Today’s Yawn: Scoffers of Law Rocker-Gradient Ignore Court Order & Roddy Boyd Shills, Exhibit Z

To bring new readers up to speed:  DeepCapture long ago exposed hedge fund towel boy Roddy Boyd through such literary gems as Mark Mitchell’s “Michael Milken, 60,000 Deaths, and the Story of Dendreon” (N.B. Chapter XII), and my own essay, “Roddy Boyd Sucks It Like He’s Paying the Rent (Fortune Magazine)“, an exegesis of the collapse of Rocker Partners and review of the journalistic fellatio Roddy performed thereon (this latter piece should be read in conjunction with “Carol Remond Tells a Joke She Doesn’t Get“). I encouraged Fortune spokeswoman Katy Reitz to follow the emerging story on Roddy: whether for that reason or others of their own, Fortune and Roddy parted ways soon thereafter, Roddy to slither into his own unique and arrest-warrant-laden world (that’s him, just above the child porn guy).

As my feelings may not be obvious, even-handedness and transparency dictate that I disclose that compared to Roddy I’ve observed more intellect in a ice addict sitting on the floor of a 7-11 trying to remember how to use Comet and Pam Spray to cook meth, and more dignity in a crackhead living off $2 hand-jobs at the bus station.

Followers of the Overstock story (itself a sub-plot of the DeepCapture epic) know that at the end of 2008 Gradient Analytics’ Donn Vickrey and Bettis Brothers Carr and Leland apologized for and retracted years’ worth of lies, accusations, and smears about Overstock. Given that they had made their allegations a cornerstone of their business development, their decision to apologize and recant may,  I suspect, have undermined their ability to represent themselves as anything but lapdogs willing to charge for shill “research” one day those same fund managers they’ll sell out the next.  Then in late 2009, Rocker Partners dropped their counter-suit against Overstock and made their own apology in the form of a $5 million check.

In a process known as “discovery”, in the course of this lawsuit both sides turned over millions of pages of documents to the other.  Since the turning over of documents and depositions thereon, Gradient Analytics publicly retracted their accusations and apologized, and Rocker Partners dropped their counter-suit and coughed up $5 million: the litigation-conversant reader may make her own inference as to  how the weight of evidence tipped the scales of justice in this particular case.

Of more immediate interest, however, is the fact that, though those millions of pages of documents are covered by protective orders of the court, and hence their disclosure by Gradient, Rocker Partners, or their esteemed counsels (e.g., Fred Norton, Esq.) would be illegal, Roddy Boyd today emerged in possession of this material, which he proceeded to use in clumsy attempt to reprise his role as minor Wall Street lick-spittle.

Now having spent my share of hours in the company of all of these luminaries of ethics and right action, which one violated the court’s protective orders is difficult for me to say. I’ve had mops with more character than the lads at Gradient Analytics. David Rocker is bitter and insane (I wonder how he played it at his country club: “I swear I’m innocent, folks, but just in case, I hired David Boies’ criminal defense partner“).  Of course, in four years of litigation the ever-charming Fred Norton managed (as far as I could tell) precisely one moment of humanity, and even there, his motives were not entirely clear. So I’ll call it a photo-finish. (Though if I were a gambling man, I might have to put my money on the long-shot bet: the guys at Gradient, who give off that unique scent of low-rent hustlers just bright enough to have figured out they are playing out of their league but not bright enough to back away from the table).

Setting aside the issue of which of these pillars of our community gave the finger to a sitting California judge (and a retired federal judge who acted as Discovery Master in our litigation), an interesting question remains: will Roddy Boyd, having lost all appearance of reputation, honor, and employment, be game for another try?

And once again, Roddy doesn’t let us down.

Alas, beyond his brief stint at now-defunct criminal bacchanal that was Refco, Roddy has no actual work experience by which to make sense of the material thus provided him. So I think it best to  let his email tell the story, with my brief answers inserted in bold italics.

From: Roddy Boyd [mailto:[email protected]] Sent: Wednesday, January 13, 2010 7:04 AM
To: Patrick Byrne


Roddy Boyd here. I am writing a story for Slate’s I have set up this email account for this query and will no longer use it after 4:30 pm EST tonight. I will phrase the questions as bluntly as possible because I am not seeking to engage in an E-mail exchange. Should you need to reach out to the story’s editor, Please approach Jim Ledbetter. I believe his email address is [email protected]. Please have your response in by 4:30 pm EST.

Your response will be linked to in its entirety, as well as referenced within the body of the story–I imagine it would look something like, “Patrick Byrne said, ‘xyz…..'” (To see Byrne’s full response, click here.)

