I can only think of one other such investigation hastily closed in recent years and that involved Gradient Analytics. Like Madoff, evidence after the fact regarding Gradient support the allegations made by Overstock.com and support allegations of wrong doing by Gradient. The SEC had sworn depositions by former Gradient employees that backed up the claims of Overstock.com and yet something motivated the commission to hastily close down that case.

      The report reveals a large number of open investigations that, though no longer active, have never been closed. According to the SEC’s internal case-tracking system, 3,700 investigations are now open. Of that number, at year-end 2006, two-thirds (2,467) had been open for two or more years, one-third (1,233) had been open for five or more years, and an eye-opening 481 had been open for 10 or more years. http://www.gao.gov/new.items/d07830.pdf

      3. You repeatedly informed the members of Congress that the people of the SEC “live to bring an enforcement case” and that “the bigger the case the better” and yet the Congressional and OIG investigations into the handling of John Mack and Pequot reveal a very different culture. A culture where “political juice” impacts the agencies motivations to bring a case forward. Do you not think that the very fact that Gary Aguirre was fired for going after a politically connected CEO factors into the energies enforcement attorneys would dedicate to similar members of society? If the Senior staff is going to terminate attorneys who go after people like John Mack, why risk your career going after a similarly respected individual in Bernie Madoff?

      4. Finally, one member of Congress asked specifically about details involving the closed investigation and referrals. With the initial investigation closed, the matter is available for public interests under the Freedom of Information Act. Details of enforcement actions, enforcement notices, and referrals is a matter of public record in a closed case and thus the Commission has no authority to deny the public or the members of Congress of this information. Would you care to delve into why you misled the members of Congress on this matter?

      I am glad your career at the SEC is being terminated. It should have taken place long ago. You have fallen out of touch with those that work within your Division and fallen out of touch with those you are required to protect – the investing public. Senior staff within the Division of Enforcement are under investigation for perjury charges in cases they brought before the courts, have been recommended for disciplinary actions relative to professionalism in the work place, professionalism relative to individuals under investigation, and for the wrongful termination of an employee. You personally were recommended for disciplinary action relative to your personal interference in a high level investigation. These allegations are not indicative of a well run division, these allegations represent a division out of control and leaderless.

      In your tenure as Director of Enforcement you set back the confidence of the investing public and the confidence of those who work within your department. I am glad you received the public flogging the members subjected you to as it has been a long time coming. You appeared arrogant and uninformed in that hearing and let the world witness such incompetence first hand. You presented to the public how many perceive many at the SEC and it was a sight Mary Schapiro will have a long time correcting.

      Best of luck to your next employer. Hopefully they will not be so delinquent in terminating such a poor performer as our federal government has been.

      Remember; you heard it here first with regards to a full in depth investigation into a captured regulator.

      Dave Patch
      http://www.investigatethesec.com

    86. Sean says:

      Ron Doc, not offended but this is not the forum for such rhetoric. Also President Obama has been in office for less than 20 days. Maybe, just maybe you can give him a chance to see if he can make a difference, they gave Bush eight years and you give President Obama 1 month!1You see where people other than myself might see some hypocrisy on your part.Now if we can point the fingers in the direction of the true criminals like Mark et al are doing I think the focus is on point. We will have to agree to disagree on this one Ron. Peace SMZ. P.S. Anonymous, I agree wholehearted with most of your statement but same is my response to you. GIVE PEACE A CHANCE!!! I trust no politicians but non of them run Hedge Funds do they? Stay on point. Focus on the real criminals and Our current President has not yet had an opportunity to make change. I think you guys are being shortsighted but this is’nt the first time and probably won’t be the last. I don’t believe either of you are being fair is my point. And we can drop this discussion as this is not the forum for it would be my other point. Again peace!!

    87. NOYBIZNIZ says:

      Sean said “I trust no politicians but non of them run Hedge Funds do they?”

      Sean, surely you can’t be serious, can you? If so, you really need to do a little more homework and connect some more dots. And when you do, be sure to remove your partisan rose-colored glasses…. you will see that the American public has been, and is being fleeced by both parties.

      Do you know how many former politicians are working in the banking system at high levels? How about Private Equity (which, in many cases, are Hedge Funds)? Do you think that these people suddenly stop talking to their former associates in government once they enter the private sector? Come on….

      And, regarding the new administration, do you really think that this “stimulus” bill is going to have a positive effect on the economy? Or result in more bureaucratic red tape and hassles for employers? Do you really think that we can spend our way out of this mess? Do you agree with Obama that “ONLY GOVERNMENT” can get us out of this mess??

      btw, this is as good a forum as any to discuss these matters. I will give Obama a chance to clean things up; but, until I see some people associated with Naked Short Selling crimes doing a perp walk, I will not be satisfied that this problem is being given the attention it deserves!

    88. Sean says:

      Noybizniz, you don’t know me or what I know or don’t so lets not go there. Your assumption that I belong to one party or another is wrong so your whole point is moot!!! Our entire Country from top to bottom is corrupt and needs to be purged and you and I bickering over nonsense on a blog designed to ferret out and expose these Miscreants is not the place or time to do such. As I said NOT THE TIME OR PLACE!!! This is my last response on this topic. Oh and one other time I AM A VERY SERIOUS PERSON!!! And this is not “our place” we don’t design the agenda here Patrick and the Deepcapture journalists do, so lets please respect them and that. Peace.

    89. Davidn says:

      “Mr. Khuzami, currently a top lawyer at Deutsche Bank AG in New York, was offered and accepted the position of enforcement director, this person said. He will replace Linda Thomsen, the division’s first female director, who is expected to resign this week, the person said. A spokesman for Deutche Bank declined to comment.”

      VERSUS

      ” May 06, 2003 (The Asian Wall Street Journal – ABIX via COMTEX)

      MJK Clearing, a US securities group, is in liquidation of holdings of 200,000 customers. Its collapse on September 11, 2001 has given rise to an unusual stock fraud case involving Deutsche Bank and Adnan Khashoggi. An ex-MJK trustee claims the defendants perverted the “short” sales system, using a chain of brokerage groups through which certain securities were channeled. No shares were sold to the public. The trustee alleges that Deutsche Bank financed the “wide-ranging and sophisticated” scheme, through which it obtained $US200 ”

      Enough said?

      Ron:

      Plus de la change, plus de la meme chose!

      The difference this time is that this time is different. The miscreants with their bought SHELBYville politicians, newspapers and TV don’t understand that we can inform each other over the internet and the right viral email can reach everyone in the country in a day or two.

      People are reading what you and I write, including powerful politicians, DOJ, regulators, miscreants, etc.

      They will lose and we will win, the only question is the date of our victory party!

      Our little snow flakes are piling up for some big plus de la change and the avalanche is coming and it is going to take the thieves off guard.

    90. Anonymous says:

      Sean,
      What you have in our government is those directly involved with corruption (the majority) and those who choose to look the other way, indirectly involved ( the minority ). This is no different than the whistle blower Marcolopos laying a white collar fraud case in its entirety in front of the SEC for years yet they looked the other way and did nothing.
      Can you not see why people are kept divided ? When the chit hits the fan and there is no food to be found, we’ll turn on each other and place blame on each other rather than put the blame where it should go, on WS and on our government. If people do not wake up and say we are Americans as opposed to party affiliations we are doomed. ( Divided we fall ) Don’t think for one minute many of those government officials sitting in their respected seats day after day and year after years are clueless as to what has happened here. They just thought they were one of the minority to take lobby money when in fact, they were a majority. The industry has used their ( ill gotten gains ) they robbed from the populace and bought and paid for the agenda’s of the criminals who paid them.
      No one can fix this mess we are in and it is time to start calling like it is….America as we knew it has been brought to her knees by ” THE LOVE OF MONEY.”
      I am an American above all and so should you be. Stay divided and we fall.

    91. ron doc says:

      Davidn, I pray you are correct. Unfortunatly in my Sixty yeasr here on this orb it seems as though there is now nothing that causes shame. In my younger years there was lots of greed and crooked activity all right, it is just that now even when it is exposed no one cares, least of all those caught red handed. And for that matter why should they care? Never are those in power or postion treated the same as the regular Joe. Now we see our new president naming people to high postions and having it revealed that they cheated on their taxes. The worst thing is they are allowed to just say “opps” and carry on only paying the back taxes and at worse the interest. Then our new, SO SMART AND DIFFERENT PRESIDENT tells us it was just a innocent mistake! Just let Joe sixpack make a ‘opps’ and the whole of the US goverment comes down like Attila the Hun and ruins his life. Oh and poor joe gets penalties on top that often equal the original tax owed on top of the original and interest.Seems joe isn’t aloowed to make any ‘INOCENT MISTAKES’ like the privvilaged big boys. How is it the supposed smartest President in years, appoints the smartest Bankster for Treasury Sec., and tells us he is the only one in the world smart enough to figure out how to get us out of the mess, and this supposed brainiac can’t even figure and pay his own taxes? I will tell you why, it is because Ob and his elites, he and all the other Pol’s, are above the law under our current situation and we can ‘HOPE’ all we like but we already know they will never feel the nead to answer to us…they have the biggest guns and army to back em up if we make too much noise.

      Sorry to be so negitive but that is what I have seen in my life and don’t believe we have any true patriotic Statesmen left in this country, or much chance of seeing the promised ‘CHANGE’ we are looking for.

      Very sad, may God have mercy on the regular people of the USA because it is too obvious that none of our so called leaders do!

    92. Anonymous says:

      ron doc,
      We have the mafia from every country in the USA, we have the worst of the worst and most dangerous drug Cartel’s ( see how the Mexican cartels have poured over into our country) and yet we have people screaming for amnesty for these very people just for their vote and controlling party interest in our government. There is no more protecting the American people as we have become the melting pot for the world, criminals and all. No more are we the proud nation our forefathers founded on their trust in God and true patriotism for the country their loved and died for so that we have a better life. Our constitution has been stripped and changed to meet the agenda’s of those elected to protect it. No more are the days that we the American people truly have a say in our country. We the people has been replaced by we the “Elite.” No more to people get down on bended knees and pray to their GOD to have mercy on our souls. For that, we have lost our way. We have lost our fight, we have lost our country.

    93. Fred says:

      Patchie

      Please cc your letter to David Kotz, IG at SEC. I believe he is one person there who is doing his job.

      We need to get him and Markopolos aware of the FTD fraud.

    94. ron doc says:

      Anon, now at my age I am amazed at the change I have seen. Maybe that is why the change guy scares me so much. As for older Americans it looks like we are moving to the UK and Canadian model of care…if your old and it costs more then you are deemed to be worth then go home and die. Unless you a former President or Government biggie.

      I have a friend in Vancouver Canada who’s fater after waiting over six months to recieve a EMERGENCY open heart surgery finally was in the hospital, shaved, preped and on a line when the Dr. came in and informed him that to many people had been lined up for the same surgery that day and he would have to go back home….He was the oldest…you know the end of the story. Now Ob is going to do us the same. Some change and hope eh? Of course the Big boys will be able to opt out, just like they don’t have to be bothered with a SS system like the little folk…Oh no, they get retirement treatment like kings….I guess we just didn’t get the notice of the crowning.

      From this:

      http://www.bloomberg.com/apps/news?pid=20601039&refer=columnist_mccaughey&sid=aLzfDxfbwhzs

      Elderly Hardest Hit

      Daschle says health-care reform “will not be pain free.” Seniors should be more accepting of the conditions that come with age instead of treating them. That means the elderly will bear the brunt.

