Patrick Byrne Pulls a 'Reverse Dick Nixon'
Patrick Byrne admits the obvious
Forensic accountant Tracy Coenen observes today that Overstock.com CEO Patrick Byrne has admitted what has been obvious for ages: that he is a crook.
This is a refreshing gust of honesty from the famously dissembling Byrne, who has made a second career out of hounding analysts and members of the media who call him to account for his serial lies. Unlike Dick Nixon, who famously said "I am not a crook," Byrne is forthright in admitting his crookedness.
She notes that Byrne said as follows in a CNBC telecast in 2004:
The "gap" in the transcript is supposed to be "GAAP" -- generally accepted accounting principles -- which Byrne has disregarded when it suits him. Tracy and Sam Antar have been hammering away at that point for some months now.
Well, first of all, I’m all about gap. [sic] I have been so critical of the companies that do–I don’t believe in one-time charges; I don’t believe in EBITDA. If somebody talks EBITDA, put your hand on your wallet; they’re a crook.
Sam Antar adds:
The double talking Patrick Byrne not only likes EBITDA, he also likes to violate Securities and Exchange Commission Regulation G and materially overstate EBITDA in Overstock.com's financial reports. My blog and Tracy Coenen’s blog have detailed Overstock.com’s SEC Regulation G violations and resulting material overstatements of EBITDA in its financial reports starting from Q2 2007 and continuing to Q1 2008.Indeed, Byrne's latest stock-pumping conference calls have been EBITDA-love-fests. Tracy's blog has a good analysis here on how Byrne has not only "talked EBITDA" but overstated it.
Tracy concludes, "I agree with Patrick: He is a crook." I agree with him too on that point. Whenever he talks about EBITDA (or stamp collecting, or ornithology, or if it is raining outside), put your hand on your wallet. A crook is talking.
I guess it's time for the SEC to wake up from its slumber, conclude a nearly two-year-old investigation and make it unanimous.
© 2008 Gary Weiss. All rights reserved.