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The Actual Aguirre Letters
- Thread starter wilburbear
- Start date
Quote from wilburbear:
How can you be certain that this gentleman was investigated? And, can you say what you mean by flipping?
Thx,
W
Real easy. They told him. He approaches all of them at least three times a week with emails, and dozens of phone calls. Last week, he told them all how they ignored Patrick Byrne's plea for help, and now, they are libel and very jailable. That one killed me. You know, of course, two SEC Commissioners resigned.
Several very, very interesting points contained in this fine article. How did that uptick rule get repealed again???
As an aside - last year, Cramer and Greenberg were subpoenaed by the San Francisco office of the SEC. He threw the subpoena on the floor - I emailed that to an SEC enforcement attorney who said, "send me the clip immediately." Obvously, it was a no no. Later, the subpoenas of both "reporters" were withdrawn. I do believe, if one were to read the Aguirre testimony, those subpoenas were ver likely issued for cause, and the subpoenas were approved in SF. Later, in a very, very short period of time, the Gradiant Rocker case was concluded saying, "nothing found". Odd, since in California, the Appellatate Court ruled Overstock had cause , and the AG in Calif issued an Americus Brief (friend of the court) in favor of Overstock. This could explain Crames, I call him Crames, strange benevolent behavior.
This is serious stuff, and explains much of the confusion in the markets today. A perp walk is in order.
Senate probes SEC for stonewalling
By Dan Jamieson
August 20, 2007
IRVINE, Calif. - After examining an aborted insider-trading investigation
involving Pequot Capital Management Inc. and Morgan Stanley chief executive
John Mack, Senate investigators have concluded that SEC enforcers are
concerned about being undermined by their supervisors.
Top officials at the Securities and Exchange Commission may be swayed by
influential defense lawyers, according to a Senate committee report released
this month.
The joint investigation by the Senate Judiciary and Finance committees was
sparked by Gary Aguirre, an SEC investigator turned whistle-blower. The
former enforcer claimed that an insider-trading investigation of New
York-based Pequot and Mr. Mack was scuttled in 2005 after enforcement
officials learned that Mr. Mack was being considered for the top spot at
Morgan Stanley.
Mr. Mack was hired by the New York-based wirehouse in June 2005. The report
affirmed Mr. Aguirre's claims that high-powered lawyers hired by Pequot and
Morgan Stanley had access to top SEC enforcement officials, who then decided
not to subpoena Mr. Mack. That decision was made without consulting Mr.
Aguirre and other investigators, according to the report.
Senate investigators found no evidence that Mr. Mack himself prevented or
delayed his testimony.
Mr. Aguirre theorized that Mr. Mack may have tipped his friend, Pequot
founder Arthur Samberg, about Stamford, Conn.-based General Electric Capital
Corp.'s pending acquisition of Heller Financial Inc. of Chicago in 2001.
Mr. Aguirre thought Mr. Mack may have heard something from officials of
Zurich-based Credit Suisse Group during a trip to Switzerland in late June
2001. New York-based Credit Suisse First Boston was working on the deal.
Within a month, Mr. Mack was hired as chief executive of CSFB.
After returning, Mr. Mack spoke with Mr. Samberg, and within days - and at
Mr. Samberg's direction - Pequot began purchasing Heller stock and shorting
that of Fairfield, Conn.-based General Electric Co., the report said.
The Heller deal was announced a month later. Pequot closed out its $80
million investment with an $18 million profit.
The Pequot case was once seen as so promising within the SEC that Mr.
Aguirre and other staff members in June 2005 briefed the FBI and the U.S.
attorney for the Southern District of New York about the matter.
SEC enforcement officials fired Mr. Aguirre in September 2005 after he
complained about not being able to depose Mr. Mack.
The SEC dropped the case in November 2006 after questioning Mr. Mack that
summer.
Mr. Mack told the SEC he never got a tip about Heller.
In a statement, SEC Chairman Christopher Cox said the SEC would follow up on
the report's recommendations. One recommendation was to protect more
effectively the integrity of investigations and protect employees.
Mr. Aguirre said SEC employees are still at risk for retaliation.
Mr. Cox "cannot leave their careers in the hands of the current
[enforcement] director," Linda Thomsen, he said.
Spokesmen for Pequot and Morgan Stanley declined to comment.
