Naked Short Selling

Patrick Byrne is a leading voice in a growing movement convinced that powerful interests on Wall Street are destroying American companies for profit - robbing investors and destabilizing our financial system in the process.
Patrick's battle for fair markets is being waged on several fronts.
Because Regulation SHO, the SEC's half-hearted attempt to reduce illegal naked shorting, is itself a failure, Patrick actively supports state and federal legislative efforts to end illegal naked short selling.
Patrick helped craft a pair of lawsuits filed by Overstock.com shareholders against the miscreants whose strategic, illegal naked shorting has kept companies like Overstock.com on the Reg SHO list for over two years now.
The first lawsuit, filed in August of 2005 against Rocker Partners hedge fund and so-called independent research firm Gradient Analytics, claims libel, unfair business practices and tortuous interference. The suit is based largely on the affidavits of three former Gradient Analytics employees who affirm, under oath, that Gradient Analytics published false and misleading research that was in fact prepared by associates of David Rocker, principal of Rocker Partners hedge fund. The suit further alleges that Rocker Partners expected to profit from the drop in Overstock.com's share price that resulted when Gradient Analytics published the tainted research.
The second lawsuit, filed in January of 2007 against 12 Wall Street prime brokerages, claims a massive, illegal stock market manipulation scheme based on naked short selling: brokers lending shares they don't posses to short sellers with no intention of covering their illegal short positions to begin with; resulting in a dangerous build-up of persistent delivery failures. Economists agree that this sort of strategic failure to deliver is commonplace, targeted, responsible for depressing target companies' share prices, and potentially destabilizing to America's financial system.
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