Alternative New Media for the Gulf South
Hat tip to an unhappy investor. Click the picture for a pdf of the entire signed 3 page agreement and click below the fold for a hint as to our next international destination as Slabbed follows the girls and the money. Meantime let’s all ponder if Abel and the girls pulled a Bugsy Siegel. By my math 40 is the maximum number of 2.5% investors a company can have without being more than 100% owned.
Amazing what one can find buried in financial filings at the SEC website. This is from a stock in liquidation:
Kwaku O. Kushindana, having a mailing address of…….Baton Rouge, Louisiana……., owner of 10 shares of EDCI common stock, has notified EDCI that he intends to present the following proposal at the Annual Meeting. As required by SEC rules, the text of the proposal and supporting statement are included below exactly as submitted by the stockholder. EDCI is not responsible for the contents of the proposal or the supporting statement.
Stockholder Proposal
“Hereby, that Kwaku O. Kushindana of Louisiana be hired as an Independent Consultant (based from Louisiana) to insure the rights of disaffected concerns (i.e., small shareholders, small firms doing business with EDCI, women & minority owned firms, gay & lesbian entities, artists under the purview of Entertainment Distributions Company, Inc, small retail stores, etc).
Further, that named person receives a three year contract during the winding down period of EDCI which would include a salary, plus expenses to insure the fairness of this process to all disaffected concerns.”
(Disclosure: I am long this issue. Cavet emptor)
The above is an example shareholder exercising his right to petition the ownership with a proposal. In this instance it is of the completely self-serving variety. As such it represents fodder for big business shills like the folks over at the Competitive Enterprise Institute which is a front for Bermudian reinsurers and other business interests.
Along those lines and since a shareholder has the right to petition the ownership there is an entire class of investors known as activists shareholders who endeavor to change bad corporate governance from the inside out. And that brings us to the opposite, or forced change from the outside in, taking the form of shareholder derivative lawsuits. On Continue reading “Slicked and Slabbed, the Barbarians are at the gates: Slabbed peeks inside the world of shareholder derivative lawsuits as we take a closer look at Transocean and the disaster in the Gulf”
Thursday, August 19, 2009
Baton Rouge, Louisiana
STANFORD REGULATORY SCREW UPS MAY COST
LOUISIANA TAXPAYERS HUNDREDS OF MILLIONS
Hundreds of irate Sanford investors converged on Baton Rouge this week to protest their financial losses from what they charge was a giant Ponzi scheme by this international investment firm. Their wrath is directed both at the Stanford group for undertaking the massive financial fraud, and federal regulators, including the Securities and Exchange Commission, for not providing proper regulatory oversight. But a strong case can be made that there is major culpability on the part of a state agency, the Office of Financial Institutions. And we are talking about Louisiana taxpayers being potentially hit with a bill that could approach $850 million.
Here is the question that several lawyers representing Sanford victims will soon allege: Did Louisiana regulators allow the Stanford Group to set up a dubious, one-of-a-kind trust to handle vast investments, but then never bothered to properly monitor just what was being done with the money and whether Stanford were playing by the rules?
Everyone has heard of a “Bank and Trust”. Well there are also provisions under Louisiana law to form just a “Trust,” with no bank involved. And the law is quite specific as to what a Trust can and cannot do. Here is the exact wording: “A trust company does not have the power to solicit, receive, or accept money or its equivalent on deposit, or lend money, except in transactions reasonably related to and derived from its service as fiduciary.” Not one word there about selling CDs from Latin American banks. Continue reading “Jim Brown on the cost of regulatory capture: More shit for Louisiana taxpayers to shovel courtesy of the Office of Financial Institutions”
I’ve been too busy too keep up with the news but the spectacular implosion of the Madoff hedge fund caught my attention if only because it serves up another great example of regulators being asleep at the switch at the US Securities and Exchange Commission instead of protecting the investing public from fraudsters such as Bernard Madoff. From what I’ve read and heard Madoff’s so called investment bank was nothing more than ye ole Ponzi Scheme. Even better the toothless watchdogs at the SEC looked at Madoff multiple times and found nothing wrong.
I’ve written about the problems with regulatory capture many times here on slabbed, from our own Mississippi Insurance Commissioner Mike Chaney to big problems at the SEC involving John Mack, CEO of Morgan Stanley. The end result is never good for the public though Mr Mack’s $40 million dollar bonus must have been nice for him.
As for the group of very distinguished bagholders that resulted from Mr Madoff’s get rich quick Ponzi Scheme, they may just get a bailout according to this AP story carried by the Sun Herald.
A federal judge on Monday threw a lifesaver to investors who may have been duped in one of Wall Street’s biggest alleged frauds, saying they need the protection of a special government reserve fund set up to help investors at failed brokerage firms.
U.S. District Judge Louis L. Stanton ordered that clients of Bernard Madoff’s private investment business seek relief under a federal statute created to rescue cheated investors. Stanton also ordered that business be liquidated under the jurisdiction of a bankruptcy court and named attorney Irvin H. Picard as trustee to oversee that process. Continue reading “The End Result of Regulatory Capture: Madoff and Another Bailout”