Senate investigators said there is "a perception within the SEC ... that
investigations involving prominent individuals can be slowed or halted by
contacts from outsiders with direct access to the most senior SEC
officials."
Being undermined by superiors "is a recurring problem here," an SEC
investigator wrote in an e-mail uncovered by Senate investigators.
Like Mr. Aguirre, this investigator suffered retaliation after complaining
about suspected interference in another investigation, the report said.
"The report confirms the existence of an elite cadre of securities lawyers
able to stop an SEC investigation in its tracks," Mr. Aguirre said.
"When [officials leave] the SEC for their $2-million-a-year job in private
practice ... it's their turn to harvest favors."
BloombergJohn Mack: Why was insider-trading probe into his activities
scuttled? Mr. Aguirre added that many of his colleagues at the SEC are "very
committed and talented ... But those who understand the favors game are more
likely to reach the highest levels" of the agency.
The Senate report also showed that SEC enforcers are outgunned.
When a lawyer at Fried Frank Harris Shriver & Jacobson LLP of New York who
was defending Pequot refused to produce requested e-mails, SEC lawyers gave
serious thought to building a disciplinary case against the law firm.
But an unidentified SEC staff member quoted in the report doubts the
agency's resolve, saying: "I have seen these [SEC enforcement] lawyers get
all huffy before. They are empty suits. When push comes to shove, no one in
the SEC is going to take on [Fried Frank] or any other major player - not
going to happen."
At one point, Fried Frank had 55 lawyers on the case, according to an SEC
e-mail uncovered by Senate investigators.
Little help
In contrast, records show that Mr. Aguirre was struggling to handle the case
with minimal administrative help.
Jonathan Gasthalter, a spokesman for Fried Frank, declined to comment.
Mr. Aguirre told Senators that the SEC had no problem going after small
targets. He contrasted the failure to pursue the Pequot investigation with a
similar case involving a former vice president of finance at GE Capital,
Anthony Chrysikos, and Mr. Chrysikos' accomplice, Michael Martello.
The men made $157,000 buying Heller call options before the GE buyout. The
SEC brought insider- trading charges against them in March 2002, and both
men were sentenced to prison that year.
Pequot's trades had been referred to the SEC by the New York Stock Exchange
in January 2002, but nothing happened with the case until Mr. Aguirre began
pursuing it in September 2004, the Senate report said.
BloombergGary Aguirre: He was fired from the SEC in September 2005
As an aside - last year, Cramer and Greenberg were subpoenaed by the San Francisco office of the SEC. He threw the subpoena on the floor - I emailed that to an SEC enforcement attorney who said, "send me the clip immediately." Obvously, it was a no no. Later, the subpoenas of both "reporters" were withdrawn. I do believe, if one were to read the Aguirre testimony, those subpoenas were ver likely issued for cause, and the subpoenas were approved in SF. Later, in a very, very short period of time, the Gradiant Rocker case was concluded saying, "nothing found". Odd, since in California, the Appellatate Court ruled Overstock had cause , and the AG in Calif issued an Americus Brief (friend of the court) in favor of Overstock. This could explain Crames, I call him Crames, strange benevolent behavior.
This is serious stuff, and explains much of the confusion in the markets today. A perp walk is in order.
Senate probes SEC for stonewalling
By Dan Jamieson
August 20, 2007
IRVINE, Calif. - After examining an aborted insider-trading investigation
involving Pequot Capital Management Inc. and Morgan Stanley chief executive
John Mack, Senate investigators have concluded that SEC enforcers are
concerned about being undermined by their supervisors.
Top officials at the Securities and Exchange Commission may be swayed by
influential defense lawyers, according to a Senate committee report released
this month.
The joint investigation by the Senate Judiciary and Finance committees was
sparked by Gary Aguirre, an SEC investigator turned whistle-blower. The
former enforcer claimed that an insider-trading investigation of New
York-based Pequot and Mr. Mack was scuttled in 2005 after enforcement
officials learned that Mr. Mack was being considered for the top spot at
Morgan Stanley.
Mr. Mack was hired by the New York-based wirehouse in June 2005. The report
affirmed Mr. Aguirre's claims that high-powered lawyers hired by Pequot and
Morgan Stanley had access to top SEC enforcement officials, who then decided
not to subpoena Mr. Mack. That decision was made without consulting Mr.
