Naked Short Selling

Here's an email I got this morning:

HERBALIFE LTD COM USD SHS (HLF) Hear its going to $10 because of FRAUD,,,


Nice story Down $2 already,, lets see what happens

That was at 10:01, and maybe I was next to last to get it.

Then, this hit my scanner about 11:

http://www.sequence-inc.com/fraudfiles/2008/04/11/herbalife-red-flags-for-fraud-issue/

But FINRA has warned that anyone spreading rumors about Financials is going to hear from them.

So, it's ok for everybody else, but don't touch our own guys. And so it goes. And so it goes.

Neither I, nor anyone I know, traded on the above information.
 
Check out the put vol, I believe Tues and Wednesday, July 12.5 and 17.5's. Stock is up big those days, and tanks Thursday. NOW, Today..
April 11, 2008 -- Overstock.com Inc., the Internet seller of discounted brand-name goods, and Chief Executive Officer Patrick Byrne OVERSTOCK FACES SUIT
Bloomberg
April 11, 2008 -- Overstock.com Inc., the Internet seller of discounted brand-name goods, and Chief Executive Officer Patrick Byrne will be sued for libel by Gradient Analytics Inc., the research firm said.
Gradient was defamed by Overstock.com and Byrne in retaliation for research that criticized the retailer's financial performance, Gradient said in an e-mailed statement.

Gradient will file the complaint when it gets final permission to do so from a California state court judge in San Francisco, spokeswoman Karen Hinton said yesterday in a voicemail message. Earlier yesterday, Hinton said the suit had been filed.

"These bullies have spent two and a half years hiding in the locker room to avoid having to back up their words," Byrne said yesterday in an e-mail. "Now that they've been dragged by their heels kicking and screaming into the ring, they bounce up and begin pounding their chests."

Overstock.com fell $1.31, or 9.3 percent, to close at $12.81.

So, we're gonna maybe, well, we were, and we set up for it, but our PR person thought we'd already done it, but we didn't and didn't stop her and now we have these puts and the MM is using his exemption to short a stock already heavily and illegally shorted and........................

And you wonder why Wall St. is on its ass???????? How do you get Press for a non event? I know. Do you????
 
The PIPEwire

SEC Inspector General to Audit Naked Short Selling Investigations

Posted May 08, 2008 3:15PM PST

The Office of the Inspector General of the Securities and Exchange Commission is going forward with an audit of how the commission has investigated allegations of naked short selling, according to a person familiar with the situation.

The audit, which is starting this week, will look into the process the SEC's Division of Enforcement uses in responding to naked short selling complaints and referrals.

Investor advocates have argued that naked short selling, where short sellers don't borrow or deliver the stock that they've sold, has been damaging to small cap companies.

The inspector general's office, which conducts internal investigations of the SEC, will be coordinating with the Government Accountability Office. GAO officials said in April that they would conduct their own probe of the SEC's response to the issue of stock-delivery failures. The GAO investigates government agencies on behalf of Congress.
 
I had mentioned before that the Authorities, the REAL authorities, were on the money trail. Of course, I was immediately whipped and fucked by the resident nay sayers. However, if you want to see what happens to naked short selling profits, Google "Dr. Dr. Herbert Batliner", then, go here:

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/08/15/bcnliecht215.xml

He's a principal of the major bank there, and a long time client of UBS. Now, many have asked me about , "well, name one company that wasn't a piece of shit........ blah blah blah" Here's a company that's been gutted by naked short selling. They are making it. Scroll all the way to the bottom, and I will link Batliner to Sedona, in a bad way.

SEDONA Announces Second Quarter Operating Results
Friday August 15, 9:00 am ET
Second Quarter Revenues increased 54%


KING OF PRUSSIA, Pa., Aug. 15 /PRNewswire-FirstCall/ -- SEDONA® Corporation (OTC Bulletin Board: SDNA - News; www.sedonacorp.com), a leading provider of Customer and Member Relationship Management (CRM/MRM) solutions for the financial services market, today announced operating results for the three and six month periods ended June 30, 2008.
ADVERTISEMENT


Second quarter revenues increased 54% to $470,000 compared to $305,000 in the comparable quarter a year ago. Product license revenue increased 146% to $263,000 compared to $107,000 reported in the quarter ended June 30, 2007. Services revenue increased 5% to $207,000 compared to $198,000 in the quarter ended June 30, 2007.

