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Will The Last Person Please Burn The Building Down; It Is Time To End The Farce That Is The SEC
The SEC sure has a sense of humor. With everyone screaming for the agency's blood unless it does something to curb rampant and blatantly speculative high frequency trading, as well as to tighten insider trading regulation, what does the Mary Schapiro-lead circus do? Just the opposite. And even as the commission is weeping that its $1 billion budget is woefully inadequate, the agency decides to reduce its own projected revenue in the form of Section 31 fees, to benefit the High Frequency Scalping brigade. The schizophrenic, sociopathic, deranged lunatics have certainly taken over the asylum at 100 F Street, NW Washington.
Zero Hedge has written previously about Section 31. We also, prophetically, pointed out, that the SEC is massively conflicted on the topic of HFT as the paradigm generates revenues for the agency. We, however, did not realize just how conflicted Mary Schapiro is, and just how pervasive the HFT lobby power is: in order to make the lives of High Frequency Traders easier (and their lobby ever wealthier), the SEC is willing to axe one of its own revenue streams. All this is happening even as the SEC is bleating daily that its catastrophic corruption and incompetence can be easily fixed by just one or two $100 million budget boosts. And with the US taxapayer raped daily by the administration, certainly not an ounce of KY will be needed to fill the... budget shortfall from making the P&Ls of HFTs even more artificially propped up.
Yes, we are not making this shit up. Read the following SEC press release and weep:
Effective Jan. 15, 2010, the Section 31 fee rate
applicable to securities transactions on the exchanges and
over-the-counter markets will decrease to $12.70 per million dollars.
Until that date, the current rate of $25.70 per million dollars will
remain in effect. The Section 31 assessment on security futures
transactions will remain unchanged at $0.0042 per round turn
transaction. The Office of Interpretation and Guidance in the
Commission's Division of Trading and Markets is available for questions
regarding Section 31 and may be reached at (202) 551-5777 or by e-mail
at tradingandmarkets@sec.gov.
So much for inflation:
Under the Investor and Capital Markets Fee Relief Act, the
Commission is required to adjust the filing and securities transaction
fee rates on an annual basis to levels the SEC estimates will generate
collections equal to numeric targets set in the statute. A copy of the
Commission's April 30, 2009, order regarding fee rates under Section
6(b) of the Securities Act of 1933 and Sections 13(e), 14(g), and 31 of
the Securities Exchange Act of 1934 for fiscal year 2010 is available
at http://www.sec.gov/rules/other/2009/33-9030.pdf.
And here is the piece de resistance that proves that the SEC is convinced only illiterate apes who have access to a busted abacus fetish read its press releases:
The adjusted fee rates will not affect the amount of funding
available to the Commission. The Commission will announce the new fee
rates for fiscal year 2011 no later than April 30, 2010. These fee
rates will become effective Oct. 1, 2010, or after the Commission's
fiscal year 2011 appropriation is enacted, whichever is later.
We are certain that the GETCO et als of the HFScalping world have sent numerous "To Cash" checks and Christmas cards expressing their gratitude to the tradingandmarkets@sec.gov address. We urge all our readers to do the same. After all, the ponzi casino has to be kept up one way or another, lest everyone realize just how hollow the US stock market truly is.
And since bullshit rarely travels alone, why should the SEC's public excretions, er, relations, machine be any exception. The other SEC press release that caught our eye is simply a stunner. It appears that the SEC is planning to gradually repeal Reg FD. Long live insider trading. They caught Raj Raj (and SAC is allegedly going down next) - so their quota for the next 20,000 years is now fulfilled.
If you feel like blowing chunks at your monitor, please read the following insanity:
Washington, D.C., Dec. 22, 2009 — The Securities and Exchange
Commission today announced that it has proposed amendments to Rule 163
under the Securities Act to further facilitate the ability of certain
large companies to communicate with broader groups of potential
investors and gauge the level of interest in the market for their
securities offerings.
In other words, Reg FD can be circumvented in order to make sure that the 18,274th in a row follow-on offering for DDR or Kimco will go through without a glitch, 1E^1,000,000,000 dilution be damned.
The proposed amendments would apply to companies that are
"well-known seasoned issuers" (WKSIs) and would allow them to authorize
an underwriter or dealer to communicate with potential investors on
their behalf about potential securities offerings prior to filing
registration statements for such offerings. Under the current Rule 163,
only WKSIs are permitted to communicate directly with potential
investors before filing a registration statement.A WKSI is an issuer that is current and timely in its Exchange Act
reports for at least one year and has either $700 million of
publicly-held shares or has issued $1 billion of non-convertible
securities, other than common equity, in registered offerings for cash
in the preceding three years.
Thanks for the politically correct thesaurus SEC, but we all know that anyone looking up the definition of "well-known seasoned issuers" will see the logo of every single REIT/ML client extraordinaire for 2009.
All other current requirements of Rule 163 would continue to apply,
including that all communications made by or on behalf of the WKSI in
reliance on the rule would be subject to Regulation FD (Fair
Disclosure).
Oh really - and who gets to enforce Reg FD in this exclusionary context? You SEC? Last time we checked you were still in a dark corner attempting to discover your gluteus maximus using a taxpayer subsidized 1 megawatt flashlight, and still shellshocked by just how it happened that one Judge Rakoff managed to expose you for the greedy, corrupt, pathetic, sycophantic, incompetent, worthless and soon to be hopefully disbanded and prosecuted den of thieves you truly are.
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Yes...... pay the corporations to trade the market and make massive profits, but tax the individual trader who adds actual liquidity.
Nice.
I suppose the less well known less seasoned issuers are jealous.
When your job is to protect the markets and the markets are controlled by thieves, then your job is to protect the thieves. It's only logical.
Think realistically.
+1
"well-known seasoned issuers"
aka "well-known seasoned screwers".
Just when you think it can't get worse, it does. There is no concern on the part of the SEC of a public backlash or a Congressional reading of the riot act. They simply don't care. They know who their masters are and it ain't us.
Hey Rahm...
We've been telling you that Mary and certainly Larry, Timmy, and, most definitely, Ben Bernanke are screwing the pooch (that would be most of us American citizens) and this is just another of many, many examples.
I suppose the Rasmussen poll today has nothing to do with this, eh?
Let me put another way in your language, Rahm. You guys phucked up completely on handling the banking, financial, economic crisis and Americans have figured it out. No blaming it anymore on the previous administration either: you hired their phucking guys Rahm!
You phucking blew it Rahm. You have been wrong. Because of your stupidity letting Bernanke and Summers run things (naturally, ably assisted by Dimon, Blankfein, et al), we are now going to be worse off and you phucking know it.
