Block, SkipCaptcha, apieditor, Automoderated users, Bots, edit, ratelimit-exempt
58,859
edits
Changes
mLine 79:
Line 79: − + − + Line 90:
Line 90: − + Line 197:
Line 197: − + Line 209:
Line 209: − + − +
HTTP --> HTTPS #3, replaced: http://www.cnbc.com → https://www.cnbc.com, http://www.forbes.com → https://www.forbes.com (8)
Ten suits concerning naked short-selling filed against the DTCC were withdrawn or dismissed by May 2005.<ref> "Nevada Court Dismisses Nanopierce Lawsuit Against DTCC On Naked Short Selling," Depository Trust Clearing Corporation, http://www.dtcc.com/Publications/dtcc/may05/nanopierce.html, May 2005. Accessed February 5, 2007</ref>
Ten suits concerning naked short-selling filed against the DTCC were withdrawn or dismissed by May 2005.<ref> "Nevada Court Dismisses Nanopierce Lawsuit Against DTCC On Naked Short Selling," Depository Trust Clearing Corporation, http://www.dtcc.com/Publications/dtcc/may05/nanopierce.html, May 2005. Accessed February 5, 2007</ref>
A suit by Electronic Trading Group, naming major Wall Street brokerages, was filed in April 2006 and dismissed in December 2007.<ref>{{cite news | url = http://www.forbes.com/business/2006/04/13/naked-shorts-lawsuit-cx_lm_0413naked.html | title = Naked Shorts | publisher = [[Forbes]] | first = Liz | last = Moyer | date = [[2006-04-13]] | accessdate = 2007-10-10}}</ref>.<ref>[https://money.cnn.com/news/newsfeeds/articles/djf500/200712201132DOWJONESDJONLINE000859_FORTUNE5.htm US Judge Dismisses Naked Short Selling Suit Vs. Brokers, Dow Jones News Service, Dec. 20, 2007]</ref>
A suit by Electronic Trading Group, naming major Wall Street brokerages, was filed in April 2006 and dismissed in December 2007.<ref>{{cite news | url = https://www.forbes.com/business/2006/04/13/naked-shorts-lawsuit-cx_lm_0413naked.html | title = Naked Shorts | publisher = [[Forbes]] | first = Liz | last = Moyer | date = [[2006-04-13]] | accessdate = 2007-10-10}}</ref>.<ref>[https://money.cnn.com/news/newsfeeds/articles/djf500/200712201132DOWJONESDJONLINE000859_FORTUNE5.htm US Judge Dismisses Naked Short Selling Suit Vs. Brokers, Dow Jones News Service, Dec. 20, 2007]</ref>
Two separate lawsuits, filed in 2006 and 2007<ref>{{cite news | title = Naked Short Victim Strikes Back | url = http://www.forbes.com/2007/02/02/naked-short-suit-overstock-biz-cx_lm_0202naked.html | date = [[2007-02-02]] | accessdate = 2007-10-10 }}</ref> by [[NovaStar Financial, Inc.]] shareholders and [[Overstock.com]], named as defendants ten Wall Street prime brokers. They claimed a scheme to manipulate the companies' stock by allowing naked short selling.<ref>[http://www.forbes.com/2007/02/02/naked-short-suit-overstock-biz-cx_lm_0202naked.html A Naked Short Victim Strikes Back, Forbes.com, Feb. 2, 2007]</ref> A motion to dismiss the Overstock suit was denied in July 2007.<ref> {{cite web |url=http://www.forbes.com/wallstreet/2007/07/18/naked-shorting-overstock-biz-wallst-cx_lm_0718overstock.html
Two separate lawsuits, filed in 2006 and 2007<ref>{{cite news | title = Naked Short Victim Strikes Back | url = https://www.forbes.com/2007/02/02/naked-short-suit-overstock-biz-cx_lm_0202naked.html | date = [[2007-02-02]] | accessdate = 2007-10-10 }}</ref> by [[NovaStar Financial, Inc.]] shareholders and [[Overstock.com]], named as defendants ten Wall Street prime brokers. They claimed a scheme to manipulate the companies' stock by allowing naked short selling.<ref>[https://www.forbes.com/2007/02/02/naked-short-suit-overstock-biz-cx_lm_0202naked.html A Naked Short Victim Strikes Back, Forbes.com, Feb. 2, 2007]</ref> A motion to dismiss the Overstock suit was denied in July 2007.<ref> {{cite web |url=https://www.forbes.com/wallstreet/2007/07/18/naked-shorting-overstock-biz-wallst-cx_lm_0718overstock.html
|title=Naked Shorting Case Gains Traction|date=July 18, 2007|Author=Liz Moyer, Forbes}}</ref><ref>[https://www.bloomberg.com/apps/news?pid=conewsstory&refer=conews&tkr=OSTK:US&sid=aPgnC8667Qbo Overstock Shares Rise on Court Ruling in Broker Suit], Bloomberg News, July 18, 2007</ref>
|title=Naked Shorting Case Gains Traction|date=July 18, 2007|Author=Liz Moyer, Forbes}}</ref><ref>[https://www.bloomberg.com/apps/news?pid=conewsstory&refer=conews&tkr=OSTK:US&sid=aPgnC8667Qbo Overstock Shares Rise on Court Ruling in Broker Suit], Bloomberg News, July 18, 2007</ref>