For the six month period ended June 30, 2008, total revenues increased 23% to $774,000 compared to $630,000 in the same period of 2007. Product license revenue increased 56% to $348,000 for the six months ended June 30, 2008 compared to $223,000 reported in the same period of 2007. Services revenue increased 5% to $426,000 compared to $407,000 for the six month period ended June 30, 2008. The increases in product license and services revenues are attributable to the Company's expanding customer base.

In addition, as of June 30, 2008, accounts receivable and deferred revenue from Software as a Service (SaaS) sales increased 35% to $676,000 compared to $503,000 reported as of June 30, 2007.

Gross profit reported for the second quarter was $431,000, or 92% of revenues, compared to $222,000, or 73% of revenues, in the second quarter 2007. For the six month period, gross profit was $687,000, or 89% of revenues, compared to $440,000, or 70% of revenues, a year ago. The increase is primarily due to the stability of the current version of SEDONA's CRM/MRM application as well as efficiencies in delivering services which resulted in lower cost of sales.

Operating expenses, excluding litigation costs, decreased 4% to $562,000 in the second quarter of 2008 compared to $587,000 in the quarter ended June 30, 2007. Litigation expenses increased from $95,000 to $279,000. For the six month period ending June 30, 2008, operating expenses, excluding litigation costs, decreased 2% to $1,213,000, compared to $1,234,000 reported in the same period in 2007.

For the three month period ended June 30, 2008, SEDONA reported a net loss, including litigation expenses, of $572,000, or ($0.01) per share, compared to a loss of $605,000, or ($0.01) per share in the quarter ended June 30, 2007. For the six month period ended June 30, 2008, SEDONA reported a net loss, including litigation expenses and a loss on extinguishment of debt, of $1,563,000 or ($0.02) per share, compared to $1,332,000 or ($0.01) per share, in the same quarter a year ago.

Recent announcements include:

-- Norristown Bell Credit Union selected SEDONA as its MRM technology and services provider

-- New extension to the partnership with CU ink, Inc. to deliver marketing services to Intarsia customers

-- Washington Trust Bank selected SEDONA's technology and services for its customer information management system. Washington Trust is the largest private commercial bank in the Northwest, with $3.7 billion in assets

-- Ascension Credit Union, based in Louisiana, selected SEDONA as its MRM technology and services provider

-- Mid-Illini Credit Union selected SEDONA MRM technology and services. Mid-Illini serves over 7,000 members and is based in Bloomington, Illinois, and

-- NE PA Community Federal Credit Union joined others by selecting SEDONA also for their MRM solution.

For more details concerning SEDONA's operating results, please consult the Company's form 10-Q filed with the Securities and Exchange Commission on August 14, 2008.

About SEDONA Corporation

SEDONA® Corporation (OTCBB: SDNA - News) provides multi-vertical Customer/Member Relationship Management (CRM/MRM) solutions and services specifically tailored to the financial services market. SEDONA's CRM/MRM solution, Intarsia®, is designed and priced to support and meet the needs of the multiple lines of business of banks and credit unions. Intarsia provides the entire financial services institution with a complete and accurate view of their customers' and prospects' relationships and interactions. By utilizing SEDONA's CRM/MRM solution and services, SEDONA's clients effectively identify, acquire, foster, and retain loyal, profitable customers. For additional information, visit the SEDONA web site at www.sedonacorp.com or call 1-800-815-3307.

Forward-Looking Statements

Statements made in this news release that relate to future plans, events or performances are forward-looking statements. Any statement containing words such as "believes," "anticipates," "plans," or "expects," and other statements which are not historical facts contained in this release are forward-looking, and these statements involve risks and uncertainties and are based on current expectations. Consequently, actual results could differ materially from the expectations expressed in these forward-looking statements.


SEDONA® and Intarsia® are registered trademarks of SEDONA Corporation.
All other trade names are the property of their respective owners.
This press release and prior releases are available on the
SEDONA Corporation web site at www.sedonacorp.com.




--------------------------------------------------------------------------------
Source: SEDONA Corporation




Reference the growth in the revenues, and list of clients they are signing. The problem is, they've been starved of capital they need to grow faster. I reference this because in the SEC Civil matter, they site Rhino and Badian. These animals were clients of REFCO, and Batliner had a piece of Rhino. This all should be coming together for you. BTW, Sedona is the only company that survived the Badian attacks. Badian won all the other battles. How many would have done something special? I know of several cancer cure companies where the companies have success, but the stock can't move. It's an amazing story. The DOJ has an investigation going in this matter also. Disclosure. I do own Sedona stock.
 