Answer: Thanks for the tip, Roddy, but I just decided to answer here on DeepCapture. We appreciate the link, though, and will return it once you publish. Remember, we journalists have to stick together.

The story deals with Overstock’s state of affairs in the fall of 2005 and winter of 2006. Specifically, It (sic) references the problems you had with factors such as CIT because of Overstock’s losses and its percieved (sic) weak operating position. The governing theme of the piece is that financial investigative reporting on fully operational companies is imprecise (unlike say doing a post-mortem on Lehman or Enron.) In other words, the concerns of OSTK critics about liquidity and the build-your-own-jewelry initiative appear correct, but that they (likely) could never have guessed precisely why.

“[A]ppear correct”, do they? Well we’re still here and doing quite well, thank you, while your patron David Rocker plays shuffleboard in Florida, muttering my name under his breath like a wino’s lament as he realizes that for years to come his own name will give off a foul stench among the smart money set he unsuccessfully aped.

An Email (sic) I quote, from 11/14/05, from David Chidester to you, Jonathan Johnson and Jason Lindsey says, “Unfortunately what we feared has begun. Some factors and banks have stopped insuring our payables.”

This clearly had been a problem of some duration for OSTK, since on 9/22/05, five weeks after your suit was filed, you stated in an email to your colleagues, “I just sat with CIT. They confirmed that at one time we were reasonably good (not great), and have turned to shit in the last six months.” You added: For years, I have been hearing from accounting that we pay our vendors super-promptly.”

Answer: The fact that we were considering  the views held by some does not make them material any more than, for example, my saying that “Roddy Boyd is a half-bright hedge fund shill” would have been a material event for New York Post, or Fortune, or whomever was then displaying the unfortunate judgment of employing  you. Some folks at CIT said one thing, some factors said another, our accounts said something else, our Paydex score (you may have to look that one up) held up throughout (and  is now an 80, pretty much at the top of the vendor-payment pyramid in our industry), and CIT turned out to be the one that went under. Ohhh, the irony, the irony.

The story also references emails between Rich Paongo and Chidester on January 20, 2006 which looked at the problems three of Overstock’s factors and lenders had with the company: Not meeting projections, no profits, low cash, and slow payments .” On February 28, 2006, Joanne Dalebout, E-mailed you and your colleagues, All [vendors] are saying that with Overstock in the papers a lot and the lawsuit they don’t think we will be in business and that we are too much of a risk? Also having problems with CIT not approving small orders.”

Answer: It appears your understanding of “material” includes how some people react to how other people react to exaggerated hedge fund-planted media pieces written by…. You.  These were not prevalent internal views or conclusions nor, most importantly, my views: I thought they were wrong, I proved to be right, and CIT went the way of the wild buffalo and your job at Fortune.

Why did OSTK not reference the troubles it was having with its key credit providers in any of its public communications?

Answer: So your understanding of “material” would include the report of a buyer about the rumors spread by a factor to the companies that this factor charged to justify the price of its services? Did I miss anything?

As you will recall, one of the concerns that OSTK critics had was the company’s cash-flow and operational soundness. For a retailer, this would clearly appear to meet the threshold of materiality. Do you disagree?

Answer: I do.

And would you elaborate on this decision?

Answer: Same answer.

The story will also mention “Operation heist and freeze” with your “Lubbavitcher friends” from

Answer: Right on.

–Why did you not disclose, per Jonathan Johnson’s report to the OSTK board on 7/13/05, that the diamond VIE was structured as it was to avoid “Nexus in the State of New York for sales tax purposes.”

Answer: Same answer plus the issue was not material plus tax is discussed in the due course of the conduct of any business plus have you ever considered trying the fact-fact-logical-inference thing instead of the stuck-on-stupid-reporter thing?

–Please elaborate on Overstock’s decision to avoid paying sales tax and to not disclose the identities of Moshe Krasnanski and Meyer Gniwisch.

Answer: I think you mean “collect sales taxes” and the law of this country requires us to collect sales tax in some cases and not in others and remind us again, What’s it like to go through life with a room temperature IQ? Can you hide your own Easter Eggs?

Thank you,

Roddy Boyd

Don’t mention it, Roddy. Remember, I’m always here to help.

Very respectfully,

Patrick Byrne, Journalist


PS I see Roddy just sent a follow-on:

From: Roddy Boyd [mailto:[email protected]] Sent: Thursday, January 14, 2010 12:53 PM
To: Patrick Byrne
Subject: one follow up question

Forgive the additional query, but it is germane.

The big diamond block, the trade you staked with Moshe and Meyer for about $7.5mm, appears to have originated from one Lev Leviev, a rather interesting man.

