By: scruffy_too
17 Jan 2009, 09:45 PM EST
Msg. 799220 of 799504
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Gus,
Something to chew on perhaps?
www.sec.gov/rules/proposed/34-49804.htm The interesting stuff is in section 2 - Need for new rule, but also the June 2004 date... Interesting to see what as happening in CMKX Land at that time and what occurred in the months that followed. The Rule was put in place in March 2005, apparently. I think they call it context. :-)
Pete
By: gusjarvis
18 Jan 2009, 12:31 AM EST
Msg. 799245 of 799504
(This msg. is a reply to 799220 by scruffy_too.)
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hey scruffy it is good to hear from you and
dam that was some interesting chit buddy. Too bad we still have to be lied to and bullchitted and kept busy for now.
this part particularly at first glance was interesting also, sounds like what cmkx did and others who bought out their floats, in other words the team of companies who f'd the federal reserve:
II. NEED FOR THE PROPOSED RULE
A small but growing number of issuers whose securities are registered under Section 12 or are reporting under Section 15(d) of the Exchange Act41 recently have restricted, or indicated their intention to restrict, ownership of their securities by prohibiting their transfer agents from acknowledging ownership of shares registered in the name of DTC or by prohibiting transfer of their securities to DTC or in some cases to any securities intermediary.42 Most, if not all, of the issuers restricting ownership of their securities have also required that the shares be represented in certificated form.43 In several cases, the issuer has required the broker-dealer to disclose the name of the ultimate beneficial owner before reregistering any securities held by the broker-dealer either in the name of the broker-dealer or in the name of DTC. 44 Some brokers refused because they believed disclosure of the customer’s name would violate federal securities laws45 or contractual obligations to the customer. Other broker-dealers could not disclose the name of the ultimate beneficial owner because they knew only the identity of their customer and not necessarily for whom their customer was holding the securities.
Issuers imposing these restrictions, sometimes referred to as “custody-only trading,” frequently state that they are imposing ownership or transfer restrictions on their securities to protect their shareholders and their share price from “naked” short selling.46 These issuers believe that requiring all securities to be in certificated form and precluding ownership by certain securities intermediaries forces broker-dealers to deliver certificates on each transaction, thereby eliminating the ability of naked short sellers to maintain a naked short sale position.47
A number of issuers imposing ownership or transfer restrictions sought to withdraw from DTC all securities issued by them and indicated that they would not allow their securities to be reregistered in the name of DTC.48 In June 2003, the Commission approved a DTC rule change clarifying that DTC’s rules and procedures provide only for participants (i.e., broker-dealers and banks) to submit withdrawal instructions for securities deposited at DTC and do not require DTC to comply with withdrawal requests from issuers.49
In response, a number of issuers indicated that they had adopted or would adopt restrictions, assertedly pursuant to state corporation laws, to prohibit ownership of their securities by a depository, securities intermediaries, or both.50 Issuers’ actions to implement the restrictions caused numerous clearance and settlement problems. Some of these issuers refused to recognize positions that had been registered in the name of DTC’s nominee or in the name of broker-dealers before the adoption of the restriction and refused to transfer (or allow their transfer agent to transfer) stock to the name of any entity or person that the issuer believed was not the ultimate beneficial owner.51 Where issuers refused to recognize ownership positions registered in the name of securities intermediaries, the broker-dealers and banks were forced individually to negotiate a solution directly with the issuer.
In order to compel securities intermediaries to register stock only in the names of the ultimate beneficial owners, some issuers initiated corporate actions or “reorganizations.” These corporate actions or reorganizations, such as stock dividends, exchanges, reverse splits, or name changes, were intended to force the intermediaries to either comply with the issuers’ instructions to deliver securities to the issuer or its agent for exchange and reregistration into the name of the ultimate beneficial owner or exclude their customers from participating in a corporate action or dividend.52 In situations where broker-dealers refused to comply with the issuer demands to disclose the name of customers so that new restricted shares may be issued, the new securities remain unissued.
