Data that makes you say hmmm – It's SHO and Tell Time – November 2,
2005
David Patch
On October 31, 2005, 3 days after an SEC Administrative Judge ruled
to deregister CMKX for violations of Exchange Act Rules 13a-1 and 13a-
13 by failing to file annual reports on Form 10-K or 10KSB over the
past few years, CMKX Owners Group Lawyers were granted settlement
failure (FTD) evidence under the Freedom of Information Act (FOIA)
pertaining to the execution of trades for CMKX. CMKX shareholders
forming this owners group believing they have been destroyed
financially by the elusive `naked short'.
Today, correlating this data to previous data gathered under the FOIA
by the PIPE's Report raises some serious questions about the data and
the overall integrity of the system.
Representing the shareholders of CMKX, Texas Attorney Bill Frizzell
requested specific information from the Securities and Exchange
Commission regarding the reported settlement failures in CMKX for the
Month of April 2005. The request was not seeking information that was
market member specific but instead merely aggregate numbers
represented in the system for each trade date for the month of April
2005. The SEC complied with such a request.
Likewise, the PIPE's Report also requested trade settlement data from
the SEC under a FOIA request this time requesting the aggregate fails
for the OTCBB, Pink Sheet, and AMEX listed securities during a time
frame that extended from April of 2004 through August 2005. The data
provided by the SEC was reported in the September Issue of the PIPE's
Report. The PIPE's Report concluding in their article that Regulation
SHO was not a total solution to settlement failures but merely a band-
aid.
So how do the two sets of data compare? Let's just say a picture is
worth a 1000 words.
According to the two sets of data, CMKX settlement failures
represented between 0% and 35% of the total aggregate fails in the
system for the quoting services of the OTCBB, Pink Sheets, and Amex.
Understand there are over 9000 publicly traded companies listed in
those combined trading services.
To compound matters, CMKX was not listed as a Regulation SHO
threshold security in April of 2005 due to a lack of up to date and
accurate filings. There were however over 150 AMEX, OTCBB, and Pink
Sheet Companies published on the threshold security list for fails in
excess of 0.5% of their total shares outstanding.
So if CMKX owns as much as 35% of the total aggregate fails
represented by 9000 companies, how many fails were represented by
those 150 listed on regulation SHO threshold securities lists
published?
The raw data first to aid in working through numbers.
Date
Total
CMKX
% CMKX
04/01/2005
400,031,086
5,000,000
1.25
04/04/2005
369,703,509
7,800,000
2.11
04/05/2005
362,249,413
17,800,000
4.91
04/06/2005
361,796,939
25,843,333
7.14
04/07/2005
399,642,964
56,129,333
14.04
04/08/2005
507,353,905
17,743,333
3.50
04/11/2005
558,800,282
44,743,333
8.01
04/12/2005
353,711,670
6,009,429
1.70
04/13/2005
356,304,547
1,000,000
0.28
04/14/2005
325,056,854
10,000
0.00
04/15/2005
411,684,565
2,700,000
0.66
04/18/2005
308,502,659
10,000
0.00
04/19/2005
401,693,162
84,800,000
21.11
04/20/2005
523,115,782
82,329,000
15.74
04/21/2005
462,461,041
125,329,000
27.10
04/22/2005
523,013,137
186,270,665
35.61
04/25/2005
446,798,215
102,770,865
23.00
04/26/2005
358,804,989
10,000
0.00
04/27/2005
355,642,755
10,000
0.00
04/28/2005
359,632,068
10,000
0.00
04/29/2005
386,111,868
3,073,000
0.80
Through a quick review of EDSARS, and the reported threshold lists
published for April 22, 2005, 56 of the 150+ securities listed for
the AMEX, OTCBB, and Pink Sheets would require a minimum of 29
Million shares in FTD simply to qualify at minimum threshold levels
of 0.5% of outstanding shares. Scaling out to 150 companies would
represent nearly 100 Million shares in FTD as a minimum to qualify
for Regulation SHO and these 100 Million would be additive to the
CMKX FTD.
The fact that many of the companies published on the April 22, 2005
threshold list had been on for some time and remain entrenched on the
list today certainly questions any possibility that these companies
were any where near minimum qualification levels of 100 million.
By simple analysis, it is easy to conclude that far better than 60%
of the aggregate FTD in over 9000 companies is reportedly owned by as
little as 1.6% of the companies in these markets. Data I personally
do not believe to be even remotely accurate as represented by the FTD
information provided.
The SEC and NASD have specific sections of their web sites dedicated
to informing the investing public about the problems of the OTCBB and
Pink Sheet Markets. These quotation services are quoted as being ripe
for scams and fraudulent activities. The SEC has taken counter
measures to avoid pump and dump schemes by initiating exemptions for
the industry to sell naked short into the market to control market
volatility. Yet the data illustrates that less than 2% of these
issuers seemingly control far better than 60% of the aggregate FTD. A
metric of performance far better than the upper echelon markets of
the NYSE and NASDAQ.
When questioning the data simply look at the reported FTD between
April 20 and April 22.
While the FTD level in over 9000 companies remained the same [520
Million shares] the number of FTD in CMKX grew from 83 million to 186
Million representing a growth from 15% to 35% of the markets reported
aggregate FTD. One company grew by 20% of the aggregate reported and
the rest of the 8999 companies absorbed that number with an exact
equal and opposite reduction, in two days worth of trading? Yet,
between April 19 and April 20, as the markets aggregately moved up by
100 million FTD's, CMKX reduced by 2 million shares in FTD status.
Which is it, CMKX was trading as bell weather for FTD or not?
I am not sure about you but it does not take a rocket scientist to
look at this evidence and decide that something is happening behind
the curtain. It now time to open up that curtain and reveal the truth
to the investing public.
It is now SHO and Tell time for the SEC.
For more on this issue please visit the Host site at
www.investigatethesec.com .
www.allstocks.com/stockmessageboard/ubb/ultimatebb.php/ubb/get_topic/f/8/t/017119/p/3.html...Flying Moose(cmkxunofficial)