Leviev, outside of his NYC and West-Bank real estate operations, is also one of the more active miner and marketers of Angolan diamonds, an area whose extraction methods and principles are quite controversial.

Were those diamonds sourced from Angola? If so, could you elaborate on any debate you had with respect to doing this sort of business?

thank you

Roddy Boyd

Answer: Fred Norton went down the same line of questioning, and I’ll give you the same answer I gave him. No they were not sourced from Angola nor were they blood diamonds, and yes I conducted an investigation to that effect before doing the deal: said investigation consisted of asking my four Lubavitch rabbi friends plus the family patriarch (himself, a Ha-Shoa survivor who spends half his day in Talmudic studies) and having them tell me what I already knew, which is, that they would never engage in or draw me into any business which was not super-clean.

And thanks for playing, Roddy.

  1.  The answer is the same reason the media wallow around “light skin” or 
    Peter track stains on the sheets. 

    Many have nothing between the ears
    To work with. The only ability is to stir shit and hope someone will smell it. 

    We Americans are to dumb to understand wallstreet or the goverment dishonesty. If the shoe fits wear it.   

    Silly funnies that Americans do understand!  

      How all business phones should be answered…  ‘Good morning, welcome to the UNITED STATES OF AMERICA’  Press ‘1’ for english  Press ‘2’ to disconnect until u learn 2 speak english  And remember there are only 2 defining forces that have ever offered 2 die 4 u:  JESUS CHRIST…  and our AMERICAN SOLDIERS.  1 died 4 ur soul…The others 4 ur freedom.

     If u cross the north Korean border illegally u get 12 years hard labor…if u cross Iranian border illegally u get detained indefinitly….cross the Afghan border u get shot ….cross the Saudi border u will be jailed …..cross the Chinese border u will never be heard from again….cross the Venezuelan border u will b branded a spy and your fate sealed…cross the Cuban border u will b thrown n prison to rot…..however ..cross the U.S. border illegally…u get a job, a drivers license, a social security card, welfare benefits, food stamps, credit cards, subsidized rent or a loan to buy a new house, free education, free healthcare, the right to vote, and all without speaking a word of english.


  2. Patrick –

    I have to object to your language.

    You write:

    …“Roddy Boyd is a half-bright hedge fund shill” would have been a material event for New York Post, or Fortune, or whomever was then displaying the unfortunate judgment of employing you.”

    It should be “whoever.”

    Lila Rajiva

  3. Patrick, I’m fully on your side regarding the naked shorting problem in the markets today, but the way you lower yourself to a Roddy Boyd level in your email responses is unsettling. Why do you need to resort to personal attacks all the time? Be the bigger man and act as if you’re on TV. You always seem much more refined on television. The reason I say this is because it undermines your credibility. Keep up the good fight.

  4. Forget what Jackson says. No time to put the gloves back on. Personally, in an age of such vitriol and street language, I loved it. These morons have stolen the fabric from the capitalist system with the help of some obviously well – connected folks in politics and finance.

    Tell them your going to kick them in the teeth, then kick them in the balls and tell them your aim is bad. There is nothing left, and there is no time to waste. End it. And as the DOJ official said in a recent Senate hearing, “……..the only thing they understand is incarceration.” So, let’s get it over with.

    We have some half million folks a week losing their jobs. Soon, they will lose their homes, and all hope. Any student of history can tell you what comes next. Anarchy. We have very little time to restore law, order, honor and hope.

  5. Hi John –

    That’s your article you’re referring to? Not sure, since you say “someone.”

    From what I can understand of your comment, which seems to be the same one you left on my site a couple of times (?), you aren’t saying anything different from the anti-NSS people.

    Correct me if I am wrong there.

    Everyone is using the term NSS loosely, but in point of fact the anti-NSS campaign is concerned with techniques of many kinds, including the use of puts as well as the more complicated strategies you reference, in conjunction with the dissemination of false or misleading information through allied research firms and journalists. This can certainly lead to a downward movement in stock price, the write-down of assets and consequent loss of credit, which could in many circumstances prove fatal.

    Matt Taibbi harped on the Bear Stearns and Lehman attacks in the way he did perhaps because he came to the story late, has no experience in finance, and didn’t understand what he was talking about fully…


    He was engaged in a kind of controlled opposition expose, either intentionally or unintentionally.


    He just might be a sloppy journalist…. which would figure, since he also plagiarized and didn’t correctly attribute a lot of the NSS story, as well as his earlier story on Goldman Sachs.

    I do find it interesting, then, that you take up this issue with Deep Capture, when in fact it was Taibbi who spun the story into something solely about Bear and Lehman.