Here's one for you. We'll take the previous example. Software contracts are delivered over periods of time. In Sedona's case, 60 months. In order to properly communicate to its shareholders what was happening, they wanted to show the revenue of the 60 months. The authorities said, "no". You recognize your revenues as the money is received. Of course, w/o an analyst, no one sees the future stream of revenues. So be it. It's the way it is.

Broker A 'sells' 100,000 shares of xyz to Broker B and their customer. But they 'fail to deliver'. They charge a commission- they take the customers money. They recognize the revenue on their consolidated balance sheet. But they delivered no service. All they do, is put an iou in your account, backed by the firm. And with the firms' recent rating, I don't think anyone would knowingly take such a risk.

Anyway, if example 'A" is good for the gander, how are Broker dealers taking credit for trades that really don't happen, and charge for it? Besides the fraud, aren't they breaking every accounting law in the book? Besides the recognition of revenue, aren't they carrying all these liablilites illegally off the balance sheet? ACtually, their filings are fraudulent, as they do not properly reflect the liability.

I would suggest you go to Barry Ritholtz' blog this weekend, and look at the level 3 assets vs. equity these firms carry. It is chilling. And it's only part of the story.
 
I don't believe there is an accounting issue. The trades are reconciled electronically in dollars and cents, naked or otherwise. ftd may be (I don't know) reconciled against paper issued stock certs, never the two shall meet.
 
I believe I have pointed out from time to time that Dan Loeb, Mr pink , "4", was a member of the Elgindy web site. Notice, he comes back with "oh woe is the short seller" bullshit. It is with glee that I present the following:

Third Point Reports Losses, Investigation
19 Aug 2008
Imogen Rose-Smith
SEC probing dealings with other hedge funds, CEO Loeb tells investors.
Daniel Loeb, CEO of the $5.6 billion New York–based activist hedge fund firm Third Point, has revealed in a letter to investors that his funds had suffered from a sharp reversal in energy and financial stocks during the first three full weeks of July, sustaining losses “in the high single digits” that effectively erased all of its gains for the quarter. (The Third Point Partners Fund was up 8 percent for the second quarter and 3.6 percent for the year before its July troubles.)

In addition, Loeb disclosed in his July 25 second-quarter investor letter, a copy of which has been obtained by Alpha, that the Securities and Exchange Commission has begun a formal investigation into Third Point’s communications with portfolio managers at other hedge funds.

“As you may recall, the SEC conducted an audit of Third Point last year after we registered as an investment adviser,” writes Loeb, who is known for the caustic letters he pens to corporate executives. “During the course of the audit, the examination staff noted that we regularly communicate with portfolio managers at other hedge funds about investment and trading ideas. The SEC later informed us that it had commenced a formal investigation of Third Point primarily relating to these types of communications.”

Loeb argues that such conversations help the hedge fund firm refine its thinking and test out ideas and is, therefore, in the best interest of its investors. He adds that Third Point is well within its rights to converse with other managers: “Our outside counsel has examined this matter thoroughly and assured us that our position is consistent with the securities laws and that we have not violated any law in connection with these communications.”

Still, Third Point’s revelation comes at a time of significant market volatility, when the voices calling for greater scrutiny into the activities of hedge funds are getting louder. In June, Judge Lewis Kaplan of U.S. District Court for the Southern District of New York took London-based hedge fund the Children’s Investment Fund (UK) to task in his summation of a case brought against that firm by railroad company CSX Corp. In his ruling, which favored TCI but is currently on appeal, Judge Kaplan made a point of criticizing the way in which TCI interacted with other hedge funds and accused it of violating the Williams Act, which forbids investors acting individually or together to hold more than 5 percent of a company’s shares without publicly disclosing the position. He suggested that the SEC or the Department of Justice look into TCI’s behavior.

The SEC, for its part, has been busy. The agency recently subpoenaed more than 50 hedge fund managers in a probe for information about their trading activity this year in the shares of investment banks Lehman Brothers and Bear Stearns Cos. It also instituted temporary emergency actions in mid-July to curb short-selling in 19 financial services firms, including troubled mortgage companies Fannie Mae and Freddie Mac.

“A chorus of ‘blame the shorts’ is generally an excellent indicator of significant underlying problems,” wrote Loeb, who was far from the only hedge fund manager to take it on the chin in July when the price of oil plummeted and financial stocks rebounded. “As a friend said to me, ‘Capitalism without bankruptcy is like Christianity without Hell.’”
 
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