Sam Antar has uncovered some interesting information. I would love for Patrick Byrne, Overstock CEO to respond to Sam’s questions about this (and now the questions are mine too!).
Short selling is the practice of borrowing stock, then selling it in hopes that the price will go down and it can be bought back at a lower price with shares to replace the borrowed ones. “Naked shorting” refers to short selling a stock for sale without first borrowing the shares or making an “affirmative determination” that the shares can be borrowed. The U.S Securities and Exchange Commission has issued a regulation, known as Reg SHO, seeking to curb abusive naked shorting.
On the NCANS message board, Patrick Byrne (aka Hannibal) posted the following :
Posted: Tue Feb 15, 2005 9:21 pm
Subject: Cry ‘Havoc!’ And let slip the dogs of war.
ONCE AGAIN, DO NOT MAKE ANY STOCK PURCHASE DECISIONS BASED ON WHAT I AM EXPLAINING HERE. I JUST THINK IT IS TIME THAT PEOPLE OUTSIDE WALL STREET LEARN A BIT ABOUT HOW THEY PLAY THE GAME THERE.
Now the story gets really interesting. We came out swinging last week with a full page ad in The Washington Post, explaining this issue. It cost $100,000: I donated about $20k of that, and spent a lot of time working with O’Brien through email (as I have never met him yet), getting the ad just right. Meanwhile, he opened his ncans.net site, which explains all of this thoroughly.
In the last few days, The Empire Has Begun To Strike Back. That will be the subject of my next posting.
Bold has been added by me.
Then on May 28, 2007, in a post on InvestorVillage.com, Patrick wrote the following under his Hannibal screen name:
How much was paid to the National Assn. Against Naked Shortselling?:
A COUPLE YEARS AGO I DONATED AROUND $75K TO NCANS (I ASSUME THAT IS WHAT YOU MEAN?) BUT BOBO USED THAT TO BUY AN AD IN THE WASHINGTON POST SO I DO NOT THINK OF THAT AS A “PAYMENT” TO BOBO.
Bold is again added by me.