Aguirre and other investigators, according to the report.
Senate investigators found no evidence that Mr. Mack himself prevented or
delayed his testimony.
Mr. Aguirre theorized that Mr. Mack may have tipped his friend, Pequot
founder Arthur Samberg, about Stamford, Conn.-based General Electric Capital
Corp.'s pending acquisition of Heller Financial Inc. of Chicago in 2001.
Mr. Aguirre thought Mr. Mack may have heard something from officials of
Zurich-based Credit Suisse Group during a trip to Switzerland in late June
2001. New York-based Credit Suisse First Boston was working on the deal.
Within a month, Mr. Mack was hired as chief executive of CSFB.
After returning, Mr. Mack spoke with Mr. Samberg, and within days - and at
Mr. Samberg's direction - Pequot began purchasing Heller stock and shorting
that of Fairfield, Conn.-based General Electric Co., the report said.
The Heller deal was announced a month later. Pequot closed out its $80
million investment with an $18 million profit.
The Pequot case was once seen as so promising within the SEC that Mr.
Aguirre and other staff members in June 2005 briefed the FBI and the U.S.
attorney for the Southern District of New York about the matter.
SEC enforcement officials fired Mr. Aguirre in September 2005 after he
complained about not being able to depose Mr. Mack.
The SEC dropped the case in November 2006 after questioning Mr. Mack that
summer.
Mr. Mack told the SEC he never got a tip about Heller.
In a statement, SEC Chairman Christopher Cox said the SEC would follow up on
the report's recommendations. One recommendation was to protect more
effectively the integrity of investigations and protect employees.
Mr. Aguirre said SEC employees are still at risk for retaliation.
Mr. Cox "cannot leave their careers in the hands of the current
[enforcement] director," Linda Thomsen, he said.
Spokesmen for Pequot and Morgan Stanley declined to comment.
Senate investigators said there is "a perception within the SEC ... that
investigations involving prominent individuals can be slowed or halted by
contacts from outsiders with direct access to the most senior SEC
officials."
Being undermined by superiors "is a recurring problem here," an SEC
investigator wrote in an e-mail uncovered by Senate investigators.
Like Mr. Aguirre, this investigator suffered retaliation after complaining
about suspected interference in another investigation, the report said.
"The report confirms the existence of an elite cadre of securities lawyers
able to stop an SEC investigation in its tracks," Mr. Aguirre said.
"When [officials leave] the SEC for their $2-million-a-year job in private
practice ... it's their turn to harvest favors."
BloombergJohn Mack: Why was insider-trading probe into his activities
scuttled? Mr. Aguirre added that many of his colleagues at the SEC are "very
committed and talented ... But those who understand the favors game are more
likely to reach the highest levels" of the agency.
The Senate report also showed that SEC enforcers are outgunned.
When a lawyer at Fried Frank Harris Shriver & Jacobson LLP of New York who
was defending Pequot refused to produce requested e-mails, SEC lawyers gave
serious thought to building a disciplinary case against the law firm.
But an unidentified SEC staff member quoted in the report doubts the
agency's resolve, saying: "I have seen these [SEC enforcement] lawyers get
all huffy before. They are empty suits. When push comes to shove, no one in
the SEC is going to take on [Fried Frank] or any other major player - not
going to happen."
At one point, Fried Frank had 55 lawyers on the case, according to an SEC
e-mail uncovered by Senate investigators.
Little help
In contrast, records show that Mr. Aguirre was struggling to handle the case
with minimal administrative help.
Jonathan Gasthalter, a spokesman for Fried Frank, declined to comment.
Mr. Aguirre told Senators that the SEC had no problem going after small
targets. He contrasted the failure to pursue the Pequot investigation with a
similar case involving a former vice president of finance at GE Capital,
Anthony Chrysikos, and Mr. Chrysikos' accomplice, Michael Martello.
The men made $157,000 buying Heller call options before the GE buyout. The
SEC brought insider- trading charges against them in March 2002, and both
men were sentenced to prison that year.
Pequot's trades had been referred to the SEC by the New York Stock Exchange
in January 2002, but nothing happened with the case until Mr. Aguirre began
pursuing it in September 2004, the Senate report said.
BloombergGary Aguirre: He was fired from the SEC in September 2005