CEDE & CO/DTC as the market manipulation tool to show trades that are fakes. They can move wholesale numbers of shares back and forth on computer trading programs as many times a day (or night) as necessary to achieve the desired effect. That’s probably because it is only a front for the real owners. THE FED ? MAYBE ALL THE CENTRAL BANKS IN COLLUSION. ??

http://investorvillage.com/smbd.asp?mb=3532&mn=28045&pt=msg&mid=6266455

AIG May Owe $10 Billion for Sour Trades
Reuters
posted: 4 HOURS 53 MINUTES AGO
comments: 91
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NEW YORK (Dec. 10) – American International Group , once the world’s largest insurer, owes around $10 billion to other financial services firms for trades that have gone sour, the Wall Street Journal reported in its online edition on Tuesday.
The report, citing people familiar with the matter, says the trades have not been explicitly disclosed before, and are not covered by terms of a current $150 billion U.S. government rescue package.
The government’s rescue package was meant to save AIG from collapse, but the Wall Street Journal report says the newly discovered trades raise further questions about how the insurer will raise money to pay the debts.
An AIG spokesman could not immediately be reached to comment on the report.
Reporting by Paul Thomasch; Editing by Gary Hill
Copyright 2008, Reuters
2008-12-10 07:10:45

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Wed Dec 10, 7:35 am ET
AIG owes $10 billion on trades gone bad: report AFP/File – AIG headquarters in Hong Kong. The Wall Street Journal has reported that American International Group …

WASHINGTON (AFP) – Fallen US insurance giant American International Group owes financial firms some 10 billion dollars on speculative trades that turned sour, the Wall Street Journal reported on Wednesday.

The trades have not been explicitly revealed before and would not be covered by the US government’s bailout package of more than 150 billion dollars for the troubled company, the Journal reported, citing unnamed sources.

Details of the trades mark the first indication that AIG may have been gambling with its own capital, the Journal wrote.

The government intervened to rescue AIG from collapse in September and has since dramatically expanded its rescue funds as the firm suffers from failed bets on complex financial instruments.

An AIG spokesman told the Journal that the trades were not speculative bets but “credit protection instruments.”

He said the trades have been fully disclosed already and amount to less than 10 billion dollars of the firm’s 71.6 billion dollars exposure to derivative contracts on debt pools, or collateralized debt obligations, as of September 30.

AIG was the world’s largest insurer before the global credit crisis brought it down.

http://news.yahoo.com/s/afp/20081210/ts_alt_afp/financeeconomyinsuranceuscompanyaig_081210123530

http://tinyurl.com/66aqq5

“In 2000 I worked for a software development entity called SilverStream Software….SilverStream had built internet transactional and trading platforms for Merrill Lynch, Deutsche Bank, Banker’s Trust, Alex Brown, Morgan Stanley; to name a few”

“Why would anyone in their right mind invest in AIG when AIG played a major role in the collosal thefts from the WTC as the Towers fell? It appears AIG was set up for just that purpose.”

http://www.vnnforum.com/showthread.php?p=846599

Hedge Fund perpetrators tremble in FEAR of prosecution of a guy named Giovanni Spagnolo. Could the prosecution be happening in the USA? UNFORTUNATELY NOT! It’s happening in Australia. It seems that Australia is trying to clean-out the FINANCIAL-CRIMINAL-SCUM Naked Short Sellers among them. I quote from the article linked below:
……………………………………………………….

“Spagnolo faces five short-selling charges brought by the Australian Securities and Investments Commission. ASIC alleges that Spagnolo sold shares and options he did not own – the definition of naked short-selling – in breach of section 1020B(2) of the Corporations Act.”
………………………………………………………

I wonder — Will the SEC ever prosecute Hedge Funds in the USA that have been FINANCIALLY-RAPING legitimate investors via Naked Short Selling? I have yet to hear of ONE (1) prosecution of “Naked Short Selling”!!! This is irrational — considering that the markets have been pummelled — and the SEC is supposed to be the top policing/regulatory agency of the securities industry in the USA! It doesn’t make much sense to me — especially after viewing the rising FAILS-TO-DELIVERS in the charts posted by Dr. Patrick Byrne on this blog post. You would have to BLIND AS A BAT not to see that the monumental-nuclear-sized problem — is getting even worse!

But, surprisingly, the SEC even suspended the Uptick Rule on July 6, 2007 — which allows the Bear Raiding Hedge Funds to engineer even faster declines in share prices. Wasn’t that about the time the volatility (wide market swings) began ocurring? (HECK YEAH!!!)

Maybe USA regulators will wake up one day — and notice that the market is NEAR ZERO — and decide to level the playing field by reinstating the Up-tick Rule and PROSECUTING ALL NAKED SHORT SELLING.