      Medicare now pays for treatments deemed safe and effective. The stimulus bill would change that and apply a cost- effectiveness standard set by the Federal Council (464).

      The Federal Council is modeled after a U.K. board discussed in Daschle’s book. This board approves or rejects treatments using a formula that divides the cost of the treatment by the number of years the patient is likely to benefit. Treatments for younger patients are more often approved than treatments for diseases that affect the elderly, such as osteoporosis.

      In 2006, a U.K. health board decreed that elderly patients with macular degeneration had to wait until they went blind in one eye before they could get a costly new drug to save the other eye. It took almost three years of public protests before the board reversed its decision.

      Hidden Provisions

      If the Obama administration’s economic stimulus bill passes the Senate in its current form, seniors in the U.S. will face similar rationing. Defenders of the system say that individuals benefit in younger years and sacrifice later.

      The stimulus bill will affect every part of health care, from medical and nursing education, to how patients are treated and how much hospitals get paid. The bill allocates more funding for this bureaucracy than for the Army, Navy, Marines, and Air Force combined (90-92, 174-177, 181).

      Hiding health legislation in a stimulus bill is intentional. Daschle supported the Clinton administration’s health-care overhaul in 1994, and attributed its failure to debate and delay. A year ago, Daschle wrote that the next president should act quickly before critics mount an opposition. “If that means attaching a health-care plan to the federal budget, so be it,” he said. “The issue is too important to be stalled by Senate protocol.”

      More

    95. NOYBIZNIZ says:

      It seems Sean is A VERY SERIOUS PERSON. Therefore, no one should disagree with him, since he has declared that this is not the time or place.

      ROTFLMAO

    96. Sean says:

      Cramer Schools the SEC
      Cramer says if the SEC wants to restore our lost faith in the market, it must bring back the uptick rule, put an end to the naked short-selling and bear raids, ban the ETFs of mass destruction, and get serious about enforcement.

      http://www.cnbc.com/id/15840232?video=1029422664&play=1

      Think he could be trying to reduce his Jail sentence? LOL!!!

    97. Sean says:

      A dose of reality from experienced and knolwedgeable people that also called this nightmare that we are in way in advance and they are still being ridiculed by the snobbish idiots at CNBC. They will eventually get theirs.. just a matter of time!!

      http://www.cnbc.com/id/15840232?video=1027496846&play=1

    98. Anonymous says:

      Sean,
      After viewing that video, what I did get from the speakers was spot on. What I also got from the CNBC anchors was rudeness, interruption of the guest and trying to change the topic from the criminals that got us into this mess to investment advice. It is obvious these CNBC guy are just too smuckin’ fart in their own minds. I am just thankful these gentlemen were able to speak about what they know and what we know to be true between interruptions.

    99. Patchie says:

      In 2006, Don’t Blame the Shorts
      By James J. Cramer
      RealMoney.com Columnist
      12/30/2005 9:50 AM EST

      Perhaps the most over-observed, over-chronicled and falsely over-weighted topic on Wall Street these days is naked shorting.

      First of all, you should almost never care about this process if you are a business person. If you are running a company and you are targeted by short-sellers, it’s usually because you deserve it. I don’t mean to be literal, but most of the short-sellers I know are smarter than the long buyers, and they are in a tough profession because the rules are so against them that it is barely worth trying to make money that way. So, they go after their targets carefully, because stocks can go up to infinity if you short them, but they stop, mercifully, at zero if you buy them.

      Second, the concept of not finding shares before you short them, not locating them, is something that happens very rarely, and when it does, you tend to get bought in and lose everything that you might have made.

      Yet, there is this whole cottage industry of people who know nothing about the mechanics of Wall Street, meaning people who have never spent time in margin, in reconciliation, in the cage, in stock loan, and don’t know how things work. They keep writing and talking as if having no such thing as naked shorting would make the world quite different and more positive.

      What a bunch of hooey!

      To refresh, when you short, you need a locate; that is, you need to find the shares that you are going to borrow to sell. If you don’t get a locate, or even if you get a locate and then the stock becomes overshorted, meaning too many shares are short vs. the float, you can be subject to being bought in.

      I used to short stocks all the time the right way. I first would get a locate from one of many of the places I had accounts, and then I would sell the stock short. But so often, others would join the short and I would be told that the stock could no longer be borrowed even though I had gotten the locate ahead.

      Then, the games begin. You have to beg not to be bought in. You have to plead. And in the end, it doesn’t matter. Someone has bought the stock and takes the shares out of the vault so he needs them physically. (That’s usually a sign that management has “figured the game out” and told everyone to get the stock out of “Street name” so it can’t be borrowed so a squeeze can occur.)

      I have been “bought in” numerous times. You don’t even know you are being bought in when you are, and you are not subject to time and sales requirements, meaning that you can be bought in at any price the desk that needs the stock sees fit. I got bought in on National Community Bank of Rutherford 8 points higher than the stock was trading. That’s allowed. That’s part of the long-side rigging that makes all of this squawking about naked shorting such a joke. But that’s probably because the squawkers have no idea how the process works.

      Anyway, suffice it to say that the shorts, in the end, have very little power to manipulate down, to control the situation or even to influence the situation. But there are always managements eager to deflect the core weakness of their own businesses by suggesting that naked shorting is behind their demise. What a joke.

      The reality is that there are about four or five good short-selling firms, and they could be wiped out if any of the companies they are shorting turn out to be real and good and capable of sustained growth.

      I don’t want to waste a lot of your or my time in 2006 talking about the powerful short-sellers. They are a myth. I do want to wage a campaign against the shorts’ foes though, because without the shorts, how would we discover the frauds like Enron and WorldCom? You believe the sell-side research people will uncover them? The government? The ratings agencies? The rank-and-file media?

      Give me a break.

      And get off the backs of the shorts. They aren’t worth your attention.

      Random musings: Syneron Medical (ELOS:Nasdaq) is under a lot of pressure. Glad I got off that horse at a high. … A big welcome to Commerce Bancorp (CBH:NYSE) , TheStreet.com’s new neighbor; a new branch just opened down the block from our offices. At last, I can move my stuff there so I won’t be treated like a non-entity as I am at my current bank, which will go nameless.

    100. Bond, James says:

      http://www.google.ca/search?hl=en&q=fail+to+deliver+us+treasuries&btnG=Google+Search&meta=

      Patchie, I think they got too greedy when they started naked shorting debt.

      The interest rates on government bonds are set by supply and demand and by naked shorting the bonds, the 17 slimy prime brokerages were able to borrow trillions at government interest rates.

      Not only are they ripping off the borrowers, but they are forcing the taxpayer to pay higher interest on government debt.

    101. Sean says:

      What a collaboration this could be Michael Moore ands Deepcapture..

      This Could Be Interesting: Michael Moore is Making a Film about Wall Street
      http://www.michaelmoore.com/words/message/index.php

      Will You Help Me With My Next Film? …a request from Michael Moore
      February 11, 2009

      Friends,

      I am in the middle of shooting my next movie and I am looking for a few brave people who work on Wall Street or in the financial industry to come forward and share with me what they know. Based on those who have already contacted me, I believe there are a number of you who know “the real deal” about the abuses that have been happening. You have information that the American people need to hear. I am humbly asking you for a moment of courage, to be a hero and help me expose the biggest swindle in American history.

      All correspondence with me will be kept confidential. Your identity will be protected and you will decide to what extent you wish to participate in telling the greatest crime story ever told.

      The important thing here is for you to step up as an American and do your duty of shedding some light on this financial collapse. A few good people have already come forward, which leads me to believe there are many more of you out there who know what’s going on. Here’s your chance to let your fellow citizens in on the truth.

      If you have any info that would help, please contact me at my private email address: bailout@michaelmoore.com.

      For the rest of you on my email list who don’t work in the financial industry, you’re probably wondering, “What the heck is this all about? I thought he said he was making a romantic comedy!”

      Well, I just can’t say much right now. I’m sure you can understand why. One thing I can tell you is that you’re gonna like this movie when I’m done with it. Oh, yeah…

      So, again, if you work for a bank, a brokerage firm or an insurance company — or if you have seen things or heard things that you believe the American people have a right to know — please contact me at bailout@michaelmoore.com.

      Thank you in advance for your help!

      Yours,
      Michael Moore
      bailout@michaelmoore.com
      MichaelMoore.com

    102. iStandUp says:

      James Bond, thank for the link!

      Here is a story that sounds like it was written by DeepCapture.com writers:

      FINANCE-US: Treasury Nominee Failed to Halt Bond Scam
      By Lucy Komisar*

      NEW YORK, Jan 19 (IPS) – U.S. senators at Timothy Geithner’s confirmation hearing for Treasury Secretary Wednesday may want to ask him about a failure to act that is costing the U.S. a lot more than the amount he evaded on taxes.

      The Federal Reserve Bank of New York, which he has led since 2003, conducts the operations on Wall Street of the Federal Reserve Bank in Washington, the country’s central bank. The New York Fed under Geithner’s presidency has failed to stop massive naked short selling of U.S. Treasury bonds that threatens the stability of the market and sale of the bonds.

      Ironically, the scam, enabled by a lack of regulation at the behest of Wall Street brokerage houses, makes it more expensive for the U.S. to bail out those same financial institutions.

      It happens this way: an individual or fund is allowed to sell bonds without owning them. This is called short selling. The seller, whose broker has generally “borrowed” bonds from another broker, is supposed to subsequently buy them on the market, and return them to the lender. The seller does this because he believes that the bond is going down, and he will buy them at a cheaper price than he sold them for.

      Naked short selling occurs when a seller does not borrow the bonds for delivery at settlement, and therefore never has to buy them. This is called a failure to deliver, or FTD.

      Meanwhile, the buyer thinks he or she has the bonds but has just an IOU. The result is a distortion of the market. Sellers sell bonds they never own or borrow, so there are more securities sold than issued by the government. These phantom bonds don’t represent money paid to the U.S. Treasury or genuine securities for buyers.

      The major broker-dealers who handle bond trades like the system. They profit from fails by using clients’ money for other purposes.
      …….”

      ( http://www.ipsnews.net/news.asp?idnews=45472 )

    103. Sean says:

      This is getting more criminal by the day!! Is there no shame!!
      http://www.huffingtonpost.com/jonathan-tasini/the-greed-continues-121-m_b_165925.html

      One beneficiary was Peter Kraus, a Thain hire who started at Merrill in mid-September and quit Dec. 18, the day Bank of America took over.

      He walked away with a $24.9 million bonus for those three months of work, which figures to about $249,000 a day. The day he quit, his wife closed on a $36 million luxury Park Ave. co-op, records show

      I know: when you get almost $25 million for three months work, it might be tough to get by on just $500K. According to this story, the bonus was given, despite the fact that Merrill had just recorded a $15 billion LOSS in the fourth quarter because it was guaranteed in his contract.

      Thain was just looking out for his boys. I wander if this Kraus guy worked for Goldman at one time?? I will venture to guess yes!!!

    104. kevin says:

      Thanks for the Moore link. We should all email him links on this on a regular basis as good stuff comes up in the comments.

    105. Sean says:

      I have said this before , sometime last month to friend of mine “All Hedge Funds” are probably ponzi schemes…

      This is Huge: Markopolos’ 2nd Shoe Drops
      Whistleblower Alleges $8 Billion Fraud At Sir Allen Stanford’s Offshore Bank

      This will be interesting to watch: A whistleblower named Alex Dalmady claims that Stanford International Bank, a large offshore operation run by Texas billionaire Sir Allen Stanford, is an $8 billion fraud, with suspiciously steady year-on-year returns, a la Bernie Madoff.

      http://www.businessinsider.com/whistleblower-alleges-8-billion-fraud-at-sir-allen-stanfords-offshore-bank-2009-2

      & for those unfamiliar with sir allen, he was welcomed like the 2nd coming on cnbc this past year :

      http://www.cnbc.com/id/15840232?video=739904675

      Looks like I may have been right on target!!!

