Monday, August 04, 2008

Naked Shorting Crusaders Busted By SEC

The SEC last week took action against a pair of stock promoters named Brent Pierce and Grant Atkins, accusing them of securities fraud by selling unregistered stock.

What makes this obscure SEC action interesting, as Carol Remond points out in Dow Jones News Service (article unavailable on the Internet), is that these two charlatans are author of an even greater fraud: the naked shorting con game now being promoted by the ancestral wealth of Overstock.com CEO Patrick Byrne.

Says Carol:
Back in 2002, Atkins and Pierce were associated with Investor Communications International Inc., a Blaine , Wash. , promotional firm that was a large investor in a budding pharmaceutical company named GeneMax Corp.
As I reported in Business Week way back in 2003, ICI was the home of an astroturf group called the National Assn. Against Naked Short-Selling, which organized a mass mail-bomb campaign in favor of Regulation SHO in 2002. Spurred by this nonexistent "public pressure," the SEC proceeded to waste significant resources chasing down a problem that does not exist--surely the most lamentable waste of SEC resources in its history.

NAANS was succeeded in 2004 by the Byrne-funded National Coalition Against Naked Shorting, and since has become a kind of one-man lunatic fringe controlled by the nutjob Overstock.com CEO personally.

Carol goes on to point out how other past leaders of the anti-shorting Baloney Brigade, notably Richard Altomare of Universal Express, have been serial fraudsters. She concludes:

All fine examples of companies and insiders complaining of naked short selling whom Chairman Cox might want to consider before extending his restrictive short-selling order to other securities.
Cox indeed is thoroughly aware of the fraudulent nature of the anti-shorting jihad, as he himself noted publicly at a congressional hearing in the late 1980s. But the SEC's priority is not to protect investors, but self preservation -- to protect the reputation of an agency that did an abysmal job in handling the credit crisis and its impact on Wall Street banks. So don't expect that Cox or his minions will pay any attention.

© 2008 Gary Weiss. All rights reserved.

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