***********The Best Coverage Money Can Buy*********
Bloomberg Personal Finance,
April, 2000
Investors sometimes assume that if a stock is covered by one or more brokerage houses, that means they have a fundamentally favorable opinion of the stock's merits. That isn't necessarily so.In the extreme case, brokerage firms (mainly small ones) accept financial inducements to provide coverage. For example, in 1998 J-Bird Music Group (JBRD) retained Security Capital Trading (run by the well-known but controversial analyst Ray Dirks) for advisory services. Security Capital issued a favorable report on J-Bird, which provided Security Capital with 500,000 shares of restricted stock. The existence of those shares was not mentioned in the report. Perhaps you think that such arrangements are a little less than arm's length. But that is only one gross form of the Wall Street coverage game. There are many other forms. Companies that dole out stock offerings to major investment-banking firms have certain (often unspoken) expectations about research coverage. They expect: (1) that the investment banking firm will cover the stock, (2) that it will say favorable things about it, and (3) that it will provide a "booster shot" of favorable coverage not long after the stock offering. These expectations apply to any offering, but especially to the first one, the initial public offering. Brokerage houses that violate these norms often find themselves frozen out of a company's next offering, a fate worse than death these days! --JD
J BIRD MUSIC GROUP LTD, filed this on 06/11/1998.
32.2% IMM International, Inc. 2,270,000 24.7 Douglas G. McCaskey 450,000 4.8 Hope D. Trowbridge 250,000 2.7 Asa L. Fish
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CEO,President and October 7, 1997 Di rector Douglas G. McCaskey 42 Chairman and Director April 28,1997 Hope D. Trowbridge 37 Secretary, Treasurer June
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Director as well as serving the same positions for J-Bird Music Group LTD as of October 7, 1997. DOUGLAS G. McCASKEY, Chairman and Director of the Company. Mr. McCaskey is a graduate and MBA candidate of Babson College,
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U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
LITIGATION RELEASE NO. 17520 / May 16, 2002 DOUGLAS G. McCASKEY ORDERED TO PAY $100,000 CIVIL PENALTY SEC v. Douglas G. McCaskey, et. al., 98 civ. 6153 (SWK) (S.D.N.Y.)
United States v. Douglas G. McCaskey, 00 cr. 219 (SRU) (D.CT.)
The Securities and Exchange Commission today announced that the U.S. District Court for the Southern District of New York issued an order on May 1, 2002 directing a Connecticut stock promoter, Douglas G. McCaskey, immediately to pay a $100,000 civil penalty in connection with a scheme to manipulate the market for Marcorp, Inc. stock during 1994. The Court previously found that McCaskey had committed securities fraud in connection with the scheme, found McCaskey substantially unfit to serve as an officer or director of a public company, and barred McCaskey from serving as an officer or director for a period of six years. The Court also permanently enjoined him from violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Section 17(a) of the Securities Act of 1933. See Litigation Release No. 17131 (September 18, 2001). McCaskey was sentenced to five years probation and ordered to pay a $30,000 fine on April 30, 2001 in the U.S. District Court for the District of Connecticut in connection with related criminal charges brought by the U.S. Attorney for the District of Connecticut. McCaskey had, on October 13, 2000, pleaded guilty to criminal charges that he violated Section 10(b) of the Exchange Act and Rule 10b-5 by manipulating the market for Marcorp, Inc. stock from May to December 1994. See Litigation Release No. 17056 (July 2, 2001). sec.gov
Ray Dirks of Security Capital Trading, Inc. Recommends J-Bird Music Group (OTC Bulletin Board: JBRD) as Strong Internet Growth Stock
WILTON, Conn., July 21 /PRNewswire/ -- J-Bird Music Group, Ltd. todayannounced that it has established an investment banking relationship with thefirm of Security Capital Trading, Inc. Ray Dirks, the well-known securitiesanalyst, is currently recommending the purchase of J-Bird stock, the Wilton,Connecticut-based Internet record label. This comes on the heels of J-Bird'srecent announcement of the signing of rock legend Billy Squier, who has soldmore than 15 million records during his illustrious career.In a 14-page analysis of the company's two-year history and prospects,made public on July 13, 1998 by Security Capital Trading, Inc., J-Bird Recordsis recognized as a company with "huge potential that has not yet beendiscovered by the investment community." The study concludes with therecommendation that "shares of J-Bird are recommended for purchase by veryaggressive, long-term growth oriented investors who are seeking a low-pricedstock that offers a considerable upside potential.""We are extremely impressed with the innovative game plan of the company'sdynamic leader, Jay Barbieri," said Dirks of Security Capital Trading, Inc."The size and growth prospects of the CD segment of the recorded music marketbeing addressed by the company makes use of the Internet to gain exposure fornew artists, as well as formerly successful ones, and takes advantage of thealready well entrenched recording industry marketing and distributionchannels.""Although many Internet-based companies are currently celebratingtremendous success, I believe that continued growth is only inevitable forthose companies like J-Bird that own its content," said J-Bird Music Group'spresident and CEO, Jay Barbieri. "By having this recommendation, from RayDirks, it marks yet another step in our efforts to move toward expanding ourimpact on the recorded music marketplace."In addition to its own record label, web site(http://www.j-birdrecords.com) and 24-hour Web radio station, J-Bird MusicGroup, founded in 1996, has established a relationship with AT&T's a2b musicservice, whose web site will soon permit customer access to J-Bird's artistmusic. J-Bird has also entered into a national distribution agreement withNavarre Corporation, one of the United States' largest distributors of musicto retail outlets. Their 50,000 accounts include Best Buy, Blockbuster,Borders, Circuit City, HMV and Tower.The full report and analysis can also be accessed athttp://www.raysearch.com.SOURCE J-Bird Music Group, Ltd.
Web Site: j-birdrecords.com
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