    106. Anonymous says:

      Sean,
      The whole market and our economy is a Ponzi scheme. Whats to say that every bank pays inrerest to older members by new members accounts? We are neck deep in the largest unregulated fleecing of America and many other countries by the gangsta’s,banksta’s, mobsters,hedgesters,regulatsters, government backsters,Illuminati wanna be crookster…….. CRIMINALS,

    107. ron doc says:

      Sean, CNBC…AKA….CrimeNBC

      These CNBC folk are just Gangsta water boy Hoe’s!

      You wonder how they always label the crooked as a pan of guts scum they have on as ‘LEGENDARY’

      Before this is done sweet Becky Q. might find Warren Buffet not taking her calls. A real legend of a investor like Buffet has got to be starting to wonder about CNBC.

    108. g2nosis says:

      Many thanks. Mark. We are in real need of journalists like you.

    109. kevin says:

      For those that missed it, Sean has an email address for a new Michael Moore movie on Wallstreet scams.

      Send links to:

      bailout@michaelmoore.com

      to be investigated for the movie

    110. DTC _ Enema Time_ Yes? says:

      Oh Yes, another huge wave of crappy kitchen sink CDO Cubed / CDS bets with credit cards debt, car loans and any other debt these MONSTERS could find to securitize.

      Ben B’s face said it all “systemic risk,moral hazard and the deaf dumb and blind SRO’s have led the System into a deflationary vortex.

      Our Governments answer _ Print more money, Borrow more money .

      The course is set.

      Having learned how to securitize and sell US risk exposure for profit, the mechanics must now securitize and sell anti-inflation products! HA!

    111. Here, there,everywhere a ponzi says:

      Oh Yes, another huge wave of crappy kitchen sink CDO squaed and cubed / CDS bets with crappy credit cards debt, car loans and any other consumer debt these MONSTERS could find to securitize.

      Ben B’s face said it all….. “systemic risk,moral hazard and the deaf dumb and blind SRO’s have led the System into a deflationary vortex.

      Deflation is very dangerous.

      Our Governments answer _ Print more money, Borrow more money .

      The course is set.

      Having learned how to securitize and sell US risk exposure for profit, mechanics must now invent, securitize and sell anti-inflation products! HA!

    112. Bond, James says:

      Am I the only one that thinks it is ridiculous that someone can counterfeit government bonds and not go to jail?!?!?!?!

      http://www.google.com/search?hl=en&q=fail+to+deliver+us+treasuries&btnG=Google+Search&meta=

      Shite – they are literally printing IOU’s for bonds, lying to their customers and keeping the money at low interest rates.

      How crooked does it have to get before the media talks about it?

      The interest rates on government bonds are set by supply and demand and by naked shorting the bonds, the 17 slimy prime brokerages were able to borrow trillions at government interest rates.

      Not only are they ripping off the borrowers, but they are forcing the taxpayer to pay higher interest on government debt.

      Am I living in bizarro world? This cognitive dissonance has wakened me from my slumber and I’m pizzed off.

    113. Anonymous says:

      Fraud ‘Directly Related’ to Financial Crisis Probed
      FBI Agents Could be Reassigned from National Security Due to Booming Caseload

      By JASON RYAN
      Feb. 11, 2009—
      http://abcnews.go.com/TheLaw/Economy/story?id=6855179&page=1

      The FBI has opened investigations into more than 500 cases of alleged corporate fraud, including 38 that involve major firms and are “directly related” to the national economic crisis, FBI Deputy Director John Pistole told Congress today.

      The surge in white-collar investigations is putting such a strain on the FBI that Pistole said the bureau is considering reassigning agents from national security, which has been the bureau’s priority since the 9/11 attacks.

      “The FBI has more than 530 open corporate fraud investigations, including 38 corporate fraud and financial institution matters directly related to the current financial crisis,” Pistole told the Senate Judiciary Committee today.

      The 38 companies, he said, “are significantly large companies, businesses everyone knows about but I cannot comment publicly.”

      Pistole’s comments suggested widespread criminal activity among many of the nation’s corporate giants.

      “These are significantly large, similar to Enron,” Pistole said. The number of firms under scrutiny could eventually top 100, as the investigations widen, he said.

      Only one major criminal case has come from the FBI’s investigation of the major subprime lending outfits, when two Bear Stearns hedge fund managers were indicted in May 2008 on fraud, conspiracy and insider trading charges. They were the first executives to be charged as a result of the FBI probe.

      The two hedge funds in question were heavily invested in subprime lending and debt obligations connected to risky subprime mortgages that lost $1.8 billion in 2007.

      “These corporate- and financial institution-failure investigations involve financial statement manipulation, accounting fraud and insider trading,” Pistole said.

      Large firms such as AIG, Countrywide Financial, Washington Mutual, Bear Stearns, Lehman Brothers, UBS AG, New Century Financial, Freddie Mac and Fannie Mae have been targets of FBI and Justice Department investigations, according to federal law enforcement officials and Security and Exchange Commission filings reviewed by ABC News.

      The amount of corporate fraud “dwarfs” the Savings and Loan scandal of the 1980s, Pistole told the committee.

      “I don’t think we’ve paid enough attention to the mortgage and financial fraud that have so dramatically contributed to the economic downturn,” Senate Judiciary Chairman Patrick Leahy, D-Vt., said. “It is now becoming clear that unscrupulous mortgage brokers and Wall Street financiers were among the principal contributors to this economic collapse.”

      “I want to see people prosecuted&Frankly, I want to see people go to jail,” Leahy said of suspects in mortgage fraud schemes.

      More FBI Agents to Probe Financial Fraud?

      Officials say the corporate greed continues. Neil Barofsky, the TARP special inspector general, testified that there are several criminal investigations of fraud related to TARP, which handed out $350 billion in the last days of the Bush administration to prevent the nation’s economy from collapsing.

      He made reference to one TARP probe that shut down “a securities fraud scam in Tennessee that reaped millions in ill-gotten gains by illegally trading on the TARP name.”

      In addition to major corporate fraud, Pistole testified that the number of mortgage fraud cases investigated by the FBI has risen from 881 in fiscal year 2006 to 1,600 in fiscal year 2008.

      “The increasing mortgage, corporate fraud and financial institution failure case inventory is straining the FBI’s limited white-collar crime resources,” he said.

      During the height of the S&L crisis in the 1980s, the FBI had 1,000 agents working on various task forces. With the focus on national security investigation after Sept. 11, the FBI today has only 240 agents working on mortgage-fraud related matters.

      “The 240 agents now are working very hard&we are looking to see if the agents on national security could move over without jeopardizing national security,” Pistole said.

      Barofsky said extra measures will be needed as another $350 billion of TARP money is being released along with funds from an $800 billion economic stimulus package currently being hammered out in Congress.

      “Unfortunately history teaches us that an outlay of so much money in such a short period of time will inevitably draw those seeking to profit criminally& It is essential that the appropriate resources be dedicated to meet the challenges deterring and prosecuting fraud in connection with these programs,” Barofsky said.

      The hearing was held to review legislation sponsored by Sens.Leahy and Charles Grassley, R-Iowa, to give more resources to federal investigators. Barofsky currently only has around four FBI and IRS agents to oversee how $700 billion is tracked. The FBI Deputy Director, TARP IG Barofsky and the acting head of the Justice Department Criminal Division will be asking for more resources and authorities to hire fraud prosecutors and investigators at the Department of Justice and the FBI.

      “We’re going to see demand on federal law enforcement really increase,” said Rita Glavin, acting head of the Justice Department’s criminal division. Glavin said that the Justice Department is currently reviewing establishing a national mortgage fraud task force.

      http://abcnews.go.com/TheLaw/Economy/story?id=6855179&page=1
      Report TOU Violation

    114. Anonymous says:

      While the FBI presses forward to build cases against major financial institutions, the SEC can only look the other way because there is “TOO MUCH JUICE” to handle. This truly shows the SEC needs to be dismantled and done away with. The Market Cops are worthless and the FBI has to do the SEC’s job. The FBI needs funding to add additional investigators yet the SEC in all their glory just can not do the job it was designed to do. In light of this, if the FBI is doing the job of the SEC I say GET RID OF THS SEC and FINRA. Totally worthless and a waste of tax payer dollars.

    115. FBI hot pepper says:

      baking spice……..
      Patrick Byrne, tabasco sauce, habaneros, cinnamon and spice and everything nice. Until you F___ with him.

      Change you can believe in.

      was: “Life is like a box of chocolates”

      now: “Life is like a hot pepper, what you did
      yesterday will burn your ass today”

      Thrill me with passion….. cinnamon. Be my Valentine.
      your friend, fbi hot pepper sauce.

    116. clearthinker says:

      you know, the thought crossed my mind today as we celebrate the birthday of Linccoln…maybe the answer is just to let the country sink to a level so low that it has no choice but to clean itself up in order to survive. Clearly, the bailout shows we are not there yet. They will print the money, and interest rates will skyrocket in the coming months and years. The media is not even close to talking about the FTD problems in the system – it’s all CDO’s and mortgages and too much easy money…not a single major media outlet is even talking about the FTD’s in the bond markets…

      Sure, we’ve come some to get Cramer to talk about naked shorting on Mad money, but his rhetoric is as much about covering himself from years of questionable behavior and making horrid market calls. He needed a scapegoat, and the naked shorting makes him appear to be a victim…how convenient.

      Until enforcement re-issues the subpoenas to Cramer, Greenberg and Remond, until we see some news about Refco (funny how that just kinda went away, isn’t it?), until we see arrests for the manipulative naked shorting that accelerated the price declines in the bear market of 2007-8 and beyond….

      What has been accomplished? A lot of venting, a lot of letter writing, a lot of “guns and badges – any minute”….

      Well any minute turned into any month, into any year and will soon turn into – “let’s focus on the future” …..

      Believe it – it’s the American Way…..obfuscate the truth until no one wants to hear it any more……

    117. mhelburn says:

      Grassley is on the job. The Senate enforcement hearing is worth a listen.

      I particularly enjoyed the part @1:08.45 dealing with the unregulated part of the market and the tools that the enforcement people already have to deal with that fraud. http://judiciary.senate.gov/hearings/hearing.cfm?id=3651

    118. Anonymous says:

      I guess Wacky Patty is not so wacky after all…..The house of cards is collapsing….

      FEBRUARY 13, 2009
      By TOM MCGINTY and KARA SCANNELL
      http://online.wsj.com/article/SB123449787320481341.html#

      The Securities and Exchange Commission is investigating whether several hedge funds traded improperly after being given advance notice by a research analyst of his negative report on a prominent insurer, people familiar with the agency’s investigation said.

      The investigation comes amid a civil-court case brought by the insurer, Fairfax Financial Holdings Ltd. That case, filed in a New Jersey state court in 2006, unearthed documents indicating that executives at the hedge funds discussed the coming report of the analyst and made bets that the company’s stock would decline.

      Companies routinely bar analysts from distributing reports to investors before publication to prevent the trading of nonpublic information. Analysts who give out information that isn’t public but is market-moving and violates company policy can violate the securities laws. It also is improper for investors to trade using information that they know they’ve received improperly.