Naturally, you already have your excuse built in on the geopolitical front when the shit hits the fan in any number of hotspots....."oh, the recovery was going perfectly until _________________"
Helluva job, Rahmmy
Hey deadhead, I'm with the SEC, too. I thought you would understand.
Love Rahm
Who would be Sultan when he could be Grand Visier?
And on a related note, how the hell is it that Karl Rove is still running around free?
Apparently, Americans regard sexual infidelity as far more serious than invading countries on the basis of false charges and deception, invasions that have caused the deaths and displacement of millions of innocent people. Remember, the House impeached President Clinton not for his war crimes in Serbia, but for lying about his affair with Monica.
Rasmussen is the Rt wing nut-fringe polling group, thats why they do so much work for Fox News and the Republician party. Their numbers are always the outlier when pollisters ask the same questions.
Take some time to research before you quote a source.
Rasmussen is the Rt wing nut-fringe polling group, thats why they do so much work for Fox News and the Republician party. Their numbers are always the outlier when pollisters ask the same questions.
Take some time to research before you quote a source.
Rasmussen is the Rt wing nut-fringe polling group, thats why they do so much work for Fox News and the Republician party. Their numbers are always the outlier when pollisters ask the same questions.
Take some time to research before you quote a source.
"Rasmussen is the Rt wing nut-fringe polling group"
hey- thanks for telling us three times
Obama is polling pretty poorly in the other polls that I have seen.
I can tell you this: he has pissed off his base (i'm not part of that base) due to the abortion of health care reform. actually, he has pissed off most of America and for that matter has missed the mark as approx 30ish% of Americans see that as a biggie (it's the economy stupid!). He has really upset his base on his military strategy. On the banking, wall street mess, he has pissed off everybody.
the mantra on the guy now (from my readings of both lib and cons media) seems to be shifting to one of all bullshit, no defined action.
his actions on the financial crisis clearly shows he is being played like a puppet by the same old crew. perhaps the same is true of health care by the big insurance companies.
I understand your point about Rasmussen and agree that all polls have their biases. Bottom line, for a guy that so many people adored one year ago, he certainly has gone into the shitter of public opinion pretty quickly. This week's Newsweek quotes Gallup that Obama's job approval rating is 49%. The last Pres under 50% at the end of the first year was Reagan.
"his actions ... shows he is being played like a puppet by the same old crew"
O is a BEARD, not a puppet....
there is a difference
is that because he stroked his handlers until his numbers were shaved?
Maybe Obama will become Jesus to the Democrats like Reagan did to the Republicans in due time?
LOL DH - nice one. I like it when you get to rippin. I will ask one question. Did Rham phuck it up? (In the sense of whom is he serving?) Sure, they all screwed us, but look whom has benefited. Alas the socialist state is reaping the benefits and that sucking sound you hear is at a crescendo as there is nothing left to suck. I have a personal ban on rants thru Xmas and maybe into next year, but will be back with a vengeance soon. Thanks for picking up some of my slack.
Rahm did not screw up anything. He did exactly what was best for him. Ask him how he pays no real estate taxes in chicago? It is a hilarious story. Also, he came from the 5th congressional district- who is ( and was) the major political shaker in that district - in other words - who controls it? I read this blog every day and cannot believe most people here are so innocent.
The knavery is so high, no one tries to hide it anymore. Well known, indeed.
Exactly. The U.S. is falling into something akin to the Soviet breakdown. The police are on the payroll. The masses are divided into two groups: Those who never cared about freedom and liberty, justifying any governmental largess bestowed upon them at others' expenses as merely their rightful turn at the till (why, anyone with anything gets it by screwing someone, right?), to be defended at all cost. Every man for himself and his family. The others are the well intended working class, blue and white, who just want to get along, unaware they hold hands and sing “kumbaya” as the ship lists ever more to the left, while the leaders they've elected continue to hack away on the hull selling what they can for personal grandeur. (Of course, you’ve also got the crazies awaiting the rapture in the great in-between, if only the Mid East would just blow up and get to it. (Come on Israel, take out Iran!))
Those who understand the problems are white collars with an intellectual quirk. We have little recourse other than to flee a sinking ship, the Rubicon having long ago been crossed. After all, have you ever tried to explain this stuff to a non-financial type who isn't intellectually inclined? May as well be speaking in ancient Hittite. Besides, most would rather be expert in / drift into the haze with their latest episode fix of American Big Gladiator Idol's Brother, or Desperate House-sluts and the City, or for that matter, Wrestle-Mania MCLXVII . Rule out any revolution at the ballot box with that lot. The people will get what they want, and good and hard.
And forget any other revolution until what's left of the productive economy finally succumbs / is overwhelmed by this massive, parasitic infection. There will be chaos in the streets. Generations don't know how to take care of themselves without welfare checks; others, their teat of money printed out of thin air to support their financial jobs; yet more, their arbitrarily generated, mindless regulatory jobs tied to complexity piped into their plates from D.C., for which they charge heavy protection money. Etc. Each has no productive, wealth building value they can exchange with others unless they’re backed by the point of a gun as they have been for decades, and this will be exposed amid the collapse.
Hopefully the spoils will return to those who can actually provide freely desired, mutually consensual value for his / her fellow man (vs. the commonplace, coerced crap we now mistake for a market economy.). I fear it may all end up in the hands of the raiding hordes most willing to ruthlessly take for themselves in the plainspoken terms of rape, pillage and plunder.
At least then it'll be clear who the enemy is. So much more genuine than GS, et al, the current regime, political banking nexus, etc.
The SEC guts itself. Wow.
I stumbled across an article from a 1924 Popular Mechanics, Googled in books.
Excerpt...
U.S. Wealth Rises Seventy Percent during Last Ten Years
"Rises in prices, it is stated, largely explain the increases in money values,"
This was just a little over a decade from the inception of the Federal Reserve in 1913.
Cheers!
The tone of this blog has deteriorated to the shrill level of the commentors. Perhaps that is the business model, i.e. sarcasm and vulgarity rather than constructive criticism. If anything is going to be changed with the powers that be, if any respect is to be sought by the blog, then the language should revert to the serious and respectful commentary that drew me here. And the abbreviations ought to be dispensed with for all but the most obvoius. Just a suggestion.
What have you done personally to counteract the largest heist in history and what WILL you do going forward ?
I am outraged at some of the stuff I read about here but I look for ways of spreading the news in such a way that it will not be dismissed as just rabid banter. If some of the material that is presented on this blog is packaged a little better it could get more mainstream media attention and the blog could be cited in commentary form in main stream media articles. Spreading the message with a good tone is the way to go.