Legislators said they repealed the law with the understanding that the SEC would act on a federal level to alleviate naked shorting concerns. Utah state senate majority leader [[Curtis Bramble]] said at the time of repeal that he now believed that Overstock's motives were "highly suspect." Bramble said, "There are those who believe Overstock has been using the Legislature as a distraction against its own problems. It raises serious questions."<ref>[http://select.nytimes.com/2007/03/10/business/10nocera.html?_r=1&scp=1&sq=+Revisiting+Overstock.com+and+Utah&st=nyt&oref=slogin Revisiting Overstock.com and Utah], by Joe Nocera, The New York Times, Mar. 10, 2007</ref>
Legislators said they repealed the law with the understanding that the SEC would act on a federal level to alleviate naked shorting concerns. Utah state senate majority leader [[Curtis Bramble]] said at the time of repeal that he now believed that Overstock's motives were "highly suspect." Bramble said, "There are those who believe Overstock has been using the Legislature as a distraction against its own problems. It raises serious questions."<ref>[http://select.nytimes.com/2007/03/10/business/10nocera.html?_r=1&scp=1&sq=+Revisiting+Overstock.com+and+Utah&st=nyt&oref=slogin Revisiting Overstock.com and Utah], by Joe Nocera, The New York Times, Mar. 10, 2007</ref>
Byrne described the repeal as a cave-in to industry pressure. "Tuesday night, Overstock Chief Executive Patrick Byrne compared Bramble's about-face on the issue to a betrayal, using a reference to the movie Jerry Maguire to make his point. 'It's like that scene where Jerry McGuire figures out that a prospect's father has sold him out by signing with a competitor. McGuire says, "Now. Wait. Tell me you didn't sign. Because I'm still sort of moved by your 'my word is stronger'n oak' thing," ' Bryne wrote in an e-mail." [http://www.forbes.com/2007/02/28/naked-shorts-utah-biz-cx_lm_0228naked.html?partner=yahootix]
Byrne described the repeal as a cave-in to industry pressure. "Tuesday night, Overstock Chief Executive Patrick Byrne compared Bramble's about-face on the issue to a betrayal, using a reference to the movie Jerry Maguire to make his point. 'It's like that scene where Jerry McGuire figures out that a prospect's father has sold him out by signing with a competitor. McGuire says, "Now. Wait. Tell me you didn't sign. Because I'm still sort of moved by your 'my word is stronger'n oak' thing," ' Bryne wrote in an e-mail." [https://www.forbes.com/2007/02/28/naked-shorts-utah-biz-cx_lm_0228naked.html?partner=yahootix]
==Controversy Over the Pervasiveness of Naked Shorting==
==Controversy Over the Pervasiveness of Naked Shorting==
In September, 2006, Bloomberg Magazine's Bob Drummond wrote [http://images.overstock.com/f/102/3117/8h/www.overstock.com/06-09BloomMarket_NSS.pdf "Games Short Sellers Play"], alleging that "Traders who sell shares they don’t own—and haven’t even borrowed—are driving down prices. More than 425 companies a month may be the victims of these schemes."
In September, 2006, Bloomberg Magazine's Bob Drummond wrote [http://images.overstock.com/f/102/3117/8h/www.overstock.com/06-09BloomMarket_NSS.pdf "Games Short Sellers Play"], alleging that "Traders who sell shares they don’t own—and haven’t even borrowed—are driving down prices. More than 425 companies a month may be the victims of these schemes."
In February, 2007 Forbes Magazine published two stories supporting the view that naked shorting is a serious problem in US capital markets. One article, [http://www.forbes.com/free_forbes/2007/0212/068.html "Naked and Confused"], described the naked shorting attack on Sedona, a Pennsylvania software firm. Another article, [http://www.forbes.com/free_forbes/2007/0212/064.html "Sewer Pipes"], explored the apparent involvement of the Russian Mafia in this issue: "Hedge funds are posting nice returns from deals that may involve ex-cons, stock scammers--even the Mob."
In February, 2007 Forbes Magazine published two stories supporting the view that naked shorting is a serious problem in US capital markets. One article, [https://www.forbes.com/free_forbes/2007/0212/068.html "Naked and Confused"], described the naked shorting attack on Sedona, a Pennsylvania software firm. Another article, [https://www.forbes.com/free_forbes/2007/0212/064.html "Sewer Pipes"], explored the apparent involvement of the Russian Mafia in this issue: "Hedge funds are posting nice returns from deals that may involve ex-cons, stock scammers--even the Mob."