      In the civil suit, Toronto-based Fairfax alleged that the hedge funds, the analyst and his firm conspired to profit by driving down the company’s stock, which is listed on the New York Stock Exchange. The suit alleges that SAC Capital Advisors, Third Point LLC, Kynikos Associates LP and others acted together, paying the analyst, his investment firm and other defendants in the suit to spread false and defamatory information about Fairfax from 2002 through 2007.

      The hedge funds have denied wrongdoing in the civil suit. An SEC spokesman declined to comment.

      The SEC investigation underscores the heightened scrutiny of hedge funds these days, particularly those that were active betting on stock declines amid the market panic last year. And the issue underscores a broader dilemma: Though hedge funds often provide early warning signs of problem companies — they highlighted accounting problems at Enron Corp. and others earlier this decade — they also often are accused of overly aggressive tactics.

      At issue in the civil suit and the SEC investigation is a research report by analyst John Gwynn of Morgan Keegan Inc., a Memphis, Tenn., investment firm. Mr. Gwynn initiated his coverage of Fairfax on Jan. 17, 2003. His report said Fairfax was $5 billion short of the reserves it should have been holding to cover potential insurance claims, and rated it “underperform.” It also said the company’s strategy of acquiring troubled property and casualty insurers had backfired, saddling the company with assets that would have to be written down, potentially erasing most of shareholders’ $2 billion of equity in the company.

      Fairfax’s shares fell 13% the day Mr. Gwynn’s report was released and slid to a two-day loss of 20% the next trading day, closing at $59.30. (Fairfax’s stock closed Thursday at $318.11 a share.) Mr. Gwynn issued a revision 13 days after the original report that reduced the reserves shortfall to $3 billion.

      Morgan Keegan, a subsidiary of Regions Financial Corp., fired Mr. Gwynn in August 2008 for what it claims was the advance disclosure of the timing of the report and what his recommendation would be, the company said. Morgan Keegan said it stands by the content of Mr. Gwynn’s report. Mr. Gwynn didn’t return requests for comment.

      Documents in the case reviewed by The Wall Street Journal, primarily emails and instant messages submitted as exhibits by Fairfax, show that some of the hedge funds knew of Mr. Gwynn’s report more than a month before it came out.

      On Dec. 11, 2002, a Kynikos Associates executive wrote the hedge fund’s founder, James Chanos, saying he had heard from another hedge fund that Mr. Gwynn was going to issue a research report rating Fairfax stock “underperform” and warning about a reserves deficiency, according to a court exhibit.

      A week later, Mr. Chanos forwarded an email to Jeffrey Perry at SAC Capital Advisors, a New York hedge fund founded by Steven Cohen. The email, written by another Kynikos employee who said he had talked to Mr. Gwynn, said the analyst “was more critical of [Fairfax] than I’ve ever heard a sell side analyst … everything from underwriting to accounting to honesty,” according to a court exhibit.

      On Jan. 16, 2003, a Kynikos executive wrote Mr. Chanos, saying he had just talked with Mr. Gwynn. “[H]is piece that rips FFH [Fairfax] apart is supposed to be published tomorrow. Should be interesting to see how the street reacts,” he wrote, according to a court exhibit. The report was issued the next day.

      Trading records obtained by Fairfax through discovery in the lawsuit show that Kynikos put on a $5 million “short” position, or a bet against Fairfax shares, in the month after Mr. Chanos learned of Mr. Gwynn’s report, including $2.5 million the day before the report came out, a Fairfax attorney, Michael Bowe, said during a September court hearing.

      Kynikos attorney H. Peter Haveles Jr. disputes that account. He says Kynikos reduced its short position after receiving information about Mr. Gwynn’s views in mid-December and increased its Fairfax short position by “a modest amount” on Jan. 16, but did so before the email about the report’s pending release. He declined to provide specific figures, and the trading records aren’t part of the public court file.

      On Jan. 14, three days before the release of Mr. Gwynn’s report, an SAC Capital executive sent an internal email to Mr. Cohen and others, outlining coming events for that week, according to a court exhibit.

      One line read, “Morgan Keegan expected to launch on Fairfax with Sell rating — we will be covering into this.” “Covering” typically refers to closing out short positions by buying shares and returning them to the owner who loaned them to the short seller. Fairfax contends that SAC locked in gains as the stock got hit in the wake of the report.

      SAC attorneys have offered a different explanation. They have contended that documents in the case not made public show SAC was buying stock in the period leading up to Mr. Gwynn’s report — exactly the opposite of what it would have been doing if it were trying to capitalize on advance knowledge of Mr. Gwynn’s views.

      SAC declined to comment for this article.

      Trading records also show that another defendant in the civil-court case, hedge fund Third Point, shorted $1.5 million of Fairfax shares the day before Mr. Gwynn’s report was issued, Fairfax attorneys said during the September hearing. The Journal isn’t aware of any emails filed with the court by Fairfax showing that Third Point communicated with Mr. Gwynn or the other hedge funds before the report was released.

      In July 2008, Third Point CEO Daniel Loeb said in a letter to his investors that the SEC had begun a formal investigation into Third Point’s communications with portfolio managers at other hedge funds, according to a copy of the letter reviewed by The Journal. The letter didn’t indicate that the inquiry was related to Fairfax.

      Write to Kara Scannell at kara.scannell@wsj.com

      http://online.wsj.com/article/SB123449787320481341.html#

    119. Diane says:

      You should start a new website and call it something like ” We call naked shorting on YOU”. Put adverts in WSJ to alert CEOs of corporations, link it to deep capture, and watch the squirming begin.

    120. Sean says:

      I have a simple qustion. If all these articles being put out by Deepcapture are false and libelous(sp) would’nt or should’nt some have sued DC by now? I mean we are mentioning some very powerful names and journalists here are’nt we? Then where are all these blustering windbags? Something tells me they are scared of this site. I wonder why?Comments anyone?

    121. Fred says:

      The WSJ article on the Fairfax case is huge. It is the first time in a long time I recall a major mainstream paper cover one of our favorite stories. Let’s keep reminding them of the FTD problem.

    122. Boo says:

      It makes you wonder what arrogant forces we are up against when someone can sell PHANTOM BONDS where this COUNTERFEIT debt competes directly against Uncle Sam for investor dollars and not one person in the media sez boo about this ARRESTABLE CRIME, not one politician sez boo, not one cop pulls out the handcuffs and if you bring it up in polite conversation, people think you are a tin hat wearing conspiracy theorist.

      If you want to ask the secret service why they don’t investigate this COUNTERFEITING of government debt, you can reach them here:

      http://www.ustreas.gov/usss/contact_usss.shtml

      WTF?!?

      http://www.google.com/search?sa=N&tab=nw&q=%22failure%20to%20deliver%22%20%20bonds

      This is no longer about naked shorting of stock, the whole clearing system for everything is corrupt to the core.

      Down with the DTCC!

    123. mhelburn says:

      I am astounded with the idea of throwing money at a problem without investigating the problem first.

      We’ve had money going offshore for decades and not being taxed or accounted for. Major banks have helped do this. Same banks who now face the problems they created as if they aren’t culpable.

      Unregulated areas of the economy that the taxpayer is underwriting. Same banks involved.

      Banks and mortgage people lobbying for deregulation and when it blows up, they blame a bunch of people who were never qualified to pay back loans that they made. Same banks involved.

      Without cleaning up regulation, the lawmakers are tossing money around as if that is going to solve anything. Meanwhile, has any problem area been addressed? Extend unemployment to keep people from starving. People moving out of homes and leaving communities with blight.

      It took about 6 years for the consequences of the deregulation to really wreak havoc in in the economy.. and it will take at least twice that long to rebuild anything. And we now have a massive debt to deal with. And more and more money going out instead of curtailing spending.

      Folks, this problem is so gigantic that a change of administration isn’t going to fix it by chanting “change”. Spending isn’t going to fix it and that is what is happening. We have a reprieve of two years that we don’t have to listen to the campaign rhetoric, but in a few short months it will all start up again. Obama won’t be able to fix this, but he is trying to control the census so that he can remain in power.. Watch out. No productivity, just welfare that is dependant on handouts which will keep this bunch in office.

    124. Anonymous says:

      Did someone say “NAKED” again?

      http://www.youtube.com/watch?v=x_xYvV2YeT8

    125. Anonymous says:

      RESTORING INTERNATIONAL CONFIDENCE IN AMERICAN MBS/CMBS/ABS
      INVESTMENT SYSTEM
      BY: CHRISTOPHER JARED WARREN
      http://tinyurl.com/dllfjj

    126. iStandUp says:

      Anonymous 139.

      Thanks!!! It is good to see a law professor explaining the naked CDS to the committee, and how the American people are paying for the “liquidity” of the Naked Shorts!

      Michael Greenberger – House Agriculture Committee on Derivatives Legislation 2/4/09

      http://www.youtube.com/watch?v=x_xYvV2YeT8

    127. Anonymous says:

      Credit Default Swaps (CDS)- is a 684Trillion Dollar OTC derivatives market….. That’s $640,000,000,000,000.00
      There is not that much gold to back up that amount of money, nor is there that much money in circulation= USA is BROKE=Crooks were allowed to run up a $640 Trillion debt we can never repay.

      http://www.youtube.com/watch?v=7Xi6XOJnquY&feature=related

    128. Anonymous says:

      http://www.straightdope.com/columns/read/719/how-much-money-is-there

      A Straight Dope Classic from Cecil’s Storehouse of Human Knowledge
      How much money is there? With the U.S. borrowing so much, why aren’t we broke?
      August 23, 1991

      Dear Cecil:

      How much U.S. currency (cold cash) is in circulation around the world? Who decides how much to print? With the government continually borrowing money, shouldn’t lenders be broke by now? Where do they get the money to keep lending out, especially when they know that none of it will ever be paid back?

      — F. Lucre, Dallas

      Cecil replies:

      Cheezit, Phil, you’re asking me to boil two semesters of freshman econ down to 600 words. Fortunately, this is not that hard. The following pretty much covers what the well-informed citizen needs to know:

      Coins and paper currency are economic petty cash. At the end of 1990 the total amount of currency in circulation was $246 billion. The total amount of money, by the strictest definition (what economists call M1), was $825 billion. M1 money is whatever you can spend right now–currency plus checking deposits. A more inclusive estimate of the money supply (M2–includes savings accounts) was $3.3 trillion.

      While currency is still the most popular method of payment, it accounts for only 1 percent of the value of all transactions. (The big money travels via “wire transfer” between banks–0.1% of the transactions, but 80% of the dollars.) People sometimes say inflation occurs when the government “prints too much money.” Nonsense. The amount of money actually printed is inconsequential.

      Nobody is in charge of deciding how much currency to issue. The Treasury Department prints it, but the amount actually distributed to the public is purely a function of consumer demand. If people want more greenbacks, they draw down their checking accounts and get them. The government prints as much as people want.

      The government doesn’t create money, private banks do. Banks create money by making loans. Suppose I put $100 in my checking account. The bank bets I won’t draw it out for a while and lends $85 of my $100 to legendary cartoonist Slug Signorino. Slug blows the $85 on Captain Morgan and lottery tickets at McGinty’s. Now McGinty’s has $85 in folding green and I’ve got $100 in checking that theoretically I can draw out at any time. Behold, the local money supply has bloomed from $100 to $185.

      It doesn’t stop there. If McGinty’s puts the $85 in its checking account, its bank will lend out most of it, increasing the money supply even more. That’s how the banks find the cash to lend to Uncle Sam. They lend it out, the government spends it, the recipients put the money in the bank, and the banks lend out that. The total amount of money that banks can create is regulated by the Federal Reserve. Too much money (not too much currency) = inflation.

