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To: Francois Goelo who wrote (1362)	10/17/1999 11:55:00 PM
From: who cares?	Read Replies (1) \| Respond to of 1567

Wake up Francois "Frankly, the incidents of actual naked shorting is much, much less than people think it is. Most of the cases referred to in the memos and press deal with instead illegal insider selling. Insiders and promoters in "pump and dump" schemes take big blocks up stock up north and use Canadian brokers to dump it into the market." You know what they're talking about don't you, you know, like the way XNET tanked when all the private placement people shorted against their locked up shares. Again, that article doesn't mention any new law or regulation, or say anything about your October 23 deadline, it just says that the brokerages are doing it volunteerily. Basically they're trying to get rid of the bad apple insiders and scummy touts like yourself, and thereby keep the authorities from investigating them all the time. If in the process they have to stop allowing legal naked shorting, then it just has to be done. Both the article you posted and this one back this up, it's not the shorts causing problems for the brokers, it's unscrupulous people like you that bring the heat down on them. CMB

To: Francois Goelo who wrote (1362)	10/18/1999 12:20:00 AM
From: Jeffrey L. Henken	Respond to of 1567

Francois, stop worrying about what the short sellers say. The memo was real. The SEC's desire to enforce these rules are real too. Can they do it? Well they will try... Here is an example of some of the confirmations that can be found that the memo actually was issued. I found this at the SEC site. Read the memo and you will see where they referred to one Vincent Napolitano: Message 11620512 Here is the document that shows the SEC will go after those using pump and dump schemes to their advantage but also helping to confirm that the memo was indeed real: sec.gov CIVIL INJUNCTIVE ACTION FILED AGAINST VINCENT NAPOLITANO, STOCKPLAYER.COM, INC., IRVING STITSKY, JORDAN SHAMAH, ROBERT KESSLER AND FIFTEEN RELIEF DEFENDANTS A complaint has been filed seeking permanent injunctions, disgorgement, civil penalties and other relief against Vincent Napolitano, Irving J. Stitsky, Jordan I. Shamah, Robert B. Kessler, StockPlayer.com, Inc. and fifteen corporate relief defendants. The complaint alleges the defendants engaged in a complex "pump and dump" scheme in which they (1) obtained large blocks of stock in certain microcap issuers; (2) disseminated buy recommendations through StockPlayer, an Internet newsletter published by StockPlayer.com and controlled by Napolitano; (3) manipulated the prices of those securities through the use of bid and ask quotations and by bidding for and purchasing those securities while engaged in distributions of the blocks of stock held by the defendants; and (4)sold out their shareholdings at profits of millions of dollars. The complaint also alleges Napolitano and StockPlayer.com disclosed only a portion of the compensation they received from issuers for publishing buy recommendations for their securities and alleges Napolitano engaged in "scalping" by selling stock at the same time StockPlayer was recommending to subscribers that they buy those securities.

To: Francois Goelo who wrote (1362)	10/18/1999 12:35:00 AM
From: Jeffrey L. Henken	Respond to of 1567

Here is an interesting letter written to the SEC on proposed rule changes and naked shorting by market makers: sec.gov I am writing in response to the proposed amendments to Rule 15c2-11. I am very much in favor of increased regulation to reduce fraud and manipulation in the trading of non-exchange and NASDAQ stocks. However, I don't believe the propsed regulation are the best method. I support the comments of thee National Quotation Bureau. I would further like to suggest increased regulation in the area of short trading. I beleive the markets makers should have to disclose their short positions as well as be precluded from participating in naked shorting. This is an area where there is rampant abuse in the markets which take the markets out of the economic rule of prices fluctuating based on supply and demand to one where it is artificially controled by the market makers. Thank you. John M. Dab

To: Francois Goelo who wrote (1362)	10/18/1999 12:37:00 AM
From: OLD JAKE JUSTUS	Respond to of 1567