    If you read the articles on this site, you will see that most of them have to do with the Russian mafia’s infiltration of Wall Street, media collusion with hedge funds, the abuse of the market maker exception, the complicity of the DTCC and the problem of FTDs. Maybe they could add your concerns to these.

    I carry no water for Deep Capture and have criticized their tactics and language a number of times, but there’s no gainsaying that they have the goods on these issues.

    So I wonder why you keep seeing what they do as a replay of Taibbi’s story, when in fact it was Taibbi who took the work from here and reframed it to fit his political ideology, in the process leaving himself open as a target for more knowledgeable people to knock down.

    After his attempted hatchet job on David Griffin on 9/11 at Alternet, which exposed him to be playing considerably out of his league, I’ve come to the conclusion that Taibbi is, or has been, playing a role in confusing rather than clarifying the issues – again, perhaps without knowing and perhaps with the best of intentions.

    (I don’t mean to disparage his talents as a writer, the popular attention he brought the issue, or the many other financial stories on which his work threw light, BUT, on the two main stories, he actually preempted any credible telling of the tale by the sound and fury he generated).

    In any case, my point is that your criticism is actually off the mark in relation to this site, which even a cursory reading of the material on it will show.

    That being the case, I have to believe, respectfully, that political ideology is behind some of your criticism.

    (I understand you are a Democrat and so is Taibbi, as well as many of the financial journalists named here and their hedge fund allies).

    I wish I were mistaken in this diagnosis.

    And likewise, the media reaction seems to be nothing more than partisan spite.

    Rather than examine Deep Capture’s well-substantiated charges of mind-bogglingly unprofessional, unethical, and illegal behavior on the part of some journalists, behavior that’s directly responsible for a global CATASTROPHE, the media opens up its guns against the VICTIMS of NSS, rather than the guilty journalists and hedge-funds.

    In doing so they once again aid and abet what looks more and more like financial terrorism by a syndicate of players with close ties to organized crime.

    The media the world over is watching America’s major journalists for some slight awareness of their enormous culpability, for some signs of genuine remorse, some humility, and some desire to make amends to the millions of innocent people – indeed, whole nations – irreparable harmed by their professional negligence.

    Where is it?

    Lila Rajiva

    1. Hi Lila:

      Let me ask you a question. Assume an executive of a Investment Banking firm like J.P.Morgan or Goldman or Morgan Stanley knows of a take-over deal that will be announced in two weeks where the stock is expected to advance from 20 to 30 upon the announcement and goes out and buys 3000 calls that are expected to triple when the announcement is made.

      Then others find out about the deal and buy 6000 calls and others do spread trades to disguise their insider trades but are still bullish.

      Now when the announcement is made these guys make billions. I do not believe that anyone would say that the purchase of the calls caused the stock to go from 20 to 30.

      I believe that the large put buyers, and short sellers (both regular way and naked) were trading on inside information, which is done every day. To claim that “naked short sellers” together with rumor mongers caused the collapse of Bear Stearns and Lehman does nothing more that point the finger away from the true culprits. Those are the ones who arranged the collapse and pulled it off and shorted stock and bought puts prior.

      If they looked for inside trading, the finger would point to the Federal Reserve Bank Officers, JP Morgan, Dimon, Paulson and others who participated in the take down. In fact I believe that executives at J.P. Morgan and Goldman were short Bear Stearns, Lehman, Merrill, AIG and others early on, as hedges versus their holdings of their own equity compensation options and restricted stock. The money that was stolen is in the billions, giving them the power to influence corrupt regulators. So we all know that there was stealing in Bears Stearns and Lehman’s collapses, we just disagree on how and who did it.

  6. And, although this site doesn’t (and shouldn’t) focus on Overstock issues, since the Roddy Boyd line of questioning portrays the company as on its last legs from mismanagement, I thought I should post this for some balance: Maintains #2 Rank in Customer Service Among All U.S. Retailers, Trailing Only L.L. Bean But Besting Zappos and Amazon
    More News related to Press Releases
    January 13, 2010 8:45 AM EST

    SALT LAKE CITY, Jan. 13 /PRNewswire-FirstCall/ —, Inc. (Nasdaq: OSTK) announced today that it has once again earned the #2 spot in customer service rankings among all U.S. retailers, according to rankings published in the 2010 NRF Foundation/American Express Customer Service Survey. Source: [ and’s rank surpassed online retailers (#3) and (#4), and is only behind #1 ranked L.L. Bean

    “Outstanding customer service begins and ends with a retailer’s core belief that every single customer is important,” said Kathy Mance, Vice President, NRF Foundation. “ has continuously demonstrated this philosophy and we congratulate them on their recognition as one of the best retailers in customer service.” CEO Patrick Byrne said, “All credit goes to my 1,000 colleagues, and especially, our Customer Care agents. Under the direction of SVP of Marketing and Customer Care Stormy Simon and VP of Customer Care Brian Popelka, our Customer Care team has made us a customer-centric organization. It is because of them that in the last five years has gone from being unranked to being #2 for the second year in a row. We would like to thank the consumers of America for speaking so highly of us: there are a thousand folks here that are gratified to know that their hard work is so appreciated.”