      The whole financial system is a house of cards. Probably during that last example you were thinking, jeez, what if Uncle Cecil drew out his $100, as he was legally entitled to do? It wouldn’t be there! Righto. If everybody decided to take what they had coming out of their accounts and bury it in the garden, the financial system would collapse, civilization would end, and we’d all go back to being hunter-gatherers. The modern world is made possible by the trust and sheeplike predictability of millions of depositors. (Deposit insurance makes it less of a crapshoot than it once was.)

      The Federal Reserve System is not part of the government and is answerable to no one. (I know you didn’t ask, but lots of other people have.) By “government” I mean the executive branch. The President does appoint the Fed’s governing board but the members serve for long terms and can do as they please, free of political interference (in theory). The Fed is a quasi-public agency created by Congress and as a practical matter does not lightly defy the President.

      The government will never pay back the money it owes and nobody expects it to. The government borrows money by selling bonds. Each bond is a portable money machine, generating interest for its owner on a dependable schedule. Nobody wants these bonds to go away. In fact, in a time of worldwide financial instability, they are in great demand. To pay off old bonds the government simply issues new ones. The main concern is that the government not issue so many bonds that the interest payments get out of hand.

      Strange business, eh? Strange as nuclear physics in its way, about as widely understood, and offering much the same attraction: the chance to yank the wires holding together the world.

      — Cecil Adams

    129. Anonymous says:

      Estimate of world Gold in December 2005

      In December 2005, the World Gold Council reported (reg. req) world gold holdings of ~30,998 metric tonnes of gold and IMF-participating country holdings of ~27,581 metric tonnes of gold. For the participating countries, that gold represents 9.2% of the total foreign reserves. At 32,151 troy oz/metric tonne and today’s closing price of $558.50/troy oz, you’re looking at ~US$0.5 trillion locked up in gold. For the total foreign reserves of IMF countries, it’s about US$5.4 trillion. Substitute 30,998 metric tonnes of gold instead and it’s ~US$6.1 trillion for the whole world.

      $6.1 trillion in world gold(2005)
      $648 Trillion CDS market=(2008)
      __________________________
      0.0094135=BROKEN BEYOND REPAIR

    130. Bond, James says:

      For those that don’t get what it means for 17 brokerages to sell $3 trillion in fake counterfeited IOU government bonds, try to understand what that amount of money is.

      $3 trillion is 3 million people each get $1 million. It’s like one out of every one hundred Americans getting $1 million.

      And the 17 brokerages generate it by printing IOU’s and lying to the lenders so they can suck this cash into their house of cards.

      Where does the cash come from? From you – your buying power is pushed down proportionally to these counterfeit bonds as your tax rates are pushed up to pay the extra interest.

      AND WE ARE BAILING THE 17 BANKSTER CRIMINAL ORGANIZATIONS OUT!!?!!?!?!

      Where are the guillotines?

      And no one goes to jail and the media doesn’t mention it.

      Am I living in bizzarro world?

      http://tinyurl.com/dk6jms

      If you have any good information (scour old posts) from this site, send them to Michael Moore for his new movie on the Wallstreet crooks.

      bailout@michaelmoore.com.

      He needs to understand counterfeiting of stocks, bonds, oil, grain, currencies, etc. and the control the thieves have over the regulators and politicians to make a good movie.

    131. Bond, James says:

      What will it take for my fellow Americans to wake the f up from their slumber?

      http://www.goldismoney.info/forums/showthread.php?t=316054&highlight=deliver

      Come on, send some emails to your friends and relatives. This is easy to understand. We are being RIPPED OFF!!!

      A viral email could reach every American in a day or two if people would just forward it to their friends.

    132. Marv Eatinger says:

      The Madoff scheme is a tragedy, but it is only the tip of the ice berg. Daleco Resources Corporation goes straight to the bowels of the regulatory system for publicly traded equities. Daleco represents how professionals who hold themselves out as legitimate and law abiding use proprietary information gained from being employed by the SEC and take that information to a private practice and use it to line their own pockets and circumvent SEC scrutiny of public corporation fraud! The regulatory system for publicly traded equities needs a total reworking!

      Marv Eatinger ( I have posted details of Daleco’s fraudulent business plan on http://www.ragingbull.com symbol DLOV message board posts by “virgule” and http://www.yahoo.com finance message board for symbol “DLOV.OB” posts by “m_68114″ )

      IF YOU REMEMBER FROM MY POSTS AND SUBMISSION OF AN 86 ITEM COMPLAINT PACKAGE WITH THE LOS ANGELES BRANCH OF THE SEC IN AUGUST OF 1989:

      1. THE ILLEGAL POOLING OF INTERESTS AMALGAMATION BETWEEN UNITED WESTLAND & REEF RESOURCES IN CANADA IN NOVEMBER OF 1981.

      2. THE MERGER IN NEVADA ON OCT. 1, 1983 OF WESTLANDS RESOURCES CORPORATION (NEVADA) & REEF RESOURCES CORPORATION (NEVADA) THAT IS RECORDED BY THE SECRETARY OF STATE OF NEVADA AS A MERGER THAT WAS OFFICIAL AS OF JAN. 25, 1984. [ THE INTERNAL REVENUE SERVICE NEVER KNEW THAT THE MERGER WAS EFFECTIVE ON OCT. 1, 1983. OCT. 1, 1983 WAS DALECO RESOURCES CORP (UNITED WESTLAND RESOURCES LTD.) START OF ITS 1984 FISCAL YEAR!!! ]

      3. THE FRAUDULENT ACCOUNTING CONSPIRACY THAT TOOK PLACE BETWEEN UNITED WESTLAND (NOW DALECO) & COOPERS & LYBRAND ACCOUNTING FIRM AS DALECO’S AUDITORS. ALL MADE POSSIBLE BY THE FRAUDULENT ACTS COMMITTED IN ITEMS 1 & 2 ABOVE.

      3a. THE MANIPULATION OF DALECO’S SEC FILINGS (20-F, 10-K, 10-Q ETC.) FOR 1983, 1984, 1985, 1986, & 1988 BY SHEA & GOULD LAW FIRM AND ITS MANAGING PARTNER MARIO V. MIRABELLI IN ORDER TO CIRCUMVENT SEC SCRUTINY AS TO DALECO’S FRAUDULENT BEGINNINGS (FILINGS WERE MANIPULATED INTO BRANCHES 1,3, 4 & 5 OF THE DIVISION OF CORPORATE FINANCE).

      4. ON NOV. 11, 1992 DALECO RESOURCES CORPORATION FILED A PRELIMINARY PROSPECTUS WITH THE SEC FOR THE ISSUE OF 3,000,000 COMMON SHARES. THE UNDERWRITERS FOR THIS ISSUE WERE TO BE MEYERS, POLLOCK, ROBBINS INC. THE SEC APPARENTLY NEVER APPROVED THIS ISSUE.

      New York County District Attorney’s Office
      Manhattan District Attorney Robert M. Morgenthau announced that MICHAEL PLOSHNICK, the president of MEYERS POLLOCK ROBBINS INC., has pleaded guilty today to …
      manhattanda.org/whatsnew/press/2000-10-04.shtml – 11k – Cached – Similar pages

      5. NOVEMBER OF 1995 DALECO RESOURCES CORPORATION BARRON’S – MARKET WEEK ADVERTISEMENT (NOV. 27, 1995 – MW15) THAT ON NOV. 17, 1995 DALECO ACQUIRED SUSTAINABLE FOREST INDUSTRIES, INC. – TELEPHONE NO. 516-357-9759 HEMPSTEAD, LONG ISLAND. I CALLED THIS NUMBER AND GOT A RECEPTIONIST WHO TOLD ME THAT THIS WAS THE OFFICE OF A CLEANING COMPANY THAT DID CLEANING FOR 5 DIFFERENT COMPANIES. 6 MONTHS LATER I CALLED THE SAME TELEPHONE NUMBER AND THE RECEPTIONIST TOLD ME THAT THIS WAS THE OFFICE FOR A FIRM THAT SOLD EMERGING COMPANY STOCKS (MY OPINION – A BOILER ROOM OPERATION).

      6. ON MARCH 17, 1996 DALECO RESOURCES CORPORATION ENTERS INTO A CONSULTING AGREEMENT WITH DEVEN RESOURCES, INC.

      7. ON MARCH 19, 1996 DALECO RESOURCES CORPORATION ENTERS INTO A CONSULTING AGREEMENT WITH AVONWOOD CAPITAL CORPORATION.

      8. ON OCTOBER 1, 1996 DALECO RESOURCES CORPORATION BECOMES A DOMESTIC UNITED STATES COMPANY INCORPORATED IN DELAWARE AND EFFECTIVE OCT. 1, 1996 MERGES WITH DEVEN RESOURCES, INC.

      9. DECEMBER 1996 THROUGH JANUARY 1997 REGULATION “S” SHARES THAT DALECO SUPPOSEDLY SOLD TO “FOREIGN INVESTORS” ARE BEING SOLD BACK INTO THE NASDAQ MARKET BY THOSE SUPPOSED “FOREIGN INVESTORS”. (9,000,000 PLUS REG “S” SHARES)

      10. SOMETIME IN 1996 OR 1997 DALECO HAS AT LEAST 5,000,000 COMMON SHARES BEING SOLD “NAKED SHORT”.

      11. EFFECTIVE FEBRUARY 17, 1998 DALECO RECORDS WITH THE SECRETARY OF STATE OF DELAWARE A 1 FOR 10 REVERSE COMMON STOCK SPLIT.

      12. EFFECTIVE FEBRUARY 24, 1998 DALECO RECORDS IN ALL FUTURE SEC FILINGS A 1 FOR 10 REVERSE COMMON STOCK SPLIT.

      13. ON FEBRUARY 24, 1998 DALECO’S NEW CUSIP NO. BECOMES 23437P208. HOWEVER, DALECO IN ALL FUTURE SEC FILINGS NEVER USES THIS NEW CUSIP NO. BUT USES THE OBSOLETE CUSIP NO. OF 23437P109. THIS MAKES IT POSSIBLE FOR DALECO TO CIRCUMVENT SEC SCRUTINY AS TO THE FEB. 24, 1998 1 FOR 10 REVERSE SPLIT.

      14. IN EFFECT THE ABOVE (ITEM 11. & 12.) TWO 1 FOR 10 REVERSE SPLITS WOULD APPEAR AS A 1 FOR 100 REVERSE SPLIT OF THE ORIGINAL COMMON SHARES ON HISTORIC RECORDS IN CERTAIN REGULATORY AGENCIES. SEE COVERING OF “NAKED SHORT SALES” WITH THE ADDITION OF TWO ZEROS IN ITEM 15. BELOW!

      15. FEBRUARY 28, 2000 THROUGH AUGUST 1, 2000 WHILE DALECO IS DELISTED TO THE “PINK SHEETS” AND USING TWO ACTIVE SYMBOLS OF “DLOV & DLVO”, DALECO STAGES ACTUAL TRADES FOR ITS COMMON STOCK AND ADDS TWO ZEROS TO THESE DAILY TRADES IN ORDER TO COVER 1/100 OF THE VOLUME OF COMMON SHARES THAT WERE SOLD “NAKED SHORT” IN 1996 AND/OR 1997.

      16. ALL OF THE ABOVE VIOLATIONS HAVE MADE IT IMPOSSIBLE FOR DALECO RESOURCES CORPORATION TO FILE REPORTS WITH THE SEC THAT ARE FREE OF MISLEADING & DECEPTIVE STATEMENTS!