RepectABILITY seems to be declining rapidly. I think we are about a year past respect.
It's time for ... Madlibs!
"The tone of this nation has deteriorated to the shrill level of the citizenry. Perhaps that is the WallStreet model, i.e. theft and looting rather than constructive productivity. If anything is going to be changed with the powers that be, if any respect is to be sought by the country, then the discussion should revert to the serious and respectful matters of liberty , justice and opportunity that originally drew our forefathers to create a new nation."
There ain't nuth'n you can pervert that I cannot subvert. May be best patriot win.
cougar
I definetly agree with you. Comments are there to make useful contributions not to just spit out the first thing that comes to mind. It has become a real hassle to find the good comments among all of these gargabe comments.
As a newbie, I enjoy the challenge of interpreting the abbreviations and acronyms that real traders use. I also think that if the authors on here had to write articles that were ready to publish in Time magazine that it would inhibit their style and that's what everyone loves about ZH.
Keep it real ZH!
As a newbie, I enjoy the challenge of interpreting the abbreviations and acronyms that real traders use. I also think that if the authors on here had to write articles that were ready to publish in Time magazine that it would inhibit their style and that's what everyone loves about ZH.
Keep it real ZH!
Agreed. Although I love the scathing wit and sarcasm of Tyler and Marla, the commentary shouldn't read as though it were written by an 18 year-old troll on youtube.
In this instance, however, I concede that the quality of the disclosure and its relative obscurity (I would never, on my own, log on to the SEC's website to read their releases) are a saving grace.
Hidden agenda
Methinks you speak for Blankfein
Calling you out bitch
Shrill isn't even a registered level on my decibel meter. Too low.
Although I know where you are coming from, Anon, when the punters have had their Halls of Justice, Chambers of Commerce, Houses of Representatives all blinded, corrupted, silenced and coerced, the value of their medium of exchange and savings destroyed, when it seems that nobody of position cares, it is time for stomping.
In times of turmoil, polite verbal intercourse is reserved for the elite. It's called diplomacy. They have etiquette and rules established amongst themselves that are designed to prevent them shooting one another. Honor among thieves and all. It is obvious that they reserve these rules for themselves but conveniently forgot to include us in their club. As we don't matter to them, it's time to return the love. They have got legal power, we have ours, it's in the constitution. Get out of the way when it starts.
Berlisconi(?) was he the start? Notice they labeled the guy a mental case. He was crazy all right. He should have chosen something heavier.
My amazement began quite a few years ago following the President's Working Group. I have continuously wondered how markets could rise in the face of economic malaise. I have been ridiculed for raising conspiracy theories but I believe we are well beyond the point where one wonders if there are artificial forces injected into the markets. The reality is, however, many people don't want to even consider the reality of our mess. They don't want to believe that life as we know it could change... they just want the good times to keep rolling along. An educated person would say our markets must correct themselves and thus investments should be made in contemplation of a correction. Problem is the artificial forces won't let the market correct. And those forces are so strong they may well prolong the artificial effects indefinitely. In 1776 the colonists revolted. I do not believe our nation is anywhere near the desire for change that was apparent before 1776 but if the forces that are in play today lose traction and there are major dislocations then I would agree with you; it will be time to get out of the way. Washington's blog had a good quote about establishments propping up existing order and the theory seems right on point here to. Its hard to accept the fact that our leaders are engaged in a Ponzi scheme but the reality is they probably are. How do they sleep at night? Do they believe they are doing good for our society? My point in the original post regarding the tone of this blog is to connect some of the dots that point to the Ponzi scheme in order to expose it with credible information. Look at what is going on in Dubai; thats a place where the rubber is hitting the pavement with force. We should be looking at that place with a microscope and talking about the facts with a megaphone. Dubai maybe ground zero for the detonation of the biggest Ponzi scheme ever. These are just rambling thoughts but I'll bet someone smarter than me will be connecting the dots soon.
"Judge Rakoff managed to expose you for the greedy, corrupt, pathetic, sycophantic, incompetent, worthless and soon to be hopefully disbanded and prosecuted den of thieves you truly are."
Nice. I like this Tyler.
The deadweight loss from regulation is far greater than any losses from insider trading, HFT, and violations of Reg FD combined. And you want the SEC to confiscate more from taxpayers to continue the lie that it can insulate them from unfavourable outcomes? Then you're surprised that the insiders capture the regulator? I can't believe you're serious.
The entire agency needs to be scrapped. Fraud is already illegal, without the SEC.
Please stop HFT bashing. I'm from Canada, and the reason I don't bother with Canadian stocks is there isn't much liquidity and spreads are much wider and bid/ask jumps around more often. Most of US equities don't have that issue. Intraday scalping 10-20 cents on large number of shares got much smoother in US equities.
SEC has always worked for the Banks. It is there to give the public an illusion of fairness.
How many times have Companies paid a very small fine for Blaintant violations? Way too many. The problem with the Fines is that the Companies claim no wrongdoing and are protected from Law Suits by Shareholders who have been harmed.
It appears like the SEC is like the Mafia that gets a take for illegal operations. The Shareholders are never compensated from the Fraud discovered by the SEC.
It has always gotten under my skin that the SEC benifits from wrongdoers thru their fines and thoes who were actually harmed never get a dime. Plus, the fines and no admission of wrongdoing lets the Companys off the hook for Law Suits.
This isn't going to change until the MSM starts reporting on it.
"The tone of this blog has deteriorated to the shrill level of the commentors. Perhaps that is the business model, i.e. sarcasm and vulgarity rather than constructive criticism."
WHAT? When our very own gooberment is lying to us and screwing us, you don't have a problem with it? Vulgar? How aboput the actions of these people in the financial circus we call the FED RES and the SEC.
These idiots are supposed to be working for ***all Americans***, and not just a few CEO's and politicos.
IF "Confidence in the market" is a major factor in investing, then they (gooberment) have as aptly stated "screwed the pooch"!
Somehting the rest of us have figured out is that these idiots are not listening to "constructive criticism" ie health care bill, TARP, ARRA,and all the rest of the bills that the American Citizens clearly told the elected representation not to pass.
The time for "constructive criticism" is way over, and there may be a coming dawn of "direct" and "Darwinian" and "Draconian" corrections on behalf of the citizenry toward the elected representation and the CEO and all.
That day will be revolution, and starts a week after next years market crash.
People will be hurting like never before. The folks "incharge" destroyed America plain and simple, and I think that was their plan all along.