In March 2007, [[Bloomberg Television]] featured a special on naked short selling, "Phantom Shares" that presented a sharp criticism of naked short selling in the US capital markets. Phantom Shares' was nominated for an Emmmy for Long Form Investigative Journalism. <ref>{{cite web|url=https://www.bloomberg.com/avp/avp.htm?clipSRC=mms://media2.bloomberg.com/cache/vIrfhgQPAJ1s.asf |title=Phantom Shares |author=Bloomberg Television |date=March 12,2007}}</ref> <ref>{{cite web|url=https://www.bloomberg.com/apps/news?pid=conewsstory&refer=conews&tkr=OSTK:US&sid=aEOpTqmLZB7A|title=`Phantom Shares,' Failed Trades and Naked Shorts: (Transcript) |author=Bloomberg Television |date=March 14,2007}}</ref>
In March 2007, [[Bloomberg Television]] featured a special on naked short selling, "Phantom Shares" that presented a sharp criticism of naked short selling in the US capital markets. Phantom Shares' was nominated for an Emmmy for Long Form Investigative Journalism. <ref>{{cite web|url=https://www.bloomberg.com/avp/avp.htm?clipSRC=mms://media2.bloomberg.com/cache/vIrfhgQPAJ1s.asf |title=Phantom Shares |author=Bloomberg Television |date=March 12,2007}}</ref> <ref>{{cite web|url=https://www.bloomberg.com/apps/news?pid=conewsstory&refer=conews&tkr=OSTK:US&sid=aEOpTqmLZB7A|title=`Phantom Shares,' Failed Trades and Naked Shorts: (Transcript) |author=Bloomberg Television |date=March 14,2007}}</ref>
In July 2007, United States Senator Bob Bennett suggested on the [[U.S. Senate]] floor that the allegations involving DTCC and naked short selling are "serious enough" that there should be a hearing on them with DTCC officials by the [[Senate Banking Committee]]. The committee's Chairman, Senator [[Christopher Dodd]], indicated he was willing to hold such a hearing.<ref>[http://bennett.senate.gov/press/record.cfm?id=279519 "Senator Bennett Discusses Naked Short Selling on the Senate Floor," Website of Senator Bennett, July 20, 2007, accessed 32-2-2008]</ref>
In July 2007, United States Senator Bob Bennett suggested on the [[U.S. Senate]] floor that the allegations involving DTCC and naked short selling are "serious enough" that there should be a hearing on them with DTCC officials by the [[Senate Banking Committee]]. The committee's Chairman, Senator [[Christopher Dodd]], indicated he was willing to hold such a hearing.<ref>[http://bennett.senate.gov/press/record.cfm?id=279519 "Senator Bennett Discusses Naked Short Selling on the Senate Floor," Website of Senator Bennett, July 20, 2007, accessed 32-2-2008]</ref>
Also in July, 2007, Forbes published another article, [http://www.forbes.com/wallstreet/2007/07/18/naked-shorting-overstock-biz-wallst-cx_lm_0718overstock.html?partner=whiteglove_google "Naked Shorting Case Gains Traction"] concerning the failure of the prime brokerage industry to get a judge to dismiss litigation by Overstock.com against them.
Also in July, 2007, Forbes published another article, [https://www.forbes.com/wallstreet/2007/07/18/naked-shorting-overstock-biz-wallst-cx_lm_0718overstock.html?partner=whiteglove_google "Naked Shorting Case Gains Traction"] concerning the failure of the prime brokerage industry to get a judge to dismiss litigation by Overstock.com against them.
According to [http://www.buzzle.com/articles/187364.html ''The Guardian''], Bear Stearns CEO Alan Schwartz has maintained naked short selling played a role in the March, 2008 collapse of Bear Stearns.
According to [http://www.buzzle.com/articles/187364.html ''The Guardian''], Bear Stearns CEO Alan Schwartz has maintained naked short selling played a role in the March, 2008 collapse of Bear Stearns.
Lehman Brothers [http://www.cnbc.com/id/23903238 CEO Dick Fuld has gone on CNBC] to make this claim as well: "Lehman Brothers CEO Richard Fuld has instructed his legal staff to tell regulators that he has information suggesting that short-selling hedge funds colluded to help cause the demise of Wall Street investment bank giant Bear Stearns, sources told CNBC."
Lehman Brothers [https://www.cnbc.com/id/23903238 CEO Dick Fuld has gone on CNBC] to make this claim as well: "Lehman Brothers CEO Richard Fuld has instructed his legal staff to tell regulators that he has information suggesting that short-selling hedge funds colluded to help cause the demise of Wall Street investment bank giant Bear Stearns, sources told CNBC."
On April 3, 2008, SEC Chairman Chris Cox, [http://youtube.com/watch?v=z-aInPKicho testified to the United States Senate] that the SEC is investigating whether or not Bear Stearns was brought down by "illegal naked short selling".
On April 3, 2008, SEC Chairman Chris Cox, [http://youtube.com/watch?v=z-aInPKicho testified to the United States Senate] that the SEC is investigating whether or not Bear Stearns was brought down by "illegal naked short selling".