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Biotech / Medical : T/FIF, a New Plateau -- Ignore unavailable to you. Want to Upgrade?

To: scaram(o)uche who wrote (1194)	5/22/2002 4:17:49 PM
From: RCMac	Respond to of 2243

What would prevent someone from delivering counterfeit securities to cover a short? At least the fear of getting caught, in particular the fear of: (1) criminal liability (both Federal and state) under theories of counterfeiting, fraud, securities law violations, etc.; (2) civil liability for damages (suffered by the others parties to the transaction -- counterparty, broker -- and SEC injunction; (3) SEC investigation and barring from SEC registration (if that's relevant and they actually care) and from trading privileges and association with SEC-registered entities. Assuming some substantial amount was at issue or the conduct was particularly egregious in some other way (or the perpetrators of the fraud were good prosecutorial targets for other reasons), SEC investigation and Federal criminal prosecution might well be real issues. As to how soon they might get caught, it would probably take a pretty convincing counterfeit certificate to get past the first line of screening (the "cashier"-sort at the delivery house), since there are at least some cautions about counterfeit certificates and at least some alertness. If the certificates got past that point, they would be caught eventually, I think within days or at least within weeks, when the transfer agent compared the certificate with its records of issued certificates. The risks of being caught and pursued are thus probably pretty high. And probably not a very hard crime for the prosecutors to prove up. I can't comment more as I don't know more about the scheme you're concerned about. Cheers, --RCM