Summary: the SEC is going to make more rule changes that are highly favorable to industry insiders and bring no benefit whatsoever to individual investors. In the case of Reg. FD, industry insiders will benefit at a cost (harm) to individual investors. Perhaps by orders of magnitude.
This is the change you voted for. This is the government you deserve. I don't care how much proprietary software you've developed; how many newsletters you subscribe to; how many models you backtest; or how great an education you've acquired: there is no level playing field left in equity markets. Money is made because of some type of non-public advantage. The SEC is complicit in institutionalizing advantages to some players.
On the bright side, this will help us to fail faster. The slow-motion train wreck of debt deflation can be helped along by kleptocratic government/corporate incestuous relationships, and the SEC is Wall Street's favorite $20 whore.
What? Project Mayhem started?!?
Ok the SEC is corrupt.
So is Congress, so is this Prez and the one before.
Give me ideas on how to stop it?
You cannot get elected without selling your soul it seems.
You will not have to stop it. OUS will simply stop investing in the fraud that is "the Market" and then it will be like watching the bathwater going down the plughole.
The American People need the John McClane of market regulators but all we have is
Chief Wiggum.
TD--you got it wrong again. The amount of revenues collected by 31 fees is set by statutue. Fixed in law. However, the SEC self funding proposal could present the conflict you suggest. See below:
FY 2010 Section 31 Fee and Fee Adjustment Process
The SEC announced on April 30, 2009, that the new adjusted Section 31 fee rate would be $12.70 per million for fiscal year 2010, reducing the fees by more than 50% from the current $25.70 per million level. However, since the Fee Relief Act specifies that the annual fee adjustment cannot take effect until 30 days after the SEC’s “regular appropriation” is enacted, the new reduced Section 31 fee for fiscal year 2010 has not yet taken effect. The SEC has been operating under a Continuing Resolution (CR) to cover funding of the agency through December 18, 2009. A CR is not considered a “regular appropriation,” so the current fee of $25.70 per million remains in effect until 30 days after the SEC’s fiscal year 2010 “regular appropriation.” But with the President’s signing of the “Consolidated Appropriations Act, 2010” (H.R. 3288) containing (and thus enacting) the 2010 appropriations for the SEC on December 16, 2009, the new $12.70 per million rate will go into effect on January 15, 2010 (approximately 30 days from this December 16 signing). Furthermore, the Commission will announce the new fee rates for fiscal year 2011 no later than April 30, 2010, which will become effective October 1, 2010, or after the Commission’s fiscal year 2011 appropriation is enacted, whichever is later.
The Fee Relief Act also provides a “mid-year adjustment” (Section 31(j)(2) of the Securities Exchange Act), which requires the SEC to determine (based upon estimates of aggregate dollar volume of sales) whether the baseline estimate for that particular fiscal year is reasonably likely to be at least 10% greater (or less) than the actual aggregate dollar amount. If the SEC so determines, it will announce the adjustment of the Section 31 fee rate by March 1 (effective date on April 1).
The Fee Relief Act established a process for the SEC to adjust the Section 31 fee rate (annual as well as mid-year adjustments) to meet a target amount of funding set forth in the Act. The Act requires the SEC to adjust such rate changes for the beginning of each fiscal year (announced in late April and implemented on October 1, or thirty days after the enactment of that year’s SEC appropriations bill) with semi-annual adjustments, if necessary (announced on March 1, and implemented on April 1, of each year). The adjustments are made using an historical rolling average of market data.
More specifically, the SEC, in consultation with the OMB and the CBO, is to adjust the Section 31 fee rate to a level that, when applied to a baseline estimate of the aggregate dollar amount of sales for the fiscal year, would likely produce the aggregate fee collections equal to the target offsetting collection amount for that particular fiscal year. The target offsetting collection amount for fiscal year 2010 that the Fee Relief Act established is $1.161 billion. Based upon the estimates, the SEC announced on April 30, 2009, that the new adjusted Section 31 rate would be $12.70 per million, reducing the fees by more than 50% from the current $25.70 per million level. Historical levels of section 31 fee rates are listed in Table 1 below.
Table 1
Historical Levels of Section 31 Fee Rates
Section 31 Rate Before Passage of PL 107-123
$33.33 per million
December 28, 2001 to March 31, 2002
$15.00 per million
April 1, 2002 to March 21, 2003
$30.10 per million
March 22, 2003 to March 31, 2003
$25.20 per million
April 1, 2003 to February 21, 2004
$46.80 per million*
February 22, 2004 to March 31, 2004
$39.00 per million
April 1, 2004 to January 6, 2005
$23.40 per million
January 7, 2005 to March 31, 2005
$32.90 per million
April 1, 2005 to December 21, 2005
$41.80 per million
December 22, 2005 to March 16, 2007
$30.70 per million
March 17, 2007 to January 24, 2008
$15.30 per million
January 25, 2008 to March 31, 2008
$11.00 per million
April 1, 2008 to April 9, 2009
$5.60 per million
April 10, 2009 to January 14, 2010
$25.70 per million (current rate)
January 15, 2010 (30 Days After Enactment of FY 2010 Appropriation)
$12.70 per million
* The dramatic upward adjustment was a consequence of the decline in dollar volume of securities transactions in early fiscal year 2003 compared to Congressional Budget Office projections.
Target Offsetting Collection Amounts
The target offsetting collection amounts for fiscal years 2002 through 2011 (illustrated in Table 2 and Chart 1, below) are specified in the Fee Relief Act. Chart 2 illustrates a comparison between the SEC budget and the total Section 6(b) and Section 31 fees. Note that the total offsetting collection amounts for the combined Section 6(b) and 31 fees (not including the Section 13(e) and Section 14(g) fees) surpass that of the SEC’s budget. Also note that the offsetting collections are fees that the appropriators have access to above and beyond their allocations.
Table 2
Target Offsetting Collection Amounts (in millions)
Fiscal Year
SECTION 31 FEES
SECTION 6(b) FEES
TOTAL SECTION 6(b) and 31 FEES*
SEC Budget (in millions)**
2002
$ 732
$ 377
$ 1,109
$ 489
2003
$ 849
$ 435
$ 1,284
$ 620
2004
$ 1,028
$ 467
$ 1,495
$ 755
2005
$ 1,220
$ 570
$ 1,790
$ 887
2006
$ 1,435
$ 689
$ 2,124
$ 889
2007
$ 881
$ 214
$ 1,095
$ 875
2008
$ 892
$ 234
$ 1,126
$ 906
2009
$ 1,023
$ 284
$ 1,307
$ 960
2010
$ 1,161
$ 334
$ 1,495
$ 1,026
2011
$ 1,321
$ 394
$ 1,715
* The total amount does not include Section 13(e) fees for stock repurchase statements and Section 14(g) fees for proxy solicitation and statements in corporate control transactions.