      Rule 10b-5: Employment of Manipulative and Deceptive Practices”:
      It shall be unlawful for any person, directly or indirectly, by the use of any means or instrumentality of interstate commerce, or of the mails or of any facility of any national securities exchange,
      (a) To employ any device, scheme, or artifice to defraud,
      (b) To make any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading, or
      (c) To engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person,
      in connection with the purchase or sale of any security.

    133. Oldepro says:

      Brother can you spare a dime?

    134. Diane says:

      It would seem that Congres is not desirous of dealing with the root of the problem, they are simply hysterically throwing more money at the cause. The only way to kill the beast is to stop feeding it.

    135. Marv Eatinger says:

      —– Original Message —–
      From: marv eatinger
      To: president@whitehouse.gov
      Sent: Saturday, February 14, 2009 6:56 PM
      Subject: Fw: THE REGULATORY SYSTEM FOR PUBLICLY TRADED EQUITIES IN THE UNITED STATES OF AMERICA

      —– Original Message —–
      From: marv eatinger
      To: hawked@sec.gov ; chairmanoffice@sec.gov ; CFLETTERS ; fraud@gao.gov ; casework@grassley.senate.gov ; caseyk@sec.gov ; aguilarl@sec.gov ; paredest@sec.gov ; waltere@sec.gov ; brandon_barford@banking.senate.gov ; lee@leeterry.com ; oig@sec.gov
      Cc: Kara.scannell@wsj.com
      Sent: Saturday, February 14, 2009 6:54 PM
      Subject: THE REGULATORY SYSTEM FOR PUBLICLY TRADED EQUITIES IN THE UNITED STATES OF AMERICA

      FRIENDS: BELOW LINK IS FROM “DEEP CAPTURE” WEB SITE:
      IF YOU HAVE THE TIME, READ THE BELOW COPIED LINK (A VERY LONG HISTORICAL SUMMARY OF FRAUD, DECEPTION & MURDER ASSOCIATED WITH PUBLIC EQUITY MARKETS). IT IS FASCINATING AND WILL GIVE YOU AN IDEA AS TO THE BASIC UNDERPINNINGS OF OUR SYSTEM OF DEMOCRATIC CAPITALISM AND JUST HOW CROOKED THAT SYSTEM IS ENTRENCHED BEYOND THE REACH OF THE REGULATORY AUTHORITIES IN THE UNITED STATES OF AMERICA FOR PUBLICLY TRADED EQUITIES!

      DALECO RESOURCES CORP (OTCBB – “DLOV”) OPERATED ON THE FRINGE, USING THEIR CONNECTIONS AND THE ABILITY TO SELL “NAKED SHORT” AND COVER THESE “NAKED SHORT” SALES THREE YEARS LATER WITH THE ADDITION OF TWO ZEROS TO DALECO’S ACTUAL TRADING VOLUME IN ORDER TO COVER 1/100th OF DALECO’S “NAKED SHORT” SALES IN 1996 & 1997 THREE YEARS LATER FROM FEB. 28, 2000 TO AUG. 1, 2000 WHILE USING TWO ACTIVE SYMBOLS OF “DLOV” & “DLVO”!

      AMAZING & DEPRESSING!!!

      Marv Eatinger

      Bernard Madoff, the Mafia, and the Friends of Michael Milken
      February 3rd, 2009 by Mark Mitchell

    136. Marv Eatinger says:

      —– Original Message —–
      From: marv eatinger
      To: hawked@sec.gov ; chairmanoffice@sec.gov ; CFLETTERS ; fraud@gao.gov ; casework@grassley.senate.gov ; caseyk@sec.gov ; aguilarl@sec.gov ; paredest@sec.gov ; waltere@sec.gov ; brandon_barford@banking.senate.gov ; lee@leeterry.com ; oig@sec.gov
      Cc: Kara.scannell@wsj.com ; president@whitehouse.gov
      Sent: Sunday, February 15, 2009 4:14 PM
      Subject: ” DEEP CAPTURE ”

      Dear Federal Government Regulatory Authorities For Public Equities Listed On United States Markets:

      THE FOLLOWING POSTS “MARV EATINGER SAYS” ARE COPIED FROM THE FOLLOWING WEB SITE (THE MITCHELL REPORT):
      Deep Capture is a work of investigative journalism examining the growing threat to our financial system posed by illegal naked short selling, stock manipulation, and the destruction of public companies.

      Links to all sections of Deep Capture are on the right. An explanation of the four main sections appears below.

      The Explanation The Story
      Anti-Social Media The Mitchell Report
      Dr. Patrick Byrne explores the players, methods, and consequences of what is being called “the greatest financial crime in history”. For a textbook-like explanation, read this.

      Marv Eatinger An epic work of media criticism by journalist Mark Mitchell, focusing on a hedge fund- orchestrated campaign to cover-up the crime of “naked short selling”.
      Journalist Judd Bagley investigates the use of blogs, wikis and message boards to manipulate stock prices, public opinion, and mass media. Mark Mitchell provides commentary on mainstream media coverage of the quickly-evolving naked short selling scandal.

      Marv Eatinger Says:
      February 15th, 2009 at 8:04 am
      The Madoff scheme is a tragedy, but it is only the tip of the ice berg. Daleco Resources Corporation goes straight to the bowels of the regulatory system for publicly traded equities. Daleco represents how professionals who hold themselves out as legitimate and law abiding use proprietary information gained from being employed by the SEC and take that information to a private practice and use it to line their own pockets and circumvent SEC scrutiny of public corporation fraud! The regulatory system for publicly traded equities needs a total reworking!

      Marv Eatinger ( I have posted details of Daleco’s fraudulent business plan on http://www.ragingbull.com symbol DLOV message board posts by “virgule” and http://www.yahoo.com finance message board for symbol “DLOV.OB” posts by “m_68114″ )

      IF YOU REMEMBER FROM MY POSTS AND SUBMISSION OF AN 86 ITEM COMPLAINT PACKAGE WITH THE LOS ANGELES BRANCH OF THE SEC IN AUGUST OF 1989:

      1. THE ILLEGAL POOLING OF INTERESTS AMALGAMATION BETWEEN UNITED WESTLAND & REEF RESOURCES IN CANADA IN NOVEMBER OF 1981.

      2. THE MERGER IN NEVADA ON OCT. 1, 1983 OF WESTLANDS RESOURCES CORPORATION (NEVADA) & REEF RESOURCES CORPORATION (NEVADA) THAT IS RECORDED BY THE SECRETARY OF STATE OF NEVADA AS A MERGER THAT WAS OFFICIAL AS OF JAN. 25, 1984. [ THE INTERNAL REVENUE SERVICE NEVER KNEW THAT THE MERGER WAS EFFECTIVE ON OCT. 1, 1983. OCT. 1, 1983 WAS DALECO RESOURCES CORP (UNITED WESTLAND RESOURCES LTD.) START OF ITS 1984 FISCAL YEAR!!! ]

      3. THE FRAUDULENT ACCOUNTING CONSPIRACY THAT TOOK PLACE BETWEEN UNITED WESTLAND (NOW DALECO) & COOPERS & LYBRAND ACCOUNTING FIRM AS DALECO’S AUDITORS. ALL MADE POSSIBLE BY THE FRAUDULENT ACTS COMMITTED IN ITEMS 1 & 2 ABOVE.

      3a. THE MANIPULATION OF DALECO’S SEC FILINGS (20-F, 10-K, 10-Q ETC.) FOR 1983, 1984, 1985, 1986, & 1988 BY SHEA & GOULD LAW FIRM AND ITS MANAGING PARTNER MARIO V. MIRABELLI IN ORDER TO CIRCUMVENT SEC SCRUTINY AS TO DALECO’S FRAUDULENT BEGINNINGS (FILINGS WERE MANIPULATED INTO BRANCHES 1,3, 4 & 5 OF THE DIVISION OF CORPORATE FINANCE).

      4. ON NOV. 11, 1992 DALECO RESOURCES CORPORATION FILED A PRELIMINARY PROSPECTUS WITH THE SEC FOR THE ISSUE OF 3,000,000 COMMON SHARES. THE UNDERWRITERS FOR THIS ISSUE WERE TO BE MEYERS, POLLOCK, ROBBINS INC. THE SEC APPARENTLY NEVER APPROVED THIS ISSUE.

      New York County District Attorney’s Office
      Manhattan District Attorney Robert M. Morgenthau announced that MICHAEL PLOSHNICK, the president of MEYERS POLLOCK ROBBINS INC., has pleaded guilty today to …
      manhattanda.org/whatsnew/press/2000-10-04.shtml – 11k – Cached – Similar pages

      5. NOVEMBER OF 1995 DALECO RESOURCES CORPORATION BARRON’S – MARKET WEEK ADVERTISEMENT (NOV. 27, 1995 – MW15) THAT ON NOV. 17, 1995 DALECO ACQUIRED SUSTAINABLE FOREST INDUSTRIES, INC. – TELEPHONE NO. 516-357-9759 HEMPSTEAD, LONG ISLAND. I CALLED THIS NUMBER AND GOT A RECEPTIONIST WHO TOLD ME THAT THIS WAS THE OFFICE OF A CLEANING COMPANY THAT DID CLEANING FOR 5 DIFFERENT COMPANIES. 6 MONTHS LATER I CALLED THE SAME TELEPHONE NUMBER AND THE RECEPTIONIST TOLD ME THAT THIS WAS THE OFFICE FOR A FIRM THAT SOLD EMERGING COMPANY STOCKS (MY OPINION – A BOILER ROOM OPERATION).

      6. ON MARCH 17, 1996 DALECO RESOURCES CORPORATION ENTERS INTO A CONSULTING AGREEMENT WITH DEVEN RESOURCES, INC.

      7. ON MARCH 19, 1996 DALECO RESOURCES CORPORATION ENTERS INTO A CONSULTING AGREEMENT WITH AVONWOOD CAPITAL CORPORATION.

      8. ON OCTOBER 1, 1996 DALECO RESOURCES CORPORATION BECOMES A DOMESTIC UNITED STATES COMPANY INCORPORATED IN DELAWARE AND EFFECTIVE OCT. 1, 1996 MERGES WITH DEVEN RESOURCES, INC.

      9. DECEMBER 1996 THROUGH JANUARY 1997 REGULATION “S” SHARES THAT DALECO SUPPOSEDLY SOLD TO “FOREIGN INVESTORS” ARE BEING SOLD BACK INTO THE NASDAQ MARKET BY THOSE SUPPOSED “FOREIGN INVESTORS”. (9,000,000 PLUS REG “S” SHARES)

      10. SOMETIME IN 1996 OR 1997 DALECO HAS AT LEAST 5,000,000 COMMON SHARES BEING SOLD “NAKED SHORT”.

      11. EFFECTIVE FEBRUARY 17, 1998 DALECO RECORDS WITH THE SECRETARY OF STATE OF DELAWARE A 1 FOR 10 REVERSE COMMON STOCK SPLIT.

      12. EFFECTIVE FEBRUARY 24, 1998 DALECO RECORDS IN ALL FUTURE SEC FILINGS A 1 FOR 10 REVERSE COMMON STOCK SPLIT.

      13. ON FEBRUARY 24, 1998 DALECO’S NEW CUSIP NO. BECOMES 23437P208. HOWEVER, DALECO IN ALL FUTURE SEC FILINGS NEVER USES THIS NEW CUSIP NO. BUT USES THE OBSOLETE CUSIP NO. OF 23437P109. THIS MAKES IT POSSIBLE FOR DALECO TO CIRCUMVENT SEC SCRUTINY AS TO THE FEB. 24, 1998 1 FOR 10 REVERSE SPLIT.