    Byrne continued: “Congratulations to the other retailers who were ranked in the top 10. It is an honor to be ranked among such fine companies. And I look forward to 2010’s rankings.”

  7. Many thanks to all.

    Jackson, yes, the language may cross the saltiness line, I agree: It is hard for me sometimes to express my contempt for Roddy (and a few of the other characters involved) without resorting to terms scatological or metaphors involving debasing one’s self for pay. I agree, this is a reflection of my own limited abilities.

    Lila, I love your work as well. But I do believe it is “whomever” here (“…would have been a material event for … whomever was then displaying…”). Object of the preposition “for”. However, I also get the subtle humor of your remark, and applaud.

    DCN – Right on with the stuff from John Boyd (no possible relation to Roddy, I assume).


  8. Jeremiah, Patrick –

    You are wrong, luvvies….or at least, I am more correct.

    Salty language is forgivable, but we cannot suspend the laws of logic (and this is a logical item) even for Roddy Boyd.

    When the object of the preposition (in the main clause) is a relative CLAUSE (“whoever is….”) and when “whoever” is also the SUBJECT of the verb “is” in the aforementioned relative clause – then whoever is in the nominative…

    If it had been, say, “whomever he met there”, “whom” would then be both the object of the preposition in the main clause AND the object of the verb “met” in the relative clause. Then indeed you would have been right.

    Maybe it’s a British versus American thing.
    But I don’t think so.

    Even if you defend yourselves on the grounds that King James, Defoe, Shakespeare and others have gone with “whom” in similar circumstances (rhetoric being a stronger argument than logic), you will have to contend with the fact that they did so when “whom” was at least mellifluous. That is, their uses SOUNDED right.

    But, you’re out of luck on that count, because besides being illogical, ‘whomever’ sounds simply awkward here.

    In grammar, go with style..


  9. Hi John –

    Absolutely. I completely agree. I don’t think anyone would say that speculation alone caused the collapse. There had to have been a number of other things going on.

    Anticipating something and causing it to happen are two different things. Sure. Np argument there.

    On the other hand, I don’t think people actually know what transactions took place and when. So any theorizing is only that.

    If you jump off a cliff, the fact that you had high cholesterol is immaterial to your death, yes. (That’s Ritholtz on his blog, dismissing concerns about NSS – which he treats incorrectly in the narrow sense).

    But that analogy can be turned around. Maybe you died because you jumped off the cliff. But maybe, also, an autopsy shows that someone got you dead drunk just before, and then took you out to the cliff at midnight. And maybe that same someone had taken out an insurance policy on you…

    And had a history of taking out insurance on people who promptly fell off cliffs.

    Wouldn’t that change the narrative a bit?

    One more thing. All this talk about needing “smoking guns” to prove guilt is also misplaced.

    Not every murderer needs to have been witnessed in the act in order to be found guilty. There is such a thing as circumstantial evidence, and when there is enough of it and when motive and opportunity are also present, there is NO reason to flinch from drawing conclusions.

    The rest is a lot of bunkum to confuse people who don’t know better.

    Remember, no one really even knows if T+3 is really when these trades were settled. And because of the clearing system, we don’t know how the BD’s wrote off trades against each other. And the records aren’t forthcoming.

    Actually, given the magnitude of what happened, if all the relevant parties don’t cough up every scrap of paper or digital finger print remotely relevant to what happened, and don’t scramble to do it, we’re going to have to assume bad faith.

    And even if every last one of these gents had only the purest of motives, there’s also the matter of incompetence and negligence of the most colossal kind.

    I mean, if you get drunk and drive your truck through a school yard filled with toddlers and kill a dozen of them, the fact that you didn’t know what you were doing isn’t going to be enough.
    You’ve been criminally negligent.

    So, whichever way you cut it, the Fed Reserve, JP Morgan, Goldman, and some allied funds, are in it up to their necks.

    As for the media, enough has been said. In my opinion, some journalists need to be strung up higher than the banks.
    Financiers, after all, are money men. No one expects much better from them.