** FY 2010 Budget is estimated, FY 2009 SEC Budget as enacted
Prospects for Increased Fees
Currently, regulatory reform legislation recently approved by the House of Representatives and being considered in the Senate includes provisions relating to funding for the SEC. Though the legislation in both the House and Senate are different, they both would allow the SEC to retain the fees collected from the industry (e.g., Section 31 fees). The bill approved by the House, the “Wall Street Reform and Consumer Protection Act of 2009” (H.R. 4173), contains a section entitled “The Investor Protection Act” (Title V, Subtitle C), which would allow the SEC to double its budget over a five year period. Senate Banking Committee Chairman Christopher Dodd’s “Restoring American Financial Stability Act of 2009” would retain the Section 31 transaction fee collection but would grant the SEC Chairman with authority to set the SEC’s budget and assess fees based upon that budget submission.
In particular, the Senate legislation would allow the SEC Chairman to submit a budget to the Congress, eliminating the appropriations process. The Commission would adjust transaction fee assessments to a rate that is estimated to equal the budget submitted, plus amounts necessary to maintain a reserve. If excess funds are collected above a certain threshold (25% above the budget), then the funds are to be “credited” to the Treasury as general revenue. So it is conceivable that the SEC Chairman could raise fees on the industry that, once collected, could be then transferred to Treasury to be used as general revenue to pay down the costs of any spending programs.
Regardless, under the current legislation being considered in the House and Senate, the industry is likely to face the prospect of increased fees assessed to meet the increased budgetary needs of the SEC.
Hopes this helps--
Zippy, it seems to me we had a very similar conversation on this same topic on the August post referenced above by Tyler, about when the SEC modified its rate UP in March. So then the problem was that the rate went up (supposedly proving that the SEC treats HFT as a cash cow and thus would not rein it in). Now the problem is a reduction in rates, seeming to favor said HFT operators? Just go back and read Tyler's post from 8/28 http://www.zerohedge.com/article/why-sec-irreperably-conflicted-issue-hi.... Split personality indeed. But hey, we knew that coming in, right...?
In any case what this tells me is that the SEC envisions a massive increase in dollar volume for 2010 (as the total fees to be collected are fixed in advance, right? and the per million fee rate just got halved, 2010 trading volume should be approx double that of 2009- minus the SEC's budgetary increase). Where is all this money coming from?
You missed the point entirely--the amount that is collected by 31 fees is Capped--fixed in law through 2012. Period, end of debate.
another post without a single coherent counter proposal in sight. time to start a blog lamenting about all the other blogs just wasting the internet.
Al Gore is still running free. FYI. He orchestrated the biggest scam of all time.
1) Fearmongering the world into believing "the end is near unless.. "
2) Creating a penance scheme that the Vatican couldn't have done any better
3) Demand the world pays for "hot air"
The scam would have almost worked and it may still be put forward. Whatever problems the stock markets have are nothing compared to this big scam that could potentially drain our blood.
I'm not even going to mention SS, Medicaid, Medicare and Health Care here...
Ladies and gentlemen, you are about to be parted from your money and there ain't absolutely nothing you can do about it.
WS and DC is for pirates who got seasick.
What does the SEC do when someone avoids filing Form 13D to hide their percentage ownership of a company and also fails to file Form 4 when they sell shares in said company?
If you ask John Winfield regarding his majority holdings in Goldspring (GSPG), they do absolutely nothing.
Hey SEC, can you spare an extra orange jumpsuit?
most likely cause he is not selling any stock and he does not own enough to file a form 13d
"What does the SEC do when someone avoids filing a Form 13D to hide their precentage ownership of a company and also fails to file a form 4 when they sell shares in said company"
NOTHING!!!!
Would you like a pony?
Very well put walkure.
The entire US government is a farce. We live in a government by farce -- a farcocracy.
You mean "Fartocracy"
(PFFFT) "BWAAAAAP!"
Love the smell of Methane in the morning
Wow my mind is blown.
'My morality is not your morality' is what I'm thinking, or something like 'I'm sorry, did I just break your concentration? You where saying something about...Best Intentions?"
But yeah...wow.
-MobBarles
Shapiro to investigate Cohen ??. Goyim truly are stupid sheep. That is not how we roll. Bernanke, Rahm, Summers, Shapiro, Bair, Blankfein etc...Jews run this country and the media.
I apologize for bring so crass, but are you all getting it yet ?.
All automated computer trading needs to be banned.
HFT with endless cash is nothing more than Deep Blue machines on crack.
Aside from stop losses/ execution prices it should be mandated that computer trades are illegal unless manually inputed. If we all played Chess for a living would it be fair to allow
the person with the most money to play Chess for him as a proxy while eliminating all emotional element from actions and consideration of exterior news driven events and common sense? It should be illegal. How much fun would it be to watch Cyborgs play baseball and football as opposed to athletes?
It would not be. No difference here.
also, robots making cars. we should all own aston martins instead of kias!
Yeh I agree ==I only trade via phone and telex..(LOL)
Maybe the SEC coming down on a big shot like Steve Cohen is the catalyst that is needed. Maybe someone like Cohen, that knows the business better than the SEC and is smarter and has resources to fight back. Maybe a leader will emerge. Maybe he will say f*ck you. Your coming after me Im coming after you.
it is interesting how only "junk" replies on this post are the 2 (thus far) which could be construed as critical of ZH in some way. does that mean this trade is about to reverse? i wonder if GS is yet selling CDS on ZH's demise LOL (i hope not - please don't junk me again!!!!)
Flyer,
Take it from a person who gets more junk tickets that anyone on this site. Just ignore it. 3500 people read the post and most likely 1200 read your comment.
It takes all kinds to make a site successful. This site has all kinds. Most likely the person was intending to mark my comment as junk and stuck yours by mistake.
My position is, if I don't piss someone off regularly, there is no need for me to be here.
Don't place the banks inside the oligarchy. Banks are a tool of the oligarchy. Government is a tool of the oligarchy.
As we sit and watch grandparents and parents fade into the sunset, the oligarchy is developing plans to make sure that the offspring of these grandparents and parents, who were born after 1952, never get their hands on the massive wealth that is left behind by the last responsible generation.
The oligarchy has stolen a substantial amount via Enron, AIG, and Goldman Sacks. But there is a few trillion dollars still to be stolen because there are many left in the sensible generation who did not fall prey to the oligarchy in the last 9 years.