Here’s a link to the complete article about the Australians trying to clean up the Hedge Fund scum among them:
http://business.theage.com.au/business/shortselling-case-will-test-the-law-20081107-5k6u.html

I want justice for LEGITIMATE INVESTORS — and I want to see the financial criminals prosecuted to the fullest extent of the law.

Hang_’em_High

There was a case where it was established that a clearing brokerage is not responsible for knowingly facilitating fraud because from their point of view, their customer is the brokerage.

Even if they know the brokerage is ripping off the investor, they have no fiduciary responsibility to the investor as their contract is only with the brokerage.

From their point of view, the brokerage is the beneficial owner of the shares, not you. They aren’t party to your agreement with your brokerage.

It takes a minute to get your head around it, but they’ve used contract law in a daisy chain across jurisdictions to protect themselves from being accused of fraud.

But:

At each step in the daisy chain, they don’t consider you their customer. Cede & Co. only has a contract with the DTC. You aren’t party to the agreement.

Read the DTC rules. From their point of view, the beneficial owner is the DTC participant (brokerage, clearing house or foreign depository) that their records show the shares belonging to.

There could be dozens of contracts with various parties in various jurisdictions between you, the beneficial owner and Cede, the actual owner.

And “criminal” applies to the criminal code in only the one country where the contract exists. There’s no such thing as a global criminal code.

They’ve used contract law to create a hodge podge of agreements across jurisdictions that not regulator has the authority to peer into as each regulator only regulates one tiny aspect of the system.

I met a guy who got loans in Canada against a fleet of motorhomes, then went to the US and got another set of loans against the same motorhomes in the US. He was caught using the same security twice, but he wasn’t arrested as in each country, he had abided by the laws of that country.

The solution is simple. The beneficial owner and the actual owner should be the same entity. With computers, it would be trivial for them to number investors and have the shares belong to an anonymous, unique investor at the end of each trading day.

Central depositories were invented in the days of mail and paper certificates and are completely irrelevant today, except as far as ripping us all off.

One minor clarification on your point, if I breached the hypothetical trust agreement with intent to defraud you or someone else, it would in fact be a criminal act in addition to a civil tort and a violation of the contract.

If I were using your house or other property (albeit titled to me in trust) to defraud you or other people, e.g., selling it multiple times and/or leasing it multiple times without telling the buyer(s) / lessee(s) then that also would be fraud, even if I had the right as trustee to administer the ‘trust asset’ for you. In fact I have a responsibility under state trust law to not cause or permit ‘waste’ of the trust assets. Actively assisting in the destruction of said assets would of course be a no no.

If I were loaning out the asset multiple times with reasonable suspicion or worse yet knowledge that the borrowers were committing a criminal act, e.g., stock manipulation, then that would in fact be a crime sometimes known as conspiracy, or a separate crime known as aiding and abetting. If I were making the ‘loans” AND I had in another department evidence –proof, in fact– that the borrowers were manipulating the public market for the asset I loaned them (multiple times), e.g., selling and letting delivery fail for days/weeks/months, then I would in fact be susceptible to civil and criminal charges.

The DTCC is a criminal enterprise with a legitimate front business; it is the ultimate counterfeiting and money laundering operation. The only problem is that no one will investigate them so they will continue to operate as a criminal enterprise.

I have typed part of this while on a couple of calls so I hope it makes sense…

It would be similar to if I gave you money to buy me a house and you registered it in your name. Even though I was the “beneficial” owner, you’d be the “actual” owner and could do whatever you want with it. I might have a trust agreement with you, but if you breached it, it wouldn’t be criminal. It’s only contract / civil law.

Patrick’s group may be the beneficial owners of 130% of the outstanding stock, but they aren’t the actual owner unless they’ve pulled their certificates or had their shares registered to themselves through dtc.

Beneficial owners have long chains of trust agreements with their broker who has an agreement with the clearing broker who has an agreement with the prime bank who has an agreement with the DTC who has an agreement with Cede & Co.

Anyone of those agreements can be broken, with IOU’s bloating to exceed actual shares.

What drives me nuts is how Cede & Co. could be a private holding company for the privately owned NYSE back in 1971 (Google Senator Metcalf) and now it owns EVERY share and bond in the DTCC system even though it is not part of the DTC or DTCC (it doesn’t appear in their annual reports).

The implication is that a privately owned partnership company of unknown jurisdiction has been nominated to be the actual owner of every share in the system.

They claim Cede stands for CEntral DEpository, but it is interesting that if you look up the word in a dictionary, you get:

“To surrender possession of, especially by treaty. See Synonyms at relinquish.”

They laugh at you as you give them control over your assets…