    But journalists? Prattling endlessly about the sanctity of the fourth estate, tearing everyone else down, making and breaking careers and reputations, not just in the US, but all over the world – what about them?

    Why are they assumed to be beyond criticism?

    Where are the resignations?

    Wnere is the contrition?

    On the contrary. They’re busy making up history out of whole cloth, giving each other prizes, and vilifying the people who got it right!

    The sheer gall is enough to make anyone give up in despair.
    Except, of course, there were many people who spoke out, who did what they were supposed to do, and who got it right….We have to take comfort in that.

    It’s just too bad that it’s not those people who are in the driver’s seat..

  10. John Olaques

    We all want to know if naked shorting broght down Bear and Lehman (NSS, of course combined with trading on inside information). If the spike in fails occurs after the price crash, that’s to be expected. A fail is not recognized until several trading days AFTER the trades too place. So the data does not in fact support your argument that NSS trades happened after the crash. When you adjust for the delay in recognizing the fails, the data supports the hypothesis that NSS attacks brought down Bear, Lehman, Fannie, Freddie, abd others, even Goldman was getting hammered until the SEC shut down short selling entirely for a while.

  11. Here’s a snip-it from Book #9 and a letter to Congress in re:the proximate cause for the Bear Stearns and Lehman Brothers share price evaporation. This doesn’t address the ancillary roles of CDS’s, pulling of credit lines, put options,…Certain events placed them at the edge of the cliff but the autopsy clearly shows that they were pushed.

    “I would refer you in Congress to the results of a very exhaustive “post-mortem examination” performed on these two admittedly damaged corporations by Dr. Rob Shapiro the Clinton administration’s former Under Secretary of Commerce and Dr. Nam Pham released in April of 2009. You can study their findings at

    As you will notice in the Bear Stearn’s attack from the first quarter of 2007 to March of 2008 although “declared short sales” (“short interest”) increased an incredible 4-fold their failures to deliver (FTDs) increased an astronomical 145-fold. Similarly, in the case of Lehman Brothers from the third quarter of 2007 to September of 2008 their “declared short sales” also increased 4-fold but their FTDs increased a mind-boggling 151-fold. Despite these remarkably aberrant statistics to this very day the SEC, the DTCC, the Wall Street lobbyists and FINRA still feel compelled to stick to their story. WHY? What might the repercussions be if the truth be told as to the integral role of abusive short selling crimes in the demise of these corporations and the near demise of our entire financial system? Note that these massive increases in “strategic” (Dr. Leslie Boni 2003) delivery failures in these two corporations illustrate the concepts of “targeting” a corporation deemed to be at least temporarily an “easy prey” as well as the concept of perpetrating criminal activity while “working in concert” i.e. “racketeering”.

    Unlike an increase in a corporation’s declared “short interest” even a mild increase in FTD levels might imply the intent to defraud. The benchmark to evaluate in regards to “intent to defraud” issues is the increase in FTD levels above the historical norms for that particular corporation. Perhaps even more impressive than Bear Stearn’s 145-fold increase in FTDs is the fact that this represented a 57-fold increase in FTDs above the previous all-time “high water” mark. Only corrupt Wall Street bankers, “deeply captured” regulators and conflicted SROs in the midst of a gigantic cover-up process could possibly refer to statistics like these as mere “background noise” that should be filtered out.”

  12. But wait the statistics get much, much more aberrant when you factor in how the NSCC’s CNS operates:

    “In regards to the Bear Stearns and Lehman Brothers attacks one might intuit that abusive short sellers willing to induce the triggering of the potential systemic risk repercussions and the inevitable microscopic scrutiny of their actions associated with attempting to take down two systemically important institutions would not direct the clearing of these nefarious trades through the NSCC’s CNS system for all to see. It’s a bit hard to appreciate but the 145-fold and 151-fold increases in FTDs are actually grossly low. The question begging to be asked is whatever happened to the inevitable microscopic scrutiny of the trading data. If it did occur then why were the results covered up?

    One must also keep in mind that the 145- and 151-fold increases in FTDs only address those FTDs that survived “pre-netting” at the CNS. One would also have to factor in the FTDs held at trading desks via “desking” or “broker/dealer internalization”, those held in “ex-clearing arrangements” between abusive clearing firms, those held in Canadas’s “Central Depository for Securities” or “CDS”, those held in other clearance and settlement systems offshore, etc.”

  13. I’m sorry for stealing bandwidth but I think there is an opportunity for the DeepCapture folks to advance an important notch on their own NSS learning curves. The question arises WHY would the SEC, the DTCC and FINRA make the insane utterance that a 151-fold increase in FTDs had nothing to do with Lehman’s demise? The answer is that they have to at this late hour.