The only chance for the oligarchy to achieve its goal of stealing the wealth of the middle class from the people who did not earn the money is to control the government regulation of the tools designed to steal wealth- banks, stockbrokers, real estate brokers, news media, etc.
As we sit and stab at the dead horses named SEC, FDIC, FRB, etc., the oligarchy is patiently waiting for our mothers and fathers to die.
I realize that. But how does the oligarcy factor in the vast amount of information that's out there on the internet. This is a different time and age although peole who could be alot smarter given the access to education are chosing to be inundated with propaganda and media trash. On second thought, maybe the time and age are not any differnt.
This question is totally unrelated to the post, but I figured that you guys would give me the best answer available on the internet.
Why is it that charts like the ones at yahoo.finance are by default given to you in a logarithmic scale?
It to me suggests that logarithmic growth of prices is normal.
the difference between two log prices is the log return.
A straight line on a log chart is equivalent to prices compounding at a constant rate
Bravo!
I was surprised to see in a popular english Hong Kong newspaper today talk of financiers setting up means for locals to invest in the US and UK real estate markets (commercial RE in US) now that prices have pretty much bottomed out.
Well, our real estate is up >30% this year; Shenzhen's up 50%. Might as well plough the profits into the next hot sector.
Can you legalize fraud ---
Fraud From Wikipedia, the free encyclopedia Jump to: navigation, search Criminal law Part of the common law series Element (criminal law) Actus reus · Mens reaCausation · Concurrence Scope of Criminal Liability Complicity · Corporate · Vicarious Inchoate offenses Attempt · Conspiracy · Solicitation Offence against the person Assault · Battery
False imprisonment · Kidnapping
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Homicide Crimes
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Embezzlement · Extortion
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Obstruction · Perjury
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Perverting the course of justice Defenses to Liability Defense of: (Self · Property)
Consent · Diminished responsibility
Duress · Entrapment · Ignorantia juris non excusat
Infancy · Insanity · Intoxication defense
Justification · Mistake (Law)
Necessity · Provocation Other common law areas Contracts · Evidence · Property
Torts · Wills, trusts and estates Portals Criminal justice · Law v • d • e Tort law Part of the common law series Intentional torts Assault · Battery
False imprisonment
Intentional infliction of
emotional distress (IIED) Property torts Trespass (land · chattels)
Conversion
Detinue · Replevin · Trover Defenses Consent · Necessity
Defense of self · of others · of property Negligence Duty of care · Standard of care
Proximate cause · Res ipsa loquitur
Calculus of negligence
Rescue doctrine · Duty to rescue Specific types
Negligent infliction of
emotional distress (NIED)
Employment-related · Entrustment
Malpractice (legal · medical) Liability torts Product liability
Ultrahazardous activity Nuisance Public nuisance
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False light · Breach of confidence
Abuse of process
Malicious prosecution
Alienation of affections · Seduction Economic torts Fraud · Tortious interference
Conspiracy · Restraint of trade Liability, defences, remedies Comparative / contributory negligence
Last clear chance · Eggshell skull
Vicarious liability · Volenti non fit injuria
Ex turpi causa non oritur actio
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In the broadest sense, a fraud is an intentional deception made for personal gain or to damage another individual. The specific legal definition varies by legal jurisdiction. Fraud is a crime, and is also a civil law violation
The SEC should then add this disclosure warning to all WKSI offerings: "Over-management of issuance may result in over-mismanagement of liquidation".
I'm a bit confused. What is the origin of your belief that HFT is rampant and blatantly speculative?
Who is "screaming" that the SEC "needs to do something"?
Does it cause systemic problems? Spreads are pretty thin, even with the GETCOs of the world trying to scalp out fractions of pennies. Is there evidence of harm cause by HFT? Or do you just have a gut feeling that it must be wrong, sort of like neo-classical macro?
Amen brother.
I wouldn't consider the execution of a trading program to be speculative, especially when used in combination with unlimited liquidity . The term "speculative" implies the possibility of an unexpected result.
HFT is not to blame for existing systemic problems but is rather the result... But this subtlety still does not legitimize it. Regardless, the benefit of HFT is absolutely one-sided. Are you saying that HFT in some way helps to maintain fair & equitable markets for all participants ? Please explain your logic.
When tradebot became the majority trader on the exchange, it was confirmed that HFT is nothing more than another tool to manipulate the market. The scale of the crime is irrelevant. Whether the thief intends to steal the silver dinnerware or steal at the rate of ~5cents per share per trade, it is still theft. The main difference being that at least one might have legal opportunity to shoot the thief in the act of grabbing one's silver, whereas currently there is no legal opportunity to exact the same manner of justice on the perps of HFT.
SEC busted two for insider trading in the Chattem buyout.
[Here's what's on the informative web! Jack]
FAMOUS RAPTURE WATCHERS - Addendum
by Dave MacPherson
(The statements in my "Famous Rapture Watchers" web article appeared in my 1983 book "The Great Rapture Hoax" and quoted only past leaders. The following names include other leaders who were quoted in that original printing.)
Oswald J. Smith: "...I am absolutely convinced that there will be no rapture before the Tribulation, but that the Church will undoubtedly be called upon to face the Antichrist..." (Tribulation or Rapture - Which?, p. 2).
Paul B. Smith: "You are perfectly free to quote me as believing rather emphatically in the post-tribulation teaching of the Bible" (letter dated June 9, 1976).
S. I. McMillen: "...Christians will suffer in the Great Tribulation" (Discern These Times, p. 55).
Norman F. Douty: "...all of the evidence of history runs one way - in favor of Post-tribulationism" (Has Christ's Return Two Stages?, p. 113).
Leonard Ravenhill: "There is a cowardly Christianity which...still comforts its fainting heart with the hope that there will be a rapture - perhaps today - to catch us away from coming tribulation" (Sodom Had No Bible, p. 94).
William Hendriksen: "...the one and only second coming of Christ to judgment" (Israel in Prophecy, p. 29).
Loraine Boettner: "Hence we conclude that nowhere in Scripture does it teach a secret or pre-tribulation Rapture" (The Millennium, p. 168).
J. Sidlow Baxter: "...believers of the last days (there is only one small part of the total Church on earth at any given moment) will be on earth during the so-called 'Great Tribulation' " (Explore the Book, Vol. 6, p. 345).
Merrill C. Tenney: "There is no convincing reason why the seer's being 'in the Spirit' and being called into heaven [Revelation 4:1-2] typifies the rapture of the church..." (Interpreting Revelation, p. 141).
