Updated 3/31/2008
Lowell posts:
Here’s our legal case for why the broker dealers violated a 2006 court order (from the SEC website):
“each Respondent shall, at or before the completion of the applicable transaction, provide all customers who are first-time purchasers, and all broker-dealers who are purchasers, of auction rate securities from the Respondent (“Purchasers”) with a written description of the Respondent’s material auction practices and procedures. A Respondent may fulfill the foregoing requirements to provide such written description to Holders and Purchasers by sending a written notification (e.g., via e-mail, subject to applicable legal requirements) or, with respect to Purchasers, by including a written notification with the trade confirmation, that a written description of the Respondent’s material auction practices and procedures is available on a specified web page of the Respondent’s website accessible to such Holders and Purchasers.”
Did anyone receive a written description?
http://www.sec.gov/litigation/admin/2006/33-8684.pdf
The Respondents include: Bear, Stearns & Co. Inc.; Citigroup Global Markets, Inc.; Goldman, Sachs & Co.; J.P. Morgan Securities, Inc.; Lehman Brothers Inc.; Merrill Lynch, Pierce, Fenner & Smith Incorporated; Morgan Stanley & Co. Incorporated and Morgan Stanley DW Inc.; RBC Dain Rauscher Inc.; Banc of America Securities LLC; A.G. Edwards & Sons, Inc.; Morgan Keegan & Company, Inc.; Piper Jaffray & Co.; SunTrust Capital Markets Inc.; and Wachovia Capital Markets, LLC
My Note: I, Serge Birbrair, didn't receive any disclosures! Did you!?
If you live in Florida:
Post by another fellow Floridian
I just emailed the SEC with my complaint. To all you out there reading thinking you are just one person, that you won't make a difference. Yes you can. They need to hear from us, so please write.
I'm a resident of Florida. I'm sending a letter to the Florida Attorney General.
http://myfloridalegal.com/contact
I also ran across another agency in Florida. The Florida Office of Financial Regulation, Securities Division.
http://www.flofr.com/Director/abouttheoffice.htm
I spoke to them this morning. Trust me, the dawn is only just beginning to break there in D.C about the enormity of what happened here. The SEC itself has actually have been misled by the poor press on this issue and have been under false impressions (basic disclosures was given, sophisticated investors "chose" these securities, only high net worth individuals & institutional investors were involved, etc.) The SEC is never going to understand the reality of this unless you tell them, and this is the time.
The address:
I am going to slightly revise my recommendations about what to tell them based on my conversation this morning. TELL THEM
1. What broker put you in this and when.
2. What you told that broker directly about your investment objectives were in opening the account (complete liquidity, low risk/low yield, etc.) Use specific words.
3. What percentage of your net worth this represented (for most of us, a lot!) and where your money came from (life savings over 20 years of work, sale of a hard earned business, money parked & saved for a house, money put aside for old age, small inheritance from a hardworking parent)
4. What those you-know-whats told you they were putting your liquidity in. N.B. This is important and even the press has it wrong!! Most of us were NOT told anything about "auction rate securities." The words were never used. Tell the SEC what words WERE used: floaters, 7 day CDs, 7 day paper, money market account, etc. Tell the SEC what words were NOT used. "Auction." "Dutch auction" "no duty to participate" "illiquidity" "auction failure. Use specific words.
5. What disclosures you were given either in writing or verbally. Did you get a prospectus? Have you NOW seen a prospectus now that it is too late? Were you advised of ANY risk to liquidity? Did anyone mention auction failure? Did anyone mention that the brokerage itself was keeping the auctions liquid? Did anyone happen to mention that the brokerage believed it had no obligation to you to continue to do so? If the answers to these questions are NO, as I know they are in, like, 100% of our cases, tell the SEC loud and clear.
6. Finally, when and how were you told that your "liquidity" was no longer liquid? Did your advisor call you to say auctions were failing? Was that the first time you had EVER heard of auctions? Was that the first time you had ever had your own brokerage was an inside player keeping this market liquid? Did your broker call you to advise that liquidity might fail on or about February 13? Use specific language. Blow. The. Whistle.
1. Legal. Keeping up with all the civil legal actions, both private arbitrations and more important the class actions, to make sure the right claims have been raised and the right defendants sued. This protects and preserves our rights to opt in or opt out of the class litigations or the settlements and tolls our statutes of limitation.
I am willing to take this one. In fact I am now considering being the temporary lead plaintiff in one of the CAs just so I CAN be inside and know exactly what is going on.
2. Media Publicity. I know I can't do it. Not my thing. Frank?
3. Lobbying Congress.
4. SEC Enforcement. I'd like to do this as I am pretty deep into it, unless someone else does.
5. Organizing ARPS holders' attendance at the issuers' shareholders meetings for direct address and protest--who wants to do this? It will involve a lot of research and scheduling and posting (this seems to be to be the best venue for protest--a picket line won't do it. You're a shareholder: put on a suit, and go in tell those commons this corporation defrauded you and is gonna be sued, not just for rescission but for all kinds of damages & how are they gonna like the value of their common then!)
6. Possible FBI/criminal investigation. RICO (the Racketeering & Corrupt Organizations Act) used to be the federal criminal statute most often used to prosecute grave securities fraud but I'm probably behind the times. Anyone want to take this one? Jorge?
I maintain this web page to gather as much information as possible and spread the word to help other victims of this financial misrepresentation and alleged crime by the major financial institutions.
I can be reached via e-mail at russkyserge@hotmail.com
Serge Birbrair and I am not just a web page publisher, but also a victim who trusted UBS and got burnt. Do YOU want to be next?
No? Don't believe everything you hear from your Financial Adviser, as they are played by the management too.