      14. IN EFFECT THE ABOVE (ITEM 11. & 12.) TWO 1 FOR 10 REVERSE SPLITS WOULD APPEAR AS A 1 FOR 100 REVERSE SPLIT OF THE ORIGINAL COMMON SHARES ON HISTORIC RECORDS IN CERTAIN REGULATORY AGENCIES. SEE COVERING OF “NAKED SHORT SALES” WITH THE ADDITION OF TWO ZEROS IN ITEM 15. BELOW!

      15. FEBRUARY 28, 2000 THROUGH AUGUST 1, 2000 WHILE DALECO IS DELISTED TO THE “PINK SHEETS” AND USING TWO ACTIVE SYMBOLS OF “DLOV & DLVO”, DALECO STAGES ACTUAL TRADES FOR ITS COMMON STOCK AND ADDS TWO ZEROS TO THESE DAILY TRADES IN ORDER TO COVER 1/100 OF THE VOLUME OF COMMON SHARES THAT WERE SOLD “NAKED SHORT” IN 1996 AND/OR 1997.

      16. ALL OF THE ABOVE VIOLATIONS HAVE MADE IT IMPOSSIBLE FOR DALECO RESOURCES CORPORATION TO FILE REPORTS WITH THE SEC THAT ARE FREE OF MISLEADING & DECEPTIVE STATEMENTS!

      Rule 10b-5: Employment of Manipulative and Deceptive Practices”:
      It shall be unlawful for any person, directly or indirectly, by the use of any means or instrumentality of interstate commerce, or of the mails or of any facility of any national securities exchange,
      (a) To employ any device, scheme, or artifice to defraud,
      (b) To make any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading, or
      (c) To engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person,
      in connection with the purchase or sale of any security.

      Oldepro Says:
      February 15th, 2009 at 10:07 am
      Brother can you spare a dime?

      Diane Says:
      February 15th, 2009 at 10:15 am
      It would seem that Congres is not desirous of dealing with the root of the problem, they are simply hysterically throwing more money at the cause. The only way to kill the beast is to stop feeding it.

      Marv Eatinger Says:
      February 15th, 2009 at 1:27 pm
      —– Original Message —–
      From: marv eatinger
      To: president@whitehouse.gov
      Sent: Saturday, February 14, 2009 6:56 PM
      Subject: Fw: THE REGULATORY SYSTEM FOR PUBLICLY TRADED EQUITIES IN THE UNITED STATES OF AMERICA

      —– Original Message —–
      From: marv eatinger
      To: hawked@sec.gov ; chairmanoffice@sec.gov ; CFLETTERS ; fraud@gao.gov ; casework@grassley.senate.gov ; caseyk@sec.gov ; aguilarl@sec.gov ; paredest@sec.gov ; waltere@sec.gov ; brandon_barford@banking.senate.gov ; lee@leeterry.com ; oig@sec.gov
      Cc: Kara.scannell@wsj.com
      Sent: Saturday, February 14, 2009 6:54 PM
      Subject: THE REGULATORY SYSTEM FOR PUBLICLY TRADED EQUITIES IN THE UNITED STATES OF AMERICA

      FRIENDS: BELOW LINK IS FROM “DEEP CAPTURE” WEB SITE:
      IF YOU HAVE THE TIME, READ THE BELOW COPIED LINK (A VERY LONG HISTORICAL SUMMARY OF FRAUD, DECEPTION & MURDER ASSOCIATED WITH PUBLIC EQUITY MARKETS). IT IS FASCINATING AND WILL GIVE YOU AN IDEA AS TO THE BASIC UNDERPINNINGS OF OUR SYSTEM OF DEMOCRATIC CAPITALISM AND JUST HOW CROOKED THAT SYSTEM IS ENTRENCHED BEYOND THE REACH OF THE REGULATORY AUTHORITIES IN THE UNITED STATES OF AMERICA FOR PUBLICLY TRADED EQUITIES!

      DALECO RESOURCES CORP (OTCBB – “DLOV”) OPERATED ON THE FRINGE, USING THEIR CONNECTIONS AND THE ABILITY TO SELL “NAKED SHORT” AND COVER THESE “NAKED SHORT” SALES THREE YEARS LATER WITH THE ADDITION OF TWO ZEROS TO DALECO’S ACTUAL TRADING VOLUME IN ORDER TO COVER 1/100th OF DALECO’S “NAKED SHORT” SALES IN 1996 & 1997 THREE YEARS LATER FROM FEB. 28, 2000 TO AUG. 1, 2000 WHILE USING TWO ACTIVE SYMBOLS OF “DLOV” & “DLVO”!

      AMAZING & DEPRESSING!!!

      Marv Eatinger

      Bernard Madoff, the Mafia, and the Friends of Michael Milken
      February 3rd, 2009 by Mark Mitchell

    137. Sean says:

      I have just seen the movie “The International” my recommendation is go see it and learn what Patrick and Deepcapture staff have been up against for the last few years!!(Bobo/the Easterbunny also) This corruption cannot be stopped. It is too deep!!

    138. al says:

      http://finance.yahoo.com/tech-ticker/article/175181/Jim-Chanos-SAC-Snared-in-Wall-Street-Research-Scandal?tickers=FFH,^DJI,^GSPC

      Yahoo Finance News

      “Jim Chanos, SAC Snared in Wall Street Research Scandal”

      Although the headline is enticing, the reporter goes on to say the evidence is weak & problematic.

    139. Anonymous says:

      http://finance.yahoo.com/tech-ticker/article/175181/Jim-Chanos-SAC-Snared-in-Wall-Street-Research-Scandal?tickers=FFH,^DJI,^GSPC

      ” Heiman wrote Chanos on Jan. 16: “Just got off the phone with Gwynn at Morgan Keegan — his piece that rips FFH apart is supposed to be published tomorrow. Should be interesting to see how the street reacts.”

      Heiman’s challenge will be to explain what he meant by “just got off the phone.” Kynikos’s lawyer implies that the conversation took place after the market close, which will likely be important. But there is no denying that Kynikos knew that a report was coming and what was likely to be in it, so the strong inference will be that a tipoff about the timing of publication triggered the trade. ”

      This is a no brainer. What was the time the email was sent to Chanos vs when they increased their short position (trading records time vs time email sent , and what was the time the report was published by Gwynn . ( It will clearly show whether this was before the report or after market close as the Chanos Lawyer implies. DUHHHHHHHHHHHHHHHH

    140. Rayelan Allan says:

      I would LOVE to interview you on http://www.rumormillnewsradio.com

      Can you email me to set up a time?

      Rayelan
      Publisher
      http://www.rumormillnews.com

    141. iStandUp says:

      Dr. Jim Decosta,

      I am trying to understand an important phrase you use to explain Abusive Naked Shorting Selling (ANSS):

      “collateralization versus payment” (CVP)

      in contrast to:

      “delivery versus payment” (DVP)

      I am trying to understand the meaning of “collateralization” in the DTCC clearance and settlement system.

      Here is a definition I found for collateralization:

      “What Does Collateralization Mean?

      The act where a borrower pledges an asset as recourse to the lender in the event that the borrower defaults on the initial loan. Collateralization of assets gives lenders a sufficient level of reassurance against default risk, which allows loans to be issued to individuals/companies with less than optimal credit history/debt rating.

      Investopedia explains Collateralization:

      Mortgage financing allows borrowers to hold title over their own home despite acquiring it via borrowed funds. However, in the terms of the mortgage, if the borrowers default on the mortgage payments, the lender has a right to sell the property to recoup the loan amount. ”
      ( http://www.investopedia.com/terms/c/collateralization.asp )

      Which part of these definitions explain the meaning of “collateralization” in the DTCC clearance and settlement system?

      FYI: For those interested I found Dr. Jim DeCosta’s 65 page letter to the SEC dated Nov 2008 on this topic:

      http://www.sec.gov/comments/s7-30-08/s73008-40.pdf

      Thank you Dr. DeCosta.

    142. Marv Eatinger says:

      NAKED SHORT SELLING & COVERING BY DALECO RESOURCES CORP – SYMBOLS “DLOV” & “DLVO”. SEE FEB 15, 2009 POST BY MARV EATINGER:

      —– Original Message —–
      From: marv eatinger
      To: sgoldstein@dtcc.com
      Cc: nsccaa@dtcc.com ; newseditors@wsj.com
      Sent: Thursday, July 17, 2008 7:15 PM
      Subject: NAKED SHORT SELLING AS AIDED & ABETTED BY THE DTCC?????

      STUART Z. GOLDSTEIN:

      DTCC: FROM FEB. 28, 2000 TO AUG. 1, 2000 DALECO RESOURCES CORP OR DALECO RESOURCES INC. TRADED ACTUAL SHARE VOLUME OF APPROXIMATELY 70,000 COMMON SHARES WHILE DELISTED TO THE PINK SHEETS FROM THE OTCBB MARKET. IN 1996 & 1997 DALECO RESOURCES CORP OR DALECO RESOURCES INC. HAD APPROXIMATELY 7,000,000 COMMON SHARES SOLD “NAKED SHORT”. THESE “NAKED SHORT” SALES WERE COVERED BY THE ACTUAL TRADING OF APPROXIMATELY 70,000 COMMON SHARES PLUS TWO EXTERNALLY ADDED ZEROS 3 YEARS LATER FROM FEB. 28, 2000 TO AUGUST 1, 2000!!! DID THE DTCC AID DALECO IN THIS SCAM OF THE REGULATORY SYSTEM FOR PUBLIC EQUITIES?

      Marv Eatinger

      > FROM HISTORICAL VOLUME FOR DALECO RESOURCES CORP– (AS OF SEPT. 27, 2006 AT 4:29 PM CST THE BELOW HISTORICAL
      VOLUME DATA FOR DALECO RESOURCES CORP HAS NOT
      CHANGED ON http://WWW.MONEYCENTRAL.COM)
      > SYMBOL DLOV ON http://WWW.MONEYCENTRAL.COM
      >
      >——————————————————–VOLUME
      > 3/14/2000 0.1563 0.1563 0.1563 0.1563 230,000
      > 3/13/2000 0.7500 0.7500 0.7500 0.7500 200,000
      > 3/10/2000 0.1250 0.1250 0.1250 0.1250 0
      > 3/9/2000 0.1250 0.1250 0.1250 0.1250 30,000
      > 3/8/2000 0.7500 0.1250 0.1250 0.1250 2,620,000
      > 3/7/2000 0.5000 0.1250 0.1250 0.1250 230,000
      >
      > ===========================================================================================
      —– Original Message —–
      From: “Ron Franz”
      To:
      Sent: Tuesday, April 04, 2006 10:13 AM
      Subject: Re: [CSI Website Query: daily volume figures multiplied by 100 - symbol DLOV]