James R. Graham: "...there is not a line of the N.T. that declares a pre-tribulation rapture, so its advocates are compelled to read it into certain indeterminate texts..." (Watchman, What of the Night?, p. 79).
Ralph Earle: "The teaching of a pre-tribulation rapture seems first to have been emphasized widely about 100 years ago by John Darby of the Plymouth Brethren" (Behold, I Come, p. 74).
Clarence B. Bass: "...I most strongly believe dispensationalism to be a departure from the historic faith..." (Backgrounds to Dispensationalism, p. 155).
William C. Thomas: "The return of Jesus Christ, described by parousia, revelation, and epiphany, is one single, glorious, triumphant event for which we all wait with great eagerness!" (The Blessed Hope in the Thessalonian Epistles of Paul, p. 42).
Harold J. Ockenga: "No exegetical justification exists for the arbitrary separation of the 'coming of Christ' and the 'day of the Lord.' It is one 'day of the Lord Jesus Christ' " (Christian Life, February, 1955).
Duane Edward Spencer: "Paul makes it very clear that the Church will pass through the Great Tribulation" ("Rapture-Tribulation" cassette).
J. C. Maris: "Nowhere the Bible teaches that the Church of Jesus Christ is heading for world dominion. On the contrary - there will be no place for her, save in 'the wilderness,' where God will take care of her (Rev. 12:13-17)" (I.C.C.C. leaflet "The Danger of the Ecumenical Movement," p. 2).
F. F. Bruce: "To meet the Lord [I Thessalonians 4:17]...on the final stage of...[Christ's] journey...to the earth..." (New Bible Commentary: Revised, p. 1159).
G. Christian Weiss: "Some people say that this ['gospel of the kingdom' in Matthew 24:14] is not the gospel of grace but is a special aspect of the gospel to be preached some time in the future. But there is nothing in the context to indicate this" ("Back to the Bible" broadcast, February 9, 1976).
Pat Brooks: "Soon we, in the Body of Christ, will be confronted by millions of people disillusioned by such false teaching [Pre-Tribism]" (Hear, O Israel, p. 186).
Herman Hoeksema: "...the time of Antichrist, when days so terrible are still to arrive for the church..." (Behold, He Cometh!, p. 131).
Ray Summers: "Because they [Philadelphia] have been faithful, he promises his sustaining grace in the tribulation..." (Worthy Is the Lamb, p. 123).
George E. Ladd: "[Pretribulationism] may be guilty of the positive danger of leaving the Church unprepared for tribulation when Antichrist appears..." (The Blessed Hope, p. 164).
Peter Beyerhaus: "The Christian Church on earth [will face] the final, almost superhuman test of being confronted with the apocalyptical temptation by Antichrist" (Christianity Today, April 13, 1973).
Leon Morris: "The early Christians...looked for the Christ to come as Judge" (Apocalyptic, p. 84).
Dale Moody: "There is not a passage in the New Testament to support Scofield. The call to John to 'come up hither' has reference to mystical ecstasy, not to a pretribulation rapture" (Spirit of the Living God, p. 203).
John R. W. Stott: "He would not spare them from the suffering [Revelation 3:10]; but He would uphold them in it" (What Christ Thinks of the Church, p. 104).
G. R. Beasley-Murray: "...the woman, i.e., the Church...flees for refuge into the wilderness [Revelation 12:14]..." (The New Bible Commentary, p. 1184).
Bernard L. Ramm: "...as the Church moves to meet her Lord at the parousia world history is also moving to meet its Judge at the same parousia" (Leo Eddleman's Last Things, p. 41).
J. Barton Payne: "...the twentieth century has indeed witnessed a progressively rising revolt against pre-tribulationism" (The Imminent Appearing of Christ, p. 38).
Robert H. Gundry: "Divine wrath does not blanket the entire seventieth week...but concentrates at the close" (The Church and the Tribulation, p. 63).
C. S. Lovett: "Frankly I favor a post-trib rapture...I no longer teach Christians that they will NOT have to go through the tribulation" (PC, January, 1974).
Walter R. Martin: "Walter Martin finally said...'Yes, I'm a post-trib' " (Lovett's PC, December, 1976).
Jay Adams: "Today's trend is...from pre- to posttribulationism" (The Time Is at Hand, p. 2).
Jim McKeever: "Nowhere do the Scriptures say that the Rapture will precede the Tribulation" (Christians Will Go Through the Tribulation, p. 55).
Arthur Katz: "I think it fair to tell you that I do not subscribe to the happy and convenient theology which says that God's people are going to be raptured and lifted up when a time of tribulation and trial comes" (Reality, p. 8).
Billy Graham: "Perhaps the Holy Spirit is getting His Church ready for a trial and tribulation such as the world has never known" (Sam Shoemaker's Under New Management, p. 72).
W. J. Grier: "The Scofield Bible makes a rather desperate effort...it tries to get in the 'rapture' of the saints before the appearing of Antichrist" (The Momentous Event, p. 58).
Pat Robertson: "Jesus Christ is going to come back to earth again to deliver Israel and at the same time to rapture His Church; it's going to be one moment, but it's going to be a glorious time" ("700 Club" telecast, May 14, 1975).
Ben Kinchlow: "Any wrath [during the Tribulation] that comes upon us - any difficulty - will not be induced by God, but it'll be like the people are saying, 'The cause of our problems are those Christians in our midst; we need to get rid of them' " ("700 Club" telecast, August 28, 1979).
Daniel P. Fuller: "It is thus concluded that Dispensationalism fails to pass the test of an adequate system of Biblical Interpretation" (The Hermeneutics of Dispensationalism, p. 369).
Corrie ten Boom: "The Bible prophesies that the time will come when we cannot buy or sell, unless we bear the sign of the Antichrist..." (Tramp for the Lord, p. 187).
Francis Nigel Lee (eleven earned doctorates!): "Dave MacPherson, in his various books, has made a major contribution toward vindicating Historic Christian Eschatology. The 1830 innovations of the disturbed Margaret Macdonald documented by MacPherson - in part or in whole - immediately spread to Edward Irving and his followers, then to J. N. Darby and Plymouth Brethrenism, and were later popularized by the dispensationalistic Scofield Reference Bible, by Classic Pentecostalism, and by latter-day pretribulationists like J. F. Walvoord and Hal Lindsey."
[In light of II Tim. 3:14 which says that we can't know too much about Bible teachers (Dave MacVersion), I invite you to read my article "Pretrib Rapture Dishonesty" which can be found on the "Powered by Christ Ministries" site.