This ought to help. Reposted from Bobz's: >>> LETTER TO SENATOR FRITZ HOLLINGS CONCERNING OTC:BULLETIN BOARD ALLEGED STOCK MANIPULATION jakejautus badassjake@hotmail.com This letter was sent to Senator Fritz Holling, D-SC and Congressman Jim Clyburn, D, 6th District, SC. I hope that if you agree that you will let your elected officials know. From: "JAKE JUSTUS" badassjake@hotmail.com Save Address Block Sender To: senator@hollings.senate.gov Save Addresses CC: badassjake@hotmail.com Save Addresses Subject: Fwd: OTC:BULLETIN BOARD STOCK Date: Sun, 17 Oct 1999 20:53:10 PDT TO: Senator Fritz Hollings From: Walter O. "Jake" Justus POB 69, 1520 Trappers Run Drive Wedgefield SC 29168 Phone: 803-494-9311 Fax: 803-494-3244 email: badassjake@hotmail.com Senator Hollings: There appears to be some serious problems in the NASDAQ, OTC:Bulletin Board stock trading field, here in the United States and abroad. In my humble opinion, the main problems are with the so called "Pumpers and Dumpers" and Insiders, the OTC-BB day traders and especially, with the Market Makers. Senator, the cards appear to be stacked against the Individual Investor, like myself and many others, who dabble in the OTC:BB field of stocks. The below post, from a board on the Internet, in my opinion, best describes the basic problems in bulletin board stocks, here and abroad. There probably are many problems that I am not aware of, but these appear to be overly common. Could you please look into these problems and make sure that the SEC Rules and Regulations are tilted a little more favorably toward the Individual Investor? IMO, the shorting of OTC:BB stocks should be made illegal. It should be a violation of Federal Law To Pump and then Dump, OTC:BB stocks, especially by Insider, Pump and Dumpers and any other manipulators. The market makers of OTC:BB stock should be put on notice that security laws will be strictly enforced. It should, IMHO be made a law that naked shorting/borrowed shorting of OTC:BB, stocks by anyone, including the market makers, in the USA, or abroad, be illegal. Those violating that law should be prosecuted to the fullest extent of the law. The SEC can probably change the rules to include this and the SEC should, then be required to enforce it. These proposed rules should be made and enforced universally, here and abroad. Note from below: >>>"Whether this ends so called "naked shorting" remains to be seen. Frankly, the incidents, of actual naked shorting, is much, much less than people think it is. Most of the cases referred to in the memos and press deal with instead illegal insider selling. Insiders and promoters in "pump and dump" schemes take big blocks of stocks up north and use Canadian brokers to dump them into the market. Naturally, this kind of massive selling depresses the market, which the insiders and promoters (the very people selling) are blaming on "naked shorters".>>> Posted verbatim from the Internet Silicon Investor Board and BOBz's: To: +Bill Evans (4436 ) From: +OLD JAKE JUSTUS Sunday, Oct 17 1999 2:36AM ET Reply # of 4445 O/T Reposted from BOBz's: Canadian Shorting....I posted a question about this in the public forum misc.invest.canada - here is the response I got. Seems like this is indeed true! Voyager voyager@ragingbull.com -----Original Message----- From: STaylr14 staylr14@aol.com Newsgroups: misc.invest.canada Date: Saturday, October 16, 1999 3:54 PM Subject: Re: Ending of Naked Canadian Shorting of OTC:BB stocks - Detail on the reports of such, inside this message. The memo and regulatory activity mentioned within it are believed to be genuine. There has been an enormous amount of media coverage within Canada on the subject over the last 4 months as US action has been made public. Actually this stuff is not new as the SEC and British Columbia Securities Commission, in conjunction with the IDA and Vancouver Stock Exchange as well as several US State regulators have been working together for several years to combat illegal Canadian brokerage activity in the United States. The investigations run from stock manipulation of US OTC:BB stocks to Canadian brokers with US clients conducting illegal US business by not being registered in the US. In fact, the SEC and BCSC have even been engaged in a LONG court case with one Vancouver brokerage firm over trading records of their US clients. That case is still winding its way through the Canadian courts. Several Vancouver brokerages have recently stated publicly that they are ending or reducing not only their US OTC BB activity but also withdrawing from taking US clients, which have been done illegally. They are finally taking steps to comply with US law, which in many cases is long overdue, IMO. As the SEC and Canadian authorities step up their investigations, I think you will see much more of this kind of action. Whether this ends so called "naked shorting" remains to be seen. Frankly, the incidents of actual naked shorting is much, much less than people think it is. Most of the cases referred to in the memos and press deal with instead illegal insider selling. Insiders and promoters in "pump and dump" schemes take big blocks of stocks up north and use Canadian brokers to dump them into the market. Naturally, this kind of massive selling depresses the market, which the insiders and promoters (the very people selling) are blaming on "naked shorters". -ST Publisher of a free twice weekly online Canadian Stock Market newsletter at: www.taylorstock.com/ End of Message////woj/// [ This message was edited on Mon Oct 18 at 0:10am by the author ] <<<

To: Francois Goelo who wrote (1362)	10/18/1999 12:40:00 AM
From: Jeffrey L. Henken	Read Replies (1) \| Respond to of 1567

Additional information proving that SEC is making every attempt to level the playing field: sec.gov The same "uptick" rules should apply to all stocks (OTC Bulletin Board, Nasdaq SmallCap) as a requirement to make a short sale. Broker-dealers should be strictly required to meet the same coverage requirements for naked shorts as applied to customers and a 100% haircut on such shorts should be strictly enforced against violators. A system should be implemented to determine accurately through reporting requirements the number of shares that have been shorted and vigorously enforce the rule. The shorting of all stock within ten business days after effectiveness of an initial public offering should be prohibited.