      >I had them remove the extra digits.
      > Yahoo should have it corrected by this afternoon.
      > Please let me know if you do not see the corrections.
      > Thank You,
      >
      >
      > marv@mitec.net wrote:
      >> Regarding:
      >> Data Error Report
      >>
      >>
      >> Message:
      >> On March 7, 2000 the following web sites showed volume for the day for DLOV – Daleco Resources CP of 2,300 shares: FinancialWeb.com and Quicken.com.
      >>
      >> On March 8, 2000 the following web sites showed volume for the day for DLOV – Daleco Resources CP of 26,200 shares: FinancialWeb.com, Quicken.com and MSN Money Central.com.
      >>
      >> On March 13, 2000 Barchart.com showed DLOV – Daleco Resources Corp volume for the day as 2,000 shares.
      >>
      >> Daleco Resources Corp was deleted from the OTCBB to the Pink Sheets on February 22, 2000 to be effective on February 28, 2000. Yahoo Finance & MoneyCentral web sites are presently the only web sites that I can find that show Historical Volume figures for the time period of March 1, 2000 to August 1, 2000 when Daleco Resources Corp was listed only on the Pink Sheets.
      >>
      >> Yahoo Finance Historical Volume figures for the above mentioned dates is shown as follows:
      >> March 7, 2000——————–230,000 shares
      >>
      >> March 8, 2000——————2,620,000 shares
      >>
      >> March 13, 2000——————200,000 shares
      >>
      >> Apparently from the period starting March 1, 2000 to August 1, 2000, all trades that took place in Daleco’s stock had two zeros added to the daily trading volume!
      >>
      >>
      >> From:
      >> marv@mitec.net

      > FROM HISTORICAL VOLUME ON http://WWW.YAHOO.COM FOR– (AS OF SEPT. 27, 2006 AT 4:35 PM CST THE BELOW HISTORICAL
      VOLUME DATA FOR DALECO RESOURCES CORP HAS NOT CHANGED
      ON http://WWW.YAHOO.COM SINCE TWO ZEROS WERE REMOVED FROM THIS
      HISTORICAL TRADING VOLUME ON APRIL 4, 2006 – SEE RON@CSIDATA.COM
      ABOVE EMAIL DATED APRIL 4, 2006 AT 10:13 EST)
      > DALECO RESOURCES CORP SYMBOL DLOV
      >
      >——————————————————— VOLUME
      > 14-Mar-000.160.160.160.16 2,300
      > 0.13
      > 13-Mar-000.750.750.750.75 2,000
      > 0.63
      > 10-Mar-000.120.120.120.12 0
      > 0.10
      > 9-Mar-000.120.120.120.12 300
      > 0.10
      > 8-Mar-000.120.750.120.12 26,200
      > 0.10
      > 7-Mar-000.120.500.120.12 2,300

    143. davidn says:

      Istandup, I think what Dr. DeCosta means is that rather than delivering shares, the seller can deliver cash the same way you give the bank your mortgage deed until your bank loan is paid off.

      For example, a market maker might deliver 102% of the value of the trade as cash.

      So, let’s say they sell $1 million worth of stock. They would let the buyer keep $1,020,000 as collateral. Only $20,000 comes from the seller – the rest was proceeds of the trade.

      The collateral is repriced each day according to the bid price of the stock.

      If the stock price falls 50%, then the collateral requirement is only $510,000. Since the proceeds of the sale was $1 million, the seller can pull $490,000 from the original sale out even though they still haven’t delivered anything.

      If the price runs and the seller flees with the cash, the NSCC (a DTCC subsidiary) is on the hook as they guaranteed the trade, so they have a strong incentive to help the thieves keep prices from ever running.

    144. Dr. Jim DeCosta says:

      iStandup,
      I just finished a 20-page paper reviewing CVP for a member of one of the SEC congressional oversight committees in D.C. Here is the summary. You’re welcome to the text but I don’t want to steal too much bandwidth here. If you’ve got a sight somewhere I’ll post it and create a link.

      “Clearance and settlement systems like that of the DTCC which utilize “central counterparties” and the legal concept of “novation” are extremely susceptible to abuse. At one moment the seller of securities owes an investor half way around the world the delivery of the securities he sold to him. Two seconds later after “novation” the seller, an NSCC “participant”/co-owner of the NSCC, owes delivery to the NSCC management which are its employees. Two seconds after that the NSCC management (the employees) tells the seller of securities (one of its bosses) that it is a “powerless” creditor of that debt and that it can’t force the seller to deliver that which he sold but that the seller should at least collateralize the monetary amount of the delivery obligation on a daily marked to market basis to lend the whole process a sense of legitimacy. A day or two after that the presence of all of the readily sellable “securities entitlements” resulting from all of these “no need to delivers” cause the share price to plummet which lowers the collateralization requirements which allows the funds of the victimized investor to flow to those refusing to deliver that which they sold. Now that is one well-designed “fraud on the market”.”

    145. Dr. Jim DeCosta says:

      The gist of the above is that the mere collateralization of the EVER DIMINISHING monetary amount of a failed delivery obligation has nothing whatsoever to do with the DTCC’s Section 17 A (’34 Act) congressional mandate to “promptly settle” all securities transactions. The “prompt settlement” of a transaction necessitates the “prompt delivery” of that which was purchased. The “prompt collateralization” of the monetary amount of the debt which can be easily reduced by merely refusing to deliver that which you sell is a scam. This is equivalent to thousands of Madoffs.

    146. Dr. Jim DeCosta says:

      If you really want to put this scam on steroids you go to your buddies at the SEC and con them into removing the “Uptick rule”. Then you can absolutely tee off on the bids and knock them out in a serial fashion. This induces panic selling and the tripping of stop loss orders. This induces more selling and as the share price accelerates towards zero the collateralization requirements go towards zero and all of the unknowing investor’s funds go to those that refuse to deliver that which they sell.

    147. iStandUp says:

      davidn,

      Thank you. I kind of understand but I am missing the details, which is confusing me.

      If I buy a house, I can borrow the money from a mortgage company via a mortgage. I buy a house,:

      > the bank I borrow money from pays the builder the full price of the house I buy.
      >A house is delivered to me.
      >Then I pay the lending bank, the holder of my mortgage a monthly payment while live in the delivered house.

      In this example…
      > I buy a house…
      > I am delivered a house…
      >And I pay the lending mortgage company a monthly amount which includes the interest and principle as I live in the delivered house.

      I sense that the Collateralization on Wall Street when I buy stock is different, pervertedly different than when I buy a house, since when I buy a house I am delivered a house. Whereas, when I buy stock on Wall Street, I may NOT be delivered real stock, but merely some electronic marker, electronic accounting device. Yet my brokerage account statement will not indicate to me whether I received “real” shares or “counterfeit” shares.

      What I do not understand in your example davidn is WHO holds the money, Who holds the collateral.

    148. Davidn says:

      iStandup, you’re right, the analogy is not a perfect one.

      The answer to your question is generally, one of the big clearing firms holds the funds.

      The explanation:

      One thing to understand is that your brokerage generally only makes one buy or sell each day for each security. All of the trading through the day is netted to create just one big purchase or sale, so the buyer or seller would be the brokerage, not you. As clients make trades, your brokerage is just shifting shares or entitlements that they already hold from one client account to another. They will come up either short or long at the end of the day and that difference will be the trade they make.

      Where it gets more complicated is that most brokerages are actually customers of clearing firms. That clearing firm will take all the brokerage buys or sells and net them into one big buy or sell. At this point, the trades have been netted twice and we’re still not at the level of the NSCC.

      So in answer to your question, the buyer and sellers are usually clearing firms. The funds sit with the buyer, the clearing firm. They get paid interest to sit on your money. If they were to demand delivery of the shares, they’d stop getting the income from the interest, so they have no incentive to get delivery for your brokerage. Since the trades are all netted, it is a big fungible mass and you can’t tell which investor has an IOU and which has a share.

    149. Davidn says:

      Pershing is one of the firms who would typically keep the collateral and collect interest on it.

      William Donaldson was the Chairman of the SEC and when he was put on the hot seat about naked shorting, he said there was no such thing, then resigned. He had founded one of the clearing firms heavily involved in facilitating phantom shares.

      Drexel Burnham Lambert was Milken’s firm.

      “Donaldson, Lufkin & Jenrette or DLJ was a U.S. investment bank founded by William H. Donaldson, Richard Jenrette and Dan Lufkin in 1959.”

      “As research became more of a commodity throughout the 80s and 90s they had since expanded into other businesses. One of them was a dominance in high yield fixed income securities. They gained this dominance in both underwriting and trading by astutely picking up most of the expertise from Drexel Burnham Lambert after its demise in the late 1980s.”

      “The Pershing Division of DLJ (Harris) remained until being sold to the Bank of New York in 2003.”

      The SEC at the time claimed that the total of all fails was $5 billion, but Pershing alone had failures to deliver of $730 million and fails to receive of $968 million.

      They’ve taken the document disclosing that down after it was published in bobo’s forum.

      http://www.pershing.com/statementoffinancialcondition.pdf

      If you google “Focus Report” and “fail to deliver”, you might come across similar reports disclosing the obligations of other clearing firms.

      Fails to deliver are shares they owe someone else and fails to receive are shares someone else owes them.

      In general, these obligations net to zero and the clearing firms don’t owe each other anything and keep the customers cash to invest as they please.

    150. Dr. Jim DeCosta says:

      What CVP results in is 2 “opportunistic” clearing firms “pairing off”. CF “A” owes CF “B” $10 billion worth of deliveries on corporations “X”, “Y” and “Z” that it failed on. “B” owes “A” $10 billion worth of failed deliveries on corporations “G”, “H” and “I”. “A” and “B” agree with each other (in an ex-clearing arrangement) to just “collateralize” these debts on a daily marked to market basis and neither have to deliver the missing shares to each other. As the various share prices change money needs to be shunted back and forth. The share price of all 6 corporations has to tank by definition because all of these FTDs result in readily sellable “securities entitlements”.

      As the share prices predictably tank the funds of those that purchased the yet to be delivered shares flow to those refusing to deliver that which they sold because all they were asked to is to collateralize the monetary amount of the failed delivery obligation. As the share prices tank so too do the collateralization requirements.

      The net-net of it is that CF “A” says to CF “B” you can sell my clients bogus shares and refuse to deliver them in order to steal their money if I can do the same to your clients.

      This is how ex-clearing works but the same thing occurs at the DTCC. The NSCC says to its abusive NSCC clearing firm participants that we’re “powerless” to buy in your delivery failures. In ex-clearing the 2 clearing firms basically say to each other let’s agree to pretend to be “powerless” to buy-in each other’s delivery failures.

    151. Dr. Jim DeCosta says:

      These “ex-clearing arrangements” need not be so confusing to everybody when you realize who the NSCC and DTCC management are. They’re the “banksters” of Wall Street. Who are the clearing firms that do the “pairing off”. They’re also the “banksters” of Wall Street. When they commit these thefts they have an option of putting on a ski mask that says “NSCC participant” or one that says “registered clearing agency”.

      What the crime necessitates is that somebody play the role of pretending to be “powerless” to execute buy-ins which is the only cure available when the selling party absolutely refuses to deliver that which it sold.

    152. Davidn says:

      Dr. DeCosta’s post 168 is a great summary. Clearing A nets with Clearing B so they can sell each other’s customers bogus shares and the money flows in as the collateral declines with declining share prices.

      One important additional point, though, is that generally the customers are other brokerages, not you.

      1. For active stocks, such as Google, the brokerage just keeps track of orders through out the day and moves shares and IOU’s they already have in inventory from one customer account to another. If there aren’t enough shares, they do one buy at the end of the day and if there are too many, they do one sell at the end of the day. Most orders are filled by netting rather than going out into the world.

      2. That one buy or one sell is facilitated through the clearing company that clears for your brokerage. From their point of view, all the brokerages are just customers and they fill the brokerages buys and sells by shunting shares from one brokerage account to another, filling orders from inventory. If they are short shares or have too many, they do a deal with another clearing house to just owe those shares and those obligations mostly cancel out.

    153. John Sandman says:

      What about Sid Belzberg, CEO of Toronto-based Belzberg Technologies? He any relation to Walter, Sam and Hymie?

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