It is time someone takes the SEC minions to court and prove their thievery:
Dear CMKX Plaintiffs:
I know that many of you are anxious to have an opportunity to share what I have requested you to keep confidential, for the purpose of discussion with others and as a means of helping to solidify the shareholder base. I have prepared an update, which follows, that I am now prepared to have released to the various shareholder discussion forums, should one or more of you so desire. If you do decide to post this, please include the entire ‘Update.’
CMKX Litigation Update
This office represents seven of CMKX’s larger shareholders who collectively hold more than 3.5 Billion shares. We have prepared a Bivens based class action lawsuit seeking release of all the funds that have been collected for the benefit of CMKX shareholders, or for damages in an amount in excess of $3,780,000,000,000. This suit alleges that the SEC commissioners have violated the Fifth Amendment Constitutional property rights of the shareholders by withholding consent to the release of such funds, for years, which amounts to a taking without due process of law. Some of the specific allegations made in the complaint include:
From March 17, 2005 through April 29, 2005 CMKM traded publicly, in the US under the trading symbol “CMKX,” a total of 551,756,751,833 shares, an average share volume of more than 17 billion shares per day, reaching a maximum on April 21, 2005 of 94,654,588,201 shares. These figures do not include foreign trades nor trades made on an ex-clearing basis such as those disclosed by Jefferies & Company , Inc. on May 6, 2005: between March 25, 2004 and September 21, 2004 Jefferies traded 111,780,681,204 shares of CMKX stock on an ex-clearing basis.
During the period of June 1, 2004 through October 28, 2005 a total of 2.25 Trillion “phantom” shares of CMKM Diamonds Inc, was sold into the public market through legitimate brokers, illegitimate brokers and dealers, market makers, hedge funds, ex-clearing transactions and private transactions. The sales of the majority of such shares were at all times known to the Securities and Exchange Commission, including Defendants herein.
At some date prior to June 1, 2004 the Securities and Exchange Commission in concert with the Department of Justice of the United States, together combined with Robert A. Maheu and others to utilize CMKM Diamonds, Inc. for the purpose of trapping a number of widely disbursed entities and persons who were believed to be engaged in naked short selling of CMKM Diamonds Inc. stock and cellar boxing the company. The Securities and Exchange Commission and the Department of Justice, with assistance from the Department of Homeland Security, believed and developed evidence that said short sellers were utilizing their activities to illegally launder moneys, wrongfully export moneys, avoid payment of taxes, and to support foreign terrorist operations. To fulfill the plan to criminally trap such wrongdoers, the Securities and Exchange Commission, with assistance from the Departments of Justice and Homeland Security:
a) Assisted in and approved the retention of Roger Glenn, an ex-SEC trial attorney and drafter of Sarbanes-Oxley, to join CMKM Diamonds Inc. for the purpose of verifying claims value, increasing authorized shares of stock to 800,000,000,000, and supervising from the inside of the company;
b) Encouraged the company to expand its promotional activities, assisted in the set up of the “racing activities” of the company, and underwrote a substantial portion of the cost of such activities;
c) Consented to, facilitated, and supported the sale of certain company claims to several foreign corporations;
d) Consented to, facilitated, and supported the conferences between Robert A. Maheu and his associate/assistant Royal Canadian Mounted Police Inspector William Majcher on the one hand, and the wrongdoing short sellers on the other, all for the purpose of settling the potential liability of said wrongdoers with consent of the U. S. Government and a representation of no criminal prosecution for such illegal sales;
e) Consented to, facilitated, and supported the declaration of dividends payable by the company to each common shareholder of CMKM Diamonds, Inc.
f) Consented to, facilitated, and supported the distribution of shares of CIM, a private company owned by Urban Casavant, as a stock dividend, including consent and approval of distribution of said shares to holders of more than 1.4 Trillion shares of CMKM Diamonds, Inc. common stock.
g) During the period from November, 2004 through April, 2005, CMKM Diamonds, Inc. negotiated the sale of some of its Saskatchewan, Canada mineral claims to three Chinese domiciled corporations with the advice and consent, inter alia, of the Securities and Exchange Commission. Proceeds from the consummation of such sales were placed into a frozen trust for disbursal at a later time.
During the period from March, 2004 through August, 2006, on behalf of CMKM Diamonds, Inc. Robert A.. Maheu, with assistance from Royal Canadian Mounted Police Inspector William Majcher, negotiated a settlement with the illegitimate brokers, dealers, market makers, hedge funds, and other persons and entities that had engaged in naked short selling of CMKM Diamonds Inc. stock and cellar boxing the company. In exchange for a U. S. Government promise of no prosecution for such sales, the wrongdoers each promised to pay negotiated amounts to a frozen trust for disbursal at a later time.
Plaintiffs herein are informed and believe, and based thereon allege, that other moneys have been collected for the benefit of the shareholders of CMKM Diamonds, Inc. from the Depository Trust & Clearing Corporation, from the United States Government, and from the sale of additional assets including consent to enter into joint venture agreements with other companies holding mineral claims in Saskatchewan, Canada. Plaintiffs herein are further informed and believe, and based thereon allege, that said moneys, collected for the benefit of shareholders have also been placed in a trust or are otherwise now held in trust by the Depository Trust & Clearing Corporation and the United States Treasury.
Plaintiffs herein are informed and believe, and based thereon allege, that at all times mentioned, the Securities and Exchange Commission reserved unto itself the sole and absolute discretion to determine when moneys collected pursuant to the scheme set forth above would and could be released for distribution.
Demand for release of said moneys has been repeatedly presented to the Securities and Exchange Commission without result. Agents and employees of the Securities and Exchange Commission and the Department of Justice have represented repeatedly that the release of moneys for distribution was imminent, and/or would occur within several weeks, and/or would occur within less than a month. Each of said representations have been made knowing them to be false, and at the specific direction of the named Defendants. These actions of withholding distribution of said moneys, without compensation and without due process of law, amount to a taking of the property of the individual Plaintiffs and of all similarly situated.
In an attempt to avoid protracted litigation we have seen to it that several attorneys at the SEC Office of General Counsel have a copy of the draft; we are further advised that the current SEC Commissioners are also aware [at least] of the pending filing. Our expectation was [and still partially remains] that the individually named Commissioners will not want to answer our lawsuit, thus leaving themselves open to the discovery process. The draft has been in SEC hands for approximately two weeks, and so far we have not received any response, meaningful or otherwise. They could well continue to stonewall, and force us to initiate the litigation. If nothing of significance occurs in the next two weeks the complaint will be filed on January 4, 2010.
HODGES AND ASSOCIATES