    What might happen if U.S. investors learned that the Bear Stearns and Lehman Brother’s statistics were not that atypical when a U.S. corporation falls into the “easy prey” category as they did? What might happen if U.S. investors suddenly realized that development stage U.S. corporations all go through a stage of development in which they present as an “easy prey” to abusive Wall Street insiders and their hedge fund “guests”?

    What might the repercussions be if U.S. investors learned that many of their past investments in development stage corporations never did have a chance for success while the congressionally mandated providers of investor protection i.e. the DTCC, the SEC and FINRA sat passively by and monitored the blood-letting? These crimes have to be covered up when the investing public becomes suspicious even if it’s a little embarassing for “securities cops” to proffer that a 151-fold increase in FTDs was “background noise”.

    Here’s the rub; by definition these congressionally mandated providers of investor protection cannot simultaneously be in “cover-up” mode at the same time they are supposedly providing robust investor protection.

    The sad history of our markets in relation to abusive short selling frauds have our current “securities cops” handcuffed and the perpetrators of these frauds know it. That’s why the gross fraudulent conduct with BS and Lehman occurred without anybody worrying about any adverse consequences. There needs to be a day of reckoning wherein all current FTDs over a certain age are bought in and those shares are finally delivered to their purchasers. This will unhandcuff our securities cops and allow them to shift from cover up mode to investor protector mode.

  14. Anyone other than myself ever wonder why Roddy Boyd, Gary Weiss et al are so preoccupied with Dr. Patrick Byrne as such a bad CEO, that they have forgotten to write about the likes of Chuck Prince, John Thain, Vikram Pandit, John Mack, C. Mazzillo (sp) of Countrywide,amongst others who have run their companies into the ground thus needing multibillion dollar taxpayer bailouts, destroying shareholder value, other business’ loss of homes to forclosure, while paying themselves enormous, underserved bonuses. Why not leave the man who has managed to keep his comppany afloat in these difficult financial times to continue to run his company without bailouts or costs to taxpayers? There must be a reason right guys? Someone please explain it to me like I’m a five year old because I am truly at a loss here.

  15. does anyone else find it odd that the sec has not yet released the fails to deliver data report for the second half of December? i was expecting its release monday but realize monday was a federal holdiay. here we are wednesday january 20th, less than 1/2 hour until the market closes and still no current information to replace the “Report for the first half of December 2009” with the second half of December.
    …”Data Starting July 2009
    Starting July 2009, each month is contained in two files. The first half of a given month is available at the end of the month. The second half of a given month is available at about the 15th of the next month.”…

    1. finally the sec updated the ftd report information to make available the second half of december 2009 data, late in the day january 21, 2010. might someone be able to enlighten me as to when the ftd’s reported by the sec clear, where the volume is recorded ie premarket, afterhours or during the day and which day? it seems to me they are recorded with the closing price of the previous day, and clear the following day. are there fines associated with forced ftd’s?

  16. Just to bring a little fairness and balance into the debate, Mr. Antar should maybe answer some questions about himself before he raises them about others. Interesting that the Wall Street media is concerned with the arcana of accounting but not the basics of swindling:
    Sam E. Antar: The Big Fraud Continues

    Sam E. Antar
    Sam E. continues to malign me as anti-semitic becuase I keep exposing him as as convicted fraudster who stole hundreds of millions of dollars and cannot be trusted
    By Edward Manfredonia
    December 21st, 2009

    [Policing Wall Street]

    In a previous piece, “Whitewashing Crazy Eddie’s Cuz Is Insane,” which appeared in The Black Star News on October 28, 2009, I wrote about Sam E. Antar, a convicted felon who assisted in the stock fraud, Crazy Eddie. Crazy Eddie was a stock fraud, which involved the old inventory scam and inflated sales figures.

    Like most felons, Sam E. has portrayed himself as the mastermind of the criminal activity in which he participated. Unfortunately for his ego, the real mastermind of the Crazy Eddie stock fraud was Eddie Antar, Sam E.’s cousin and the founder of the Crazy Eddie electronics empire. But the media loves a self-proclaimed penitent and Sam E. has become a media darling.

    Sam E. has appeared on Herb Greenberg’s television show on CNBC. Sam E. has appeared on Larry Kudlow’s CNBC television program.

    (Greenberg did not respond to my request for comments. A spokesperson for CNBC responded this way on behalf of Kudlow: “Sam Antar has appeared on CNBC once in the last three years to argue infavor of more resources to combat insider trading and stricterenforcement. His convictions were disclosed.”)

    Sam E. recently wrote a little piece about Bernard Madoff for Newsweek. Sam E. has been praised in Fortune, December 25, 2007, in an article, “Takes One To Know One,” by Peter Carbonara, and in Crain’s New York Business, in an article, “Crazy Like A Fox,” by Aaron Elstein, on October 4, 2009. I personally debunked the Crain piece in my article, “Whitewashing Crazy Eddie’s Cuz Is Insane.”

    But to paraphrase Shakespeare, I have not come to praise Sam E. I have come to bury him; and I shall accomplish this by exposing a dark secret.

    Sam E. has publicly stated on various internet message boards that he has donated his time and his wife’s money (yes that is correct his wife’s money) to expose stock frauds and fraudulent accounting practices. Sam E. was very proud of his wife’s largesse and stated that the money came from his wife’s family, which is heavily involved in real estate.

    Sam E.’s wife, Robin, was so generous that, according to Sam E.’s internet postings, Robin permitted him to give $250,000 to Barry Minkow, another convicted felon. Minkow masterminded the stock fraud ZZZZ Best, which cost the American public in excess of $100 million in the 1980s. Sam E. said that he admitted Minkow’s prowess in exposing fraud. Of course the money was donated to Minkow’s Fraud Discovery Unit- and not to Minkow personally. And there is an excellent financial reason for that. Minkow’s salary is being garnished because he owes the federal government $16 million, which Minkow illegally earned in his stock fraud.

    As for the origin of the $250,000 some internet bloggers have questioned if the money truly belonged to Robin or if Sam E. were passing along money from short sellers and class action attorneys.

    There have been some unfortunate developments for Sam E. Robin has not been feeling generous anymore. Or perhaps Robin became too upset with Sam E.’s antics and his addiction to his computer and his internet postings.

    How do I know that Robin does not feel generous to Sam E. anymore?

    Robin filed for divorce in 2007 in Kings Civil Supreme Court. The index number is 043286/2007.

    What does this mean? Well it entails a small discussion of Jewish law. And the last time I explained Jewish law to Sam E., he called me an anti-Semite: Just because I pointed out that Sam E. had violated the Ten Commandments of Hashem as well as many of the 613 mitzvoth, which Orthodox Jews must observe.

    Surely you remember the Ten Commandments including: “Thou shall not steal” and “Thou shall not lie.”

    Well Sam E. stole and he committed perjury. Yes, he testified against his cousin, but that was after he was given permission by a Rabbi. (This has been recounted in my lawsuit for my FBI files, 08-CV-01678-SLT-LB.)

    In Orthodox Judaism, especially among Syrian Jews in Brooklyn, a woman cannot initiate a divorce. Only a man can initiate a divorce. And this is accomplished by giving your wife a “get;” this means that your former wife can remarry.

    In Orthodox Judaism divorces, at least those where a man grants a woman a divorce by providing his former wife with a “get,” are decided in a rabbinical court, a bet din. The distribution of property is even decided by the rabbis. Thus, Orthodox Judaism is like Sharia (Islamic) law in many instances with the religious authorities deciding the divorce.

    But it is apparent that Sam E. has not granted his wife a “get;” so Robin has sued in civil court.

    Matrimonial proceedings are sealed. So, I have not been able to read the court filings. But it appears to me that Sam E. does not wish to let the “free ride” on his wife’s money disappear.

    And Sam E. has no assets. Sam E. declared bankruptcy in the 1990s. And Sam E. has not been gainfully employed. Sam E. boasts that he donates his fraud spotting services for free- while being supported by his wife.

    Sam E. repeats lies ad nauseam. Even though the Anti-Defamation League has said in a letter, dated July 2, 2007, that my comments about Sam E. and his violations of Talmudic Law were not anti-Semitic, Sam E. has continued to deride me as an anti-Semite- just because I know that a convicted fraudster, who stole hundreds of millions of dollars, cannot be trusted.

    In February 2008 Robin filed for an Order of Protection against her husband, Sam E. Antar. Robin withdrew the request for an Order of Protection the next day.

    Yet on April 8, 2009 at the request of Robin, Judge Rachel Adams issued an Order of Protection and a Restraining Order against Sam E. Antar.

    And this restraining order has remained in effect.

    What do Sam E. Antar’s friends, Larry Kudlow, Herb Greenberg, Howard Sirota, and those investigative reporters at Newsweek, Fortune and Crain’s have to say about all this?

    Stay tuned and we will find out.

    Please post your comments directly online or submit them to [email protected] to avoid truncation

    “Speaking Truth To Empower.”

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