'Who's Bud Burrell?' and Other Questions Richard Altomare Won't Answer

Altomare is suddenly speechless on naked shorting

Naked shorting poster child Universal Express is a prime example of how corporate executives use stock market conspiracy theories to cover up their own sleaziness and, sometimes, criminality. Just take a look at the court documents on the company's web site, and particularly the latest filing -- a fascinating deposition by CEO Richard Altomare on Nov. 27.

You really should read through that deposition -- it is a hoot. It reads like something out of a Kefauver Committee hearing on organized crime in the early fifties, with Altomare refusing to answer most of the questions posed by the court-appointed receiver, Jane Moscowitz, on Fifth Amendment grounds.

While I'm sure that prosecutors will be most interested in persistent questions by Moscowitz implying that Altomare looted the company, my favorite was this:

Q. Did you ever seek to have any records analyzed that would determine whether, in fact, there had been naked short selling of the stock of Universal Express, Inc.?

A. I respectfully decline to answer that question based upon my constitutional rights as guaranteed to me by the 5th Amendment of the United States Constitution and the same rights provided to me in the Constitution of the State of Florida.

Q. In fact, you don't really know whether there has been any naked short selling of the shares of Universal Express, do you?

A. I respectfully decline to answer that question based upon my constitutional rights as guaranteed to me by the 5th Amendment of the United States Constitution and the same rights provided to me in the Constitution of the State of Florida.

Q. It's merely been a convenient thing that you could tell shareholders while their shares went down to an amount that I don't even know how to express what point .00001 is?

A. I respectfully decline to answer that question based upon my constitutional rights as guaranteed to me by the 5th Amendment of the United States Constitution and the same rights provided to me in the Constitution of the State of Florida.

So in other words, a CEO who had once been a leading troubadour of the Baloney Brigade anti-naked-shorting movement -- he has a prominent role in Wall Street Versus America -- is now not only clamming up on the subject, but says that talking about it may incriminate him in a criminal act. In what criminal act, I wonder. Lying to shareholders, perhaps?

It will be interesting to see how Patrick Byrne, who has made similar claims about naked shorting and stock market conspiracies, will fare when his chance comes to provide a deposition to the SEC, which is investigating him and Overstock.com on a variety of things. Naked shorting claims are mentioned in the subpoenas, according to Overstock SEC filings.

As I suggested (see update to this item) some weeks ago, Moscowitz also bore down on Altomare about his links to the crackpot Bud Burrell, a penny stock operator and regular on the now almost-defunct "thesanitycheck" stock market conspiracy website. The result was more stonewalling:

Q. Who's Bud Burrell?

A. I respectfully decline to answer that question based upon my constitutional rights as guaranteed to me by the 5th Amendment of the United States Constitution and the same rights provided to me in the Constitution of the State of Florida.

Q. Is Bud Burrell on the Universal Express payroll?

A. I respectfully decline to answer that question based upon my constitutional rights as guaranteed to me by the 5th Amendment of the United States Constitution and the same rights provided to me in the Constitution of the State of Florida.

Q. Didn't Bud Burrell have a company called Quantum Matrix that you were paying $4,000 to every so often?

A. I respectfully decline to answer that question based upon my constitutional rights as guaranteed to me by the 5th Amendment of the United States Constitution and the same rights provided to me in the Constitution of the State of Florida.

Burrell has already said publicly that he was on the payroll and was a "significant" unsecured creditor, and also made vague threats against no one in particular that, if I were Ms. Moscowitz, I would take seriously.

Altomare can run from these questions, but he can't hide. The company is under FBI investigation, and Moscowitz indicated that still more subpoenas are flying.

She's particularly interested in jewelry purchases for Altomare at corporate expense, which Altomare--in one of the few questions he did answer--lamely claimed had come from "salary" directly sent to the jewelers.

© 2007 Gary Weiss. All rights reserved.



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Wall Street Versus America was published by Penguin USA on April 6.
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