Tuesday, December 09, 2008

Wrapping Baloney in the Flag

Jeff Matthews has an enjoyable item today on one of the more loathsome conspiracy theories being circulated on the Internet: that "naked shortsellers" are attacking a company called Force Protection, and that by some twisted logic "American soldiers were being punished by naked short selling."

Though not mentioned by Matthews for some reason, the author of the Big Lie described in his item is none other than the most the entertaining CEO in America, the always entertaining overlord of Overstock.com, Patrick Byrne. Showing his customary good taste, Byrne illustrated his item with a photograph of flag-draped coffins (above).

Byrne, when not driving his creepy little company into the ground, spends most of his time writing nutty items for an Overstock-hosted blog called "Deep Capture." His latest missive claims that Force Protection, which makes vehicles for the Army in Iraq, was a victim of naked shorting.

Matthews notes that the company actually is a victim of itself. Apart from competitive factors:
. . . Force Protection has had a few issues particular to itself.

Not being in compliance with Nasdaq Marketplace Rule 4310 (c)(14) for a period of time, as a result of not filing its June quarter 10Q, for one.

Announcing in August, 2008 that its 2007 financial statements “should no longer be relied upon,” for another.

Announcing it had identifyied “material weakness in its internal control over financial reporting,” in November 2007, for a third.
Hey, sounds a lot like Overstock.com. The difference is that Force Protection's management has not, as far as I know, endorsed the screwball theories being advanced by Internet creatures like Byrne. (And not repudiated them either, for that matter.) As I pointed out a few months ago, a member of Overstock's somnolent board of directors, Joseph Tobacco, is representing investors suing Force Protection.

I said at the time that Tobacco has some explaining to do. He still does, in spades. It's hard for me to see how Tobacco can represent aggrieved Force Protection investors while serving on the board of a company that officially sponsors a website publishing crap like this about Force Protection and taking an anti-investor slant in general.

Byrne's latest craziness is par for the course for naked shorting nuts, but wrapping the flag around their conspiracy theories is especially odious, even by their standards.

Obviously Byrne is exploiting the Iraq dead as a kind of publicity stunt -- the Deep Capture website, though run by a full-time staff of thugs lead by the nauseating cyberstalker Judd Bagley, has failed to gain much readership despite constant hyping, a "$75,000 contest" that fizzled, and a link on the Overstock site. But I doubt very much that the parents of the Iraqi war dead appreciate this crass exploitation of their tragedy.

© 2008 Gary Weiss. All rights reserved.

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