Where securities intermediaries are precluded from having securities registered in their names, the securities intermediaries’ ability to hold and move securities is severely limited. As a result, trading and clearance and settlement efficiency suffers, and costs and risks increase. This consequence of issuer restrictions is not compatible with the congressional objective that trades in the securities of publicly traded companies should be settled through the national system for clearance and settlement and benefit from its efficiencies and risk reductions and is a significant step backwards in our progress to develop the national system. Furthermore, forced certification of securities is inconsistent with the industry’s goals of streamlining processing of securities transactions.53
These types of restrictions have also caused investors increased costs and delays. By forcing securities intermediaries to submit securities as part of an issuer’s recapitalization, the transfer agent must transfer the securities by canceling the certificate registered in the name of the securities intermediary and re-register a new certificate in the name of the beneficial owner. Transfer agent registration fees, which may range from $10.00 to $75.00 per transfer, and costs for secure delivery of securities certificates, can be more than the market value of the securities being processed.54 In some cases, the broker-dealers assume these costs but in many cases the cost is passed along to investors. Broker-dealers that did reregister securities received numerous complaints from investors about the fees, particularly where the investors had not issued instructions to reregister the securities. In addition, broker-dealers had to deliver the securities certificates to an issuer’s transfer agent and the transfer agent similarly had to deliver the newly registered certificates. As a result, there were significant costs and delays in obtaining certificates, which could ultimately impede the customers’ ability to sell or otherwise negotiate the security in the marketplace.
The Commission understands that some issuers view this mechanism as a means of deterring manipulative naked short selling.55 These issuers believe that by requiring securities be processed through the national system for clearance and settlement, the securities are subject to manipulative naked short selling, which, they argue, can result in issuers and investors suffering losses due to the diminution in the market value or adverse effects on ownership (e.g., dilution, decrease in market value, or loss of voting rights).56 The Commission has recently published for comment proposed rules directly relating to issues raised by short selling.57 The Commission does not believe that naked short selling concerns should or can be addressed by issuers attempting to control the ownership or transferability of their securities that trade in the public market. Restrictions on securities can often make the stock less liquid, causing reduction in the value of the securities, and interfere with efficient processing. Accordingly, we are proposing a rule that would prohibit registered transfer agents from transferring any equity security registered under Section 12 or any equity security that subjects an issuer to reporting under Section 15(d), other than equity securities issued by partnerships, if such security is subject to any restriction or prohibition on transfer to or from a securities intermediary. The objective of the proposed rule is to prohibit registered transfer agents from effecting transfers in securities of public companies that have restricted their stock in a manner that prevents trades in these securities from being processed through the national clearance and settlement system.
By: scruffy_too
18 Jan 2009, 12:57 PM EST
Msg. 799405 of 799504
(This msg. is a reply to 799245 by gusjarvis.)
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Gus,
What I found most interesting was that it was released almost to the day that Roger Glenn came onboard CMKX and that he almost immediately put most of these measures into action. It's almost like he was handed a checklist, LOL!
Cheers!
Pete
By: gusjarvis
18 Jan 2009, 02:03 PM EST
Msg. 799437 of 799504
(This msg. is a reply to 799405 by scruffy_too.)
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scruffy and remember leslie was pizzed at andy
and phoned roger to give him chit about what came out on the boards that wasn't suppose to at the time, probably screwing with their operation.
then the silver state bank fraud records were subpoenaed when roger was there and he just keep working and pumping the stock after that. Bob and bill and the team also pumped the stock after the records were subpoenaed by the doj and fbi and sec.
a month after those records were turned over the head of the whole fraud division in that state, nevada, drove our cmkx truck and after that bob came on and they bought the 800 000 dollar got cmkx sign for nascar, pretty ballsy for a fraud.
hey and ps, all this talk about our assets, just look at the pr's from roger and bob maheu, and remember we didn't know the silver state bank records were turned over back then, we just found out about it from mark awhile back. It puts thins into perspective to know that while we had amazing assets and money and all those amazing pr's the task force and the team, especially bill frizzell and bob maheu and don and roger, all knew exactly what went on here, exaclty. All those assets in those pr's are ours or they are going to get their azzes handed to them. They gave us too much info to not pay us, they gave us all the evidence to fry themselves so they obviously are not going to let us use it against them.
cheers bro and lets hope we party on the island this summer!