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stump1
Diamond Finder and Miner
Posts: 1,245
CMKM'S IMMENSELY VALUABLE 1.9 MILLION ACRES
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CMKM DIAMONDS INC. and NSS
1. ***FRACTIONAL U.S. STOCK CLEARING AND SETTLEMENT--WHICH INCLUDES THE DEPOSITORY TRUST CLEARING CORPORATION--SYSTEM ALLOWS HEDGE FUNDS TO ILLEGALLY NAKED SHORT OVER 2.4 TRILLION SHARES OF CMKM STOCK AND THEN CREATES IOU'S/COUNTERFEITED SHARES IN PLACE OF THE REAL CMKM SHARES
FACTS
In a normal legal settlement process, buyers buy shares of stock that sellers own at the time of the purchase.
In a normal legal setlement process, all shares of stock are held in the Depository Trust Company (DTC). When buyers buy shares of stock, their brokers' account ledgers are credited the exact number of shares of the purchase of the stock; likewise, when sellers sell stock, their brokers' account ledgers are debited the exact number of shares of the sale of the stock.
In a normal legal settlement process, all funds are held in the National System Clearing Corporation (NSCC). As soon as the buyers' funds are credited to the sellers' accounts, the NSCC alerts the DTC and the buyers' account ledgers are updated to show ownership of the stock.
Therefore those shares of stock actually exist.
In a legal short selling settlement process, buyers buy shares of stock that sellers do not own at the time of the purchase.
The sellers then borrow the shares from legitimate owners' brokers in the DTC and then use those shares to make good on their short sale when it comes time to credit shares to the buyers.
Therefore those shares of stock actually exist.
In an illegal naked short selling settlement process, buyers buy shares of stock that sellers do not own at the time of the purchase.
But this is where the illegal naked short selling process deviates from the legal short selling process. These sellers borrow no shares. In place of the shares, the U.S. Stock Clearing and Settlement System (System) creates IOUs, which in essence are illegal counterfeited shares, about which the buyers are never told. Therefore the buyers receive IOUs/counterfeited shares, in exchange for their real funds.
Under the Securities Act of 1933, publicly traded companies are the only entities that are authorized to issue stock. That Act preserves the integrity of the stock of the publicly traded companies and protects the rights of its shareholders to vote and to receive dividends.
When IOUs/counterfeited shares are allowed to trade alongside legitimately registered and issued shares, the normal operation of the markets is skewed because the natural relationship between supply and demand no longer exists.
Furthermore, the company that issues the legitimate stock is irrevocably harmed because that stock is its currency to be used for compensation, acquisitions, collateral for debt, capital raises, etc. When the price of a stock is depressed artificially due to IOUs/counterfeited shares increasing supply in the face of fixed or limited demand, the value of the company's stock (its currency) is depressed. That damages the company and its shareholders in precisely the same way as counterfeiting money harms the general populace.
Excerpts from Bill Frizzell's (BF) 9-30-05 email to Owners Group members:
"...We proved a huge naked short position in this company a long time ago...By my estimates there are at least a trillion and a half shares that have been sold in CMKX stock. When all shares (including foreign and obo accounts) are added to the mix, the total could exceed two trillion shares."
Have a good weekend.
Excerpts from BF's 5-31-06 letter to NASD:
"The Task Force has now received certs in the name of certain brokerage companies. Our investigation reveals a potentially huge naked short position in at least two of the very companies that have sent us certs.
"There was a time in the market place when shareholder’s rights at least co-existed with the rights of the broker/dealers. You have now been presented with evidence of shareholders who have demanded that their brokers issue certs for their holdings. Many shareholders have been flatly refused by their broker. This violates Nevada state law and the spirit, if not the letter, of federal regulatory law. I call on you to begin an investigation into this injustice."
Excerpt from Mark Faulk's (MF) 6-1-06 article, "The CMKX Story: When Too Much Isn’t Enough."
"In all reality, the brokers should have delivered the CMKX stock within three days after they made the sale, as required by law. Instead, the stock hasn’t even traded for the past seven months, and many of them still can’t deliver.
Even though there were a total of 703 billion shares of CMKX, and even though the stock hasn’t traded for almost seven months, brokers still haven’t been able to deliver stock to all of the shareholders who have requested it, pointing to a potential short that could total in the billions of shares.
"Considering the fact that the DTCC has claimed that the amount of failed deliveries has never exceeded 500 million shares for the entire market, it’s quite likely that the failed deliveries in this one little company....that no longer even trades....could surpass the entire number of fails claimed by the DTCC for the entire stock market."
2. ***NASD ALLOWS JEFFERIES AND COMPANY TO ILLEGALLY NAKED SHORT 111 BILLION SHARES OF CMKM STOCK
FACTS
2005
In the "Jefferies Letter," dated 5-6-05, Cathleen Shine, Deputy General Counsel for Jefferies and Company (Jefferies), responds to requests from Ms. Anne Dansard Glowacki, NASD, concerning Jefferies' failure to report certain trades in CMKM in 3-04.
According to the "Jeffferies Letter," the trades, amounting to 111 billion CMKM shares, involves "two broker dealer customers of Jefferies" who requested that trades in CMKM be settled "Ex-Clearing," which are trades that are cleared outside a clearing house and therefore are unreported.
That is tantamount to the "two broker dealer customers" requesting that Jefferies allow them to illegally naked short 111 billion CMKM shares.
According to the "Jeffferies Letter," Jefferies "made a business and operational risk decision to allow a limited number of broker dealer customers who were long sellers of CMKX to settle the trades "Ex-Clearing.""
That is tantamount to Jeffries confessing that it made "a business and operational risk decision to allow a limited number of broker dealer customers to" illegally naked short 111 billion CMKM shares.
Even after Jefferies confesses to violating the rules and fails to file appropriate Suspicious Activity Reports (SARS) against its "two broker dealer customers,", NASD does not deem it appropriate to file a complaint against it.
Instead, on 9-26-06, 1.5 years after the "Jefferies Letter" and 2.5 years after Jefferies fails to conduct adequate due diligence which is to file appropriate Suspicious Activity Reports (SARS) against its "two broker dealer customers," NASD deems it appropriate to charge a smaller securities firm, NevWest Securities Corporation of Las Vegas (NevWest) and two of its top officers--President Sergey Rumyantsev and Vice President Antony M. Santos--with violating NASD's Anti-Money Laundering Rule.
Furthermore, NevWest is not a self-clearing firm which means it has to clear its certs through clearing firms that have a contractual relationship with the Depository Trust Clearing Corporation (DTCC). Wells Fargo and Dain Rauscher are clearing firms for NevWest.
3. ***SEC ALLOWS CMKM FOUNDER, URBAN CASAVANT, AND CMKM INSIDERS TO ILLEGALLY ISSUE AND SELL 662 BILLION UNREGISTERED/RESTRICTED CMKM SHARES
FACTS
2003
From August 2003 to April 2005, the average trading volume in CMKM was about 20xs more than it was the previous eight months.
A fax dated 5-26-03, from Lindsey S. McCarthy (LSM), staff attorney for the Securities and Exchange Commission (SEC), to Transfer Agent, 1st Global Stock Transfer (1GST), that mentions James Kinney (JK), a Defendant in the subsequent Civil Action No. 08- CV 0437 of 4-7-08, Securities and Exchange Commission v. CMKM Diamonds, Inc., Urban Casavant, John Edwards, Ginger Gutierrez, James Kinney, Anthony Tomasso, Kathleen Tomasso, 1st Global Stock Transfer LLC, Helen Bagley, NevWest Securities Corporation, Daryl Anderson, Sergey Rumyantsev, Anthony Santos, and Brian Dvorak, United States District Court for the District of Nevada, proves that the SEC was aware of JK's suspicious activities pertaining to CMKM five years BEFORE filing said civil action against him.
The SEC fails to investigate the huge increase in volume in CMKM stock and fails to follow up on JK's suspicious activities.
4. ***THE MYSTERIOUS DISAPPEARANCE OF CMKM'S IMMENSELY VALUABLE 1.9 MILLION ACRES OF MINING CLAIMS IN THE FORT A LA CORNE AREA OF CENTRAL SASKATCHEWAN
FACTS
On 5-16-05, CMKM announces in a PR that it possesses the drilling report prepared by William Jarvis on the Fort a la Corne Diamond Project.
The drilling report was commissioned for CMKM by 101047025 Saskatchewan Ltd. Mr. Jarvis was asked to report on and make recommendations for the kimberlite exploration program. The scope of work completed includes:
1. a review of the Geological setting as it relates to kimberlite and diamond exploration;
2. an examination of the geological and data provided by the CMKM;
3. a review of published geological reports and maps;
4. a visit to the area of the concession.
The following are excerpts from Regional Triaxial Aeromagnetic Survey Assessment Work Report by N. Ralph Newson, William Jarvis on the Fort a la Corne Diamond Project:
"Drilling results and additional ground magnetic and gravity surveys have shown the best known kimberlite bodies to be bedded, and to have a very different shape from most known kimberlite bodies. In most of the well-known diamond mines in Africa, for example, and in those in the NWT in Canada, the upper portions of the kimberlites bodies have been eroded, leaving only the feeder pipe, which has a "carrot" shape, getting smaller in diameter with depth. However, in the Fort à la Corne swarm, the tops of the kimberlitic volcanic edifices are COMPLETELY PRESERVED [emphasis added by author], and they are shaped more or less like a soup bowl, with two larger horizontal dimensions, and one smaller vertical dimension. Several of these have an inferred geological resource (based on a few holes and on geophysical modeling) in excess of 100 million tonnes, one has nearly a billion tons, and one group of five which are close together, or perhaps coalescing, contain about 2 billion tons of kimberlite. There are thus HUGE VOLUMES OF KIMBERLINE WITHIN A FEW HUNDRED METRES OF THE SURFACE." [emphasis added by author]
"The Fort à la Corne swarm of kimberlitic bodies is the LARGEST SWARM KNOWN IN THE WORLD [emphasis added by author], and some of the bodies are the LARGEST KNOWN SUCH BODIES IN THE WORLD." [emphasis added by author]
Most CMKM investors predicated their investments in CMKM on the immensely valuable 1.9 million acres of mining claims.
The lawsuit that Entourage Mining Ltd. (Entourage) (OTCBB:ETGMF) filed in Canada against CMKM to force the return of its 45 million share cert apparently has a Resolution: CMKM will return the 45 million share Entourage cert to Entourage in exchange for Entourage's returning to CMKM its mining claims.
QUESTIONS
Are the mining claims that Entourage is returning to CMKM the same immensely valuable mining claims that were surveyed in the William Jarvis on the Fort a la Corne Diamond Project?
If so, why would the previous CMKM management exchange them for the 45 million share Entourage cert?
If so, why would Entourage return them to CMKM in exchange for the return of its 45 million share Entourage cert?
If not, where are those immensely valuable claims?
5. ***CMKM DIAMOND, INC., FOUNDER, URBAN CASAVANT, AND CMKM INSIDERS CHARGED WITH DEFRAUDING 50,000 CMKM SHAREHOLDERS OF OVER $250 MILLION DOLLARS
FACTS
2004 & 2005
CMKM Diamonds, Inc., (CMKM) generates investor interest with its GOT CMKX Race Car Promotion and CMKXtreme Race Car Promotion.
CMKM apparently hires Robert Maheu (RM), Donald Stoecklein (DS), and D. Roger Glenn (DRG) to give credibility to CMKM which in turn helps to generate investor interest.
2007
On 3-30-07, Bill Frizzell (BF) files a lawsuit, CMKM Diamonds, Inc., vs. Dave Demormeau, John Edwards, Case No. A538649, in District Court, Clark County, Nevada.
The lawsuit charges that Dave Desormeau's failure to keep records caused the SEC to delist CMKM. Moreover, the lawsuit charges that John Edwards (JE) was one of the insiders who, using various stock dilution techniques, inflated the outstanding shares of CMKM, unbeknown to CMKM shareholders, to over 700 billion shares.
On 4-25-07, BF files a 19-page lawsuit, CMKM Diamonds, Inc., vs. Urban Casavant et al, Case No. A540161, District Court, Clark County, Nevada.
The lawsuit charges Urban Casavant (UC) with seven charges including unjust enrichment and breach of fiduciary duty.
2008
On 4-7-08, the SEC files Civil Action No. 08- CV 0437, Securities and Exchange Commission v. CMKM Diamonds, Inc., Urban Casavant, John Edwards, Ginger Gutierrez, James Kinney, Anthony Tomasso, Kathleen Tomasso, 1st Global Stock Transfer LLC, Helen Bagley, NevWest Securities Corporation, Daryl Anderson, Sergey Rumyantsev, Anthony Santos, and Brian Dvorak, United States District Court for the District of Nevada.
The civil action charges the fourteen defendants with issuing and selling unregistered/restricted CMKM shares.
JE and a few other defendants have failed to answer said civil action and a default judgment has been entered.
The SEC fails to refer UC, JE, and the other defendants to the Department of Justice for criminal prosecution.
6. ***FORMER SEC ENFORCEMENT ATTORNEY, D. ROGER GLENN, ALLEGEDLY WRITES OPINION LETTERS FOR URBAN CASAVANT AND CMKM INSIDERS AND RAISES AUTHORIZED SHARES FROM 500 BILLION TO 800 BILLION.
FACTS
2004
CMKI kicks off its CMKXtreme Race Car Promotion to generate investor interest.
CMKM hires former SEC attorney, D. Roger Glenn (DRG), of the law firm, Edwards Angell Palmer & Dodge LLP, to represent it.
D.ROGER GLENN BACKGROUND
After college, D. Roger Glenn practiced as a Certified Public Accountant on the audit staff of Deloitte & Touche in Miami. He began his legal career with the Securities and Exchange Commission, where he conducted investigations for the enforcement division.
D. Roger Glenn has over 25 years of experience in securities law. He has handled numerous IPOs and other public offerings, PIPE transactions, exchange and hostile and friendly tender offers, mergers and acquisitions involving public and private companies, private placements, Rule 144A sales, Rule 10b5-1 plans and all filings and reports required by the Securities Exchange Act of 1934.
D. Roger Glenn has represented companies in the renewable energy, electricity regulation and storage, bio-composite materials, telecommunications, media, health care, financial services, technology and software industries with securities listed on the New York, American and Nasdaq stock exchanges.
D. Roger Glenn helped to write the Sarbanes-Oxley Act of 2002.
Until just recently, D. Roger Glenn was a partner in the firm, Edwards, Angell, Palmer, & Dodge, LLP.
END OF BACKGROUND
During his short tenure, CMKM's authorized shares increase from 500 billion to 800 billion and CMKM's outstanding shares increase to the current amount of over 700 billion.
Furthermore, according to a source, DRG writes opinion letters to enable UC and CMKM insiders to sell their unregistered/restricted shares.
CMKM apparently hires DRG to give credibility to CMKM which in turn helps to generate investor interest.
The SEC has failed to investigate the allegation that DRG wrote said opinion letters.
7. ***CMKM HIRES ROBERT MAHEU AND DONALD STOECKLEIN TO GIVE CREDIBILITY TO CMKM WHICH IN TURN HELPS TO GENERATE INVESTOR INTEREST
FACTS
2005
CMKM kicks off its GOT CMKX Race Car Promotion to generate investor interest.
CMKM hires Robert Maheu (RM) as CoChairman of CMKM.
ROBERT MAHEU BACKGROUND
Robert Maheu was an FBI agent from 1941 to 1947. He worked as a counter-intelligence officer in Europe during World War II. After leaving the FBI in 1947, he became a business owner, consultant and investigator. He was a consultant to and close confidant of Howard Hughes from 1955 to 1970.
Robert Maheu has also served as an advisor to Westinghouse, World Tankers Inc., Stavros Niarchos, Del E. Webb Corp., Schenley Distributors, United Steel Workers of America, Hughes Tool Co., Hughes Aircraft, Theta-Com of California, Howard R. Hughes, Leisure Industries Ltd., Jayhawk Industries, International Business Associates Inc., Shaheen Resources, MacMillian-Ring Free Oil Co., Pacific Investments, Expo-Tech, Exploration Co. of Louisiana, New Orleans Steamboat Co., Greyhound Exposition Services, Central Intelligence Agency, Global Intelligence Network, Las Vegas Investment Advisors Inc., Paradigm Gaming Systems, Konami Gaming Inc., Sunbelt Communications and Castle Rock Pictures Inc.
R Maheu's son, Peter, is an investigator for Global Intelligence Network.
Robert Maheu is deceased.
END OF BACKGROUND
Testifying at the subsequent SEC Administrative Hearing (Hearing), RM fails to answer one question that a COB of three months should know: he doesn't know if CMKM has any offices; he doesn't know how many employees CMKM has, how much they are paid, what kind of work that they do; he doesn't know how much CMKM has in the bank, its assets or liabilities.
Furthermore, RM neither knew what had been done with the $3-million allegedly received from U.S. Canadian Minerals, nor with the $5-million allegedly received from St. George Metals Inc.; nor did he know how CMKM shareholders or the investing public could find out what happened to that money.
At the conclusion of the Hearing, RM asserts that he can't set a date by which the required reports will be ready.
CMKM hires Donald Stoecklein (DS) of the Stoecklein Law Group (SLG), a firm specializing in securities matters, as new securities counsel to assist with the correction of past deficiencies and guide CMKM through its regulatory compliance.
DON STOECKLEIN BACKGROUND
Donald Stoecklein, is the managing director of Stoecklein Law Group and a Director and President of the Securities Law Institute.
Donald Stoecklein also owns Opus Pointe, which is an accounting and bookkeeping company and a division of the Securities Law Institute. Opus Point and the Securities Law Institute worked on CMKM matters.
Donald Stoecklein has extensive experience with representing micro-cap and small-cap publicly traded companies.
For over three decades, Donald Stoecklein has been active in all legal aspects of representing publicly traded companies, from assisting them with executing and developing their business plan to listing their securities on a national exchange. He plays a strategic role for clients by structuring registered equity and debt public offerings, PIPEs, equity lines, convertible debentures, venture capital and mezzanine financing.
Additionally, Donald Stoecklein oversees the preparation of registration statements with the SEC, preparation and filing of quarterly and annual reports with the SEC, along with handling board and stockholder meetings.
Securities Law Institute, provided information to Jonathan Katz, Secretary of the Security and Exchange Commission (SEC), on The Final Rule, which covers investor protection, naked shorting, shell company mergers and reporting.
END OF BACKGROUND
CMKM apparently hires RM and DS to give credibility to CMKM which in turn helps to generate investor interest.
8. ***HIGHER-UPS AT THE SEC APPARENTLY FORCE CMKM TASK FORCE TO DISBAND WHICH CAUSES PREMATURE STOPPAGE OF THE CERTIFICATE PULL
2005
FACTS
MIDDLE OF YEAR
CMKM announces in a Press Release (PR) that the SEC deems it in the public interest that an Administrative Hearing (Hearing) be instituted pursuant to Section 12(j) of the Securities and Exchange Act of 1934 (Act34) against CMKM to determine:
1. Whether CMKM is required to file with the SEC current and accurate information in periodic reports under Section 12(g) of the Act34;
2. Whether CMKM failed to comply with Section 13(a) of the Act34 and Rules 13a-1 and 13a-13 thereunder by failing to file required periodic reports.
In 1999, CMKM, then known as CyberMark, voluntarily registered its common stock under the Act34, Section(g). Pursuant to Section 12g-4 of the Act34, a company registered under 12g may terminate its registration requirements if the number of stockholders of record is reduced to less than 300. In July 2003, CMKM filed a Form 15 in an attempt to terminate its registration under the Act34. However, this filing contained an error in the stated number of record stockholders, which was discovered by CMKM's new securities counsel, DS, in February 2005.
CMKM announces in a PR that it considers the evidence of the illegal naked short sales (NSS) in its stock to be very relevant in its SEC Hearing. The Division of Enforcement of the SEC (SEC) contends that the illegal NSS is irrelevant and requests a ruling from Judge Murray in advance of the Hearing to prevent CMKM from discussing or providing any evidence of the illegal NSS that it has endured.
Predicated upon the pending Hearing, attorney/CMKM shareholder Bill Frizzell (BF) forms the Owners Group (OG) and offers to represent CMKM shareholders at the Hearing for $50 per shareholder.
From that initial solicitation, approximately 5,000 CMKM shareholders send BF their $50.
BF eventually solicits an additional $25 from each shareholder.
From that second solicitation, approximately 2,500 CMKM shareholders send BF their $25.
CMKM shareholders send BF a total of $312,500.
Prior to the Hearing, BF attends a meeting consisting of Andrew Petillion, (AP) Branch Chief of Enforcement at the Pacific Regional Office, SEC Enforcement Attorney, Leslie Hakala (LH), D. Roger Glenn (DRG), Robert Maheu (RM), and Donald Stoecklein (DS).
BF wonders why the Branch Chief was attending a meeting for a little diamond mining company.
At the meeting, BF is quoted: “Hakala and the SEC had the attitude of "why do the shareholders need a lawyer? Our job is to represent the investors. They don’t need their own council.""
According to BF, LH asks: "What proof do you have of naked shorting?"
BF answers: "Well, I have a CD and these are 5,050 brokerage statements that represent 350 billion shares. This has just come within the last five days. We also have a December 2004 report from the transfer agent saying that 2,033 people hold certificates representing 326 billion shares. That’s 676 billion shares owned by only 7,083 shareholders. Since there over 50,000 total shareholders total, it’s obvious that the ones that haven’t been counted yet will far surpass the 703 billion shares issued."
According to BF, LH asks: "well, how do I know that those brokerage statements haven’t been altered?"
BF answers: "Well, that can be verified through the brokerage house and we can get affidavits if we need to. But we’re here to tell you that this is our investigation."
According to BF, LH responds: "Well if you prove the naked short, we will investigate it."
BF responds: If there are brokers out there with shares in their accounts that they haven’t delivered, then it is what it is.”
AP informs BF that he views BF's attempt to provide at the pending Hearing evidence of the illegal NSS of CMKM stock as a short squeeze against the brokers and warns BF against doing a cert pull because that would be market manipulation.
Judge Murray subsequently rules that the Hearing involves only the very narrow questions of whether CMKM has violated federal securities laws by failing to file required reports and, if so, what sanctions are appropriate.
Recognizing the limited scope of the Hearing, Judge Murray rules that CMKM and the OG cannot make illegal NSS of CMKM stock an issue in the Hearing.
Judge Murray rules that the "Jefferies Letter" can be added it to the mountainous pile of documents presented on that day.
At the Hearing, Urban Casavant invokes his Fifth Amendment Right against self-incrimination and refuses to testify.
Testifying at the Hearing, RM fails to answer one question that a COB of three months should know: he doesn't know if CMKM has any offices; he doesn't know how many employees CMKM has, how much they are paid, what kind of work that they do; he doesn't know how much CMKM has in the bank, its assets or liabilities.
Furthermore, RM neither knew what had been done with the $3-million allegedly received from U.S. Canadian Minerals, nor with the $5-million allegedly received from St. George Metals Inc.; nor did he know how CMKM shareholders or the investing public could find out what happened to that money.
At the conclusion of the Hearing, RM asserts that he can't set a date by which the required reports will be ready.
END OF YEAR
CMKM announces in a PR that it withdraws its Administrative Appeal which effectively revokes CMKM's reporting status under Act34, as amended. As such, the SEC declares that it is currently unlawful for any broker dealer to effectuate a trade in CMKM's common stock.
Some speculate that CMKM has allowed itself to be revoked to lock in the naked short sellers so they can't cover. CMKM has over 703 billion outstanding shares (OS) and reportedly over 50 thousand shareholders.
RM resigns as CoChairman of CMKM but agrees to lend his assistance to CMKM and its shareholders as a consultant, trustee, or in any other capacity as needed during the winding up of CMKM’s affairs.
Despite AP's warning BF against doing a cert pull, CMKM creates a Task Force (TF) consisting of RM, DS, and BF to identify bona fide CMKM shareholders for the distribution of 50 million Entourage Mining Ltd. (Entourage) (ETGMF) shares to CMKM shareholders in exchange for Smeaton/Forte a la Corne mining claims.
To properly identify bona fide shareholders, the TF petitions CMKM shareholders to take physical possession of their CMKM shares by having them request that their brokers deliver their stock certificates (certs) to them.
CMKM shareholders comply with the TF's petition, and they request that their brokers deliver their certs to them.
The brokerages should have had no problem in delivering the certs to the CMKM shareholders, the rightful owners, within three days after they made the purchase as required by the T+3 Rule (investors must complete or settle their security transactions within three business days: trade date plus three days).
Instead the brokerage houses delay the delivery of the requested CMKM certs, and in some cases they fail to send the certs which results in massive failures to deliver (FTD).
According to Mark Faulk's 6-1-06 article, "The CMKX Story: When Too Much Isn’t Enough," The following are some of the excuses the brokerage houses gave to CMKM shareholders for their inability to deliver the certs to them as required by the T+3 Rule:
1. “We had your cert, but it is now lost. It will take us another 6 to 8 weeks to obtain another one.”
2. “This stock purchase was a book entry only and no certificate is available.”
3. “Your stock was classified as a worthless security and is no longer in your account.”
4. “Our clearing firm has not been able to deliver these certificates due to a backlog of requests at the transfer agency.”
5. “I have been instructed we are no longer pulling certs for CMKM and there is nothing I can do. You need to contact the company.”
By their failing to deliver to CMKM shareholders their shares of CMKM stock as required by the T+3 Rule, the brokerages are denying CMKM shareholders their right to ownership and have violated Nevada Revised Statute 78.235 which mandates: “..every stockholder is entitled to have a certificate, signed by officers or agents designated by the corporation for the purpose, certifying the number of shares owned by him in the corporation."
2006
BEGINNING OF YEAR
CMKM announces in a PR that as a result of a decrease in the number of Smeaton/Forte a la Corne mining claims in the original transaction, Entourage unilaterally subtracts 5 million shares from the 50 million shares in the original transaction thereby reducing the number of Entourage shares to be distributed to CMKM shareholders to 45 million.
CMKM shareholders who hold their shares in "street name" will need to demand physical certs from their brokers to be considered bona fide CMKM shareholders and be entitled to their proportionate share of the Entourage common stock and any other assets of CMKM to be distributed to bona fide stockholders.
CMKM shareholders will retain their CMKM shares upon completion of the verification process.
Each of the members of the TF has received subpoenas from the SEC to produce documents and appear for depositions.
Because a number of CMKM shareholders have indicated that they have still not received their certs from their brokers and the TF deems it imperative that it utilizes all reasonable efforts to notify CMKM stockholders and provide sufficient time for shareholders to obtain and communicate ownership of their certs, the TF is extending the deadline until 5 p.m. Pacific Standard Time on May 15, 2006, for the authentication of cert ownership.
CMKM hires John T. Moran III of Las Vegas, as its new corporate legal counsel.
MIDDLE OF YEAR
Shortly after being deposed by the SEC, the TF disbands without publicly announcing its findings or distributing the 45 million share Entourage cert to the CMKM shareholders.
Although the CMKM certificate pull stops prematurely, it still proves to be the biggest in the history of Wall Street.
The counter for the OS of CMKM stock stops prematurely at just over 703 billion.
The TF recommends that CMKM interplead the 45 million share Entourage cert in Federal Court.
9. ***SEC ENFORCEMENT DEPARTMENT ATTORNEY, LESLIE HAKALA, FAILS TO ACCOUNT FOR 362 BILLION UNREGISTERED/RESTRICTED SHARES IN CIVIL ACTION INVOLVING CMKM FOUNDER, URBAN CASAVANT, AND CMKM INSIDERS
FACTS
2008
On 4-7-08, the SEC files Civil Action No. 08- CV 0437, Securities and Exchange Commission v. CMKM Diamonds, Inc., Urban Casavant, John Edwards, Ginger Gutierrez, James Kinney, Anthony Tomasso, Kathleen Tomasso, 1st Global Stock Transfer LLC, Helen Bagley, NevWest Securities Corporation, Daryl Anderson, Sergey Rumyantsev, Anthony Santos, and Brian Dvorak, United States District Court for the District of Nevada, and charges the fourteen defendants with issuing and selling unregistered/restricted CMKM shares.
Because neither Urban Casavant (UC) nor the other defendants could possibly satisfy the Conditions of Rule 144 for issuing and selling restricted shares as provided by the SEC, they probably relied upon Section (f) of the Securities and Exchange Act of 1934, Rule 15c2-11, as the exemption for doing so.
SEC Enforcement Attorney, Leslie Hakala (LH), alleges in said civil action that from January 2003 to May 2005, CMKM improperly issues up to 622 billion purportedly registered/unrestricted CMKM shares.
From March 2003 through May 2005, using approximately 34 different brokerage accounts at NevWest Securities Corporation (NevWest), John Edwards (JE) sells almost 260 billion shares of the purportedly 622 billion registered/unrestricted CMKM shares.
That leaves approximately 362 billion purportedly registered/unrestricted CMKM shares that LH fails to account for in said civil action.
A source familiar with the civil action discloses that JE was the only defendant who utilized accounts at NevWest to sell his unregistered/restricted shares.
Furthermore, the source discloses that the other defendants used larger securities firms such as Knight Trading Group, Ameritrade, E*Trade, and Jeffries and Company to sell the 362 billion unregistered/restricted shares that LH fails to account for.
LH obviously can't account for those 362 billion purportedly registered/unrestricted CMKM shares without implicating the larger securities firms such as Knight Trading Group, Ameritrade, E*Trade, and Jeffries and Company.
Furthermore, NevWest is not a self-clearing firm. Instead, it must clear its certs through clearing firms such as Wells Fargo and Dain Rauscher that have a contractual relationship with DTC.
Although Brian Dvorak is the only attorