Saturday, June 30, 2007

The U.S. Chamber of Commerce Has Some Explaining to Do

A reader brings to my attention a May 2007 press release from the naked shorting poster child Universal Express. The release says that Universal Express CEO Richard Altomare has been appointed to three committees of the United States Chamber of Commerce.

Yup, that's the same Universal Express that has been found by a federal court to be a multiple securities law violator, in cases stretching back to 2004. Its received some publicity in recent days for its tussle with New York Times columnist Floyd Norris.

In a recent court filing requesting that a receiver be appointed to manage the company, the SEC said:

As has been found by Court, Universal Express has since 2001 existed primarily as a vehicle to flood unregistered stock into the public market at values fraudulently inflated by the dissemination of false and misleading statements by Universal Express, Altomare and [general counsel Chris] Gunderson. Recent public statements by the company and Altomare demonstrate that this conduct is continuing unabated. Altomare’s public statements demonstrate that, absent the imposition of a receivership, additional illegal conduct that is harmful to public investors will occur.
According to the Universal Express press release, "Altomare was invited to serve as a member of Homeland Security Policy and Task Force, the Regulatory Affairs committee and the Transportation and Logistics Committee."

The Chamber has a history of opposing investor and consumer interests, and is essentially a mouthpiece for big business interests in Washington. In keeping with that record, it has supported efforts by inept corporate chieftains to shift blame to "naked short selling." Altomare, of course, has been flapping his big mouth about that non-issue for years, making him a leading troubadour of the Baloney Brigade of penny stock merchants and crackpots.

But even for the Chamber, appointing an Altomare to three committees is over the top.

I'd say the Chamber has some explaining to do.

UPDATE: The SEC on Friday asked a federal court judge in New York to find Altomare, general counsel Chris Gunderson, and Universal Express in civil contempt to prevent further violations of the securities laws. If the SEC gambit is successful, the two will wind up in a place where baloney sandwiches are common fare -- jail.

Read the blood-curdling details in the court documents linked here.

Universal Express responded, as it always does, by issuing a press release. Apparently the SEC sent the company a subpoena demanding that it prove its naked shorting jibberish. The nerve!

". . . . This continuing attempt at abuse of power against our Company and many other 'whistleblowers' on 'naked shorting' is ironic coming from an agency that has permitted trillions of unregistered and counterfeit shares to be issued in the names of smaller public companies, putting over 6,000 of such companies out of business and destroying the investments and jobs of hundreds of thousands of Americans," continued Mr. Altomare.

"The SEC simply misunderstands the facts about our shares, which have been properly issued and clearly recorded in our published reports; while the SEC has illegally permitted marketmakers, broker-dealers and hedge funds to secretly issue trillions of counterfeit shares in companies' names in violation of the Counterfeiting Statutes of the United States. They have committed and continue to allow trillions of crimes to occur daily."

The Baloney Brigade marches on.

© 2007 Gary Weiss. All rights reserved.

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