Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Pastimes : Investment Chat Board Lawsuits -- Ignore unavailable to you. Want to Upgrade?

To: kknightmcc who wrote (7176)	2/4/2005 4:52:22 PM
From: Bill Ulrich	Respond to of 12465

yeah, I gave Food Network an exclusive for my Fried Rhubarb & Cutworm Dumplings, too. They still have an exclusive, but you know, there are several things we can't really get into on this thread because Food Network has an exclusive. I've honoured that for a year. Maybe I should give the exclusive to Dateline instead? I'll bet they're just salivating at the chance to jump on the story. "Dateline still has an exclusive, uh, there’s several things, you know, on this show that we really can’t get into because Dateline has an exclusive. We’ve honored that for a year."

To: kknightmcc who wrote (7176)	2/4/2005 11:59:32 PM
From: rrufff	Respond to of 12465

Hopefully Dateline will go with the story. As there may not be a catch name like Martha Stewart, they may be more concerned about ratings than outing these scammers. Here's something that may help. -------------------------------------------------------------------------------- HoustonChronicle.com -- houstonchronicle.com \| Section: Business Feb. 4, 2005, 3:34PM Probe snags three hedge fund managers Reuters News Service NEW YORK - U.S. and Canadian regulators have charged three hedge fund managers with insider stock trading violations as part of a broad investigation launched last spring into a string of alleged short-selling abuses. ADVERTISEMENT CompuDyne Corp. said this week it recently learned that former investor Hilary Shane faces NASD charges of violating securities laws in a financing deal the security company did in October 2001. Shane, a former hedge fund manager at First New York Securities, LLC, made $1.1 million from inside information of the deal, according to an NASD complaint filed in late December. Michael Finkelstein and Elizabeth Leonard, of Toronto-based Stonestreet LP, face similar charges by the Investment Dealers Association, a Canadian regulatory agency. The charges come less than a year after the U.S. Securities and Exchange Commission and the NASD pursued allegations of hedge funds profiting from inside knowledge of private investments in public equity, a transaction known on Wall Street as a PIPE. PIPEs help cash-strapped companies raise money quickly by selling discount-priced shares to a group of investors. The stock of a company conducting a PIPE usually falls in the short-term because the transaction floods the market with additional shares. Regulators are investigating whether individuals who helped finance a PIPE profited from selling short the company's shares before the deal closed, knowing its stock was about to fall. Shane, who left First New York in 2002, is accused of doing exactly that. Short sellers borrow shares of a company and then sell them in anticipation of a decline. They profit when the stock falls since they can buy back the shares at a lower price and pocket the difference. In September 2001, a representative at investment bank Friedman, Billings, Ramsey Group Inc. contacted Shane about doing a PIPE with CompuDyne, according to the NASD complaint. The complaint says Shane made false representations about her investment intent, obtained the right to acquire 475,000 shares of CompuDyne and then engaged in unlawful insider trading by selling the company's stock short while in possession of material, nonpublic information. First New York has not been charged in relation to the case. Shane could not be reached for comment. The complaint does not list charges against FBR, but FBR said on Nov. 9, 2004 that the SEC and the NASD were investigating the bank's role as a placement agent for an unspecified PIPE transaction in 2001. An FBR spokesman declined to comment further. Finkelstein and Leonard face similar charges stemming from a PIPE involving Novatel Wireless Inc. in 2001 and another with Trikon Technologies Inc. a year later. Stonestreet LP's Web site lists Finkelstein and Leonard as officers of the investment firm. The IDA complaint says that Stonestreet maintains a non-client account at Canaccord Capital Corp.'s Toronto office that operates as a hedge fund, which Finkelstein and Leonard co-manage. The fund would hedge against its anticipated investment in a PIPE by "shorting the issuer's underlying stock," according to the complaint that was filed on Jan. 7. Reached by telephone at Stonestreet, Finkelstein said he would not comment. Leonard could not be reached. Last week drugmaker Nuvelo Inc. said the SEC had contacted it about a private transaction the company did in 2002. "We're concerned about instances in which hedge funds executed profitable short sales in an issuer's underlying equity after learning about a pending PIPE transaction," said SEC spokesman John Heine. "Our review is continuing."

To: kknightmcc who wrote (7176)	2/5/2005 1:19:28 AM
From: Jeffrey S. Mitchell	Read Replies (1) \| Respond to of 12465

According to what you posted, Dateline is essentially going to declare the entire US system of trading as corrupt. And when you think about it, that may be true. Does death spiral financing strangle companies? Yes. Is the mob involved in the market. Yes. Are there loads of offshore companies manipulating stocks? Yes. Have analysts been guilty of pumping stocks they own? Yes. Has the mutual fund industry been sticking people with ridiculous fees? Yes. Do CEOs use company funds as their own private banks? Yes. If you want to toss in another yes under naked shorting, go ahead. The point is that if Dateline does do a fair and balanced piece that naked shorting will be little more than a footnote compared to the money lost by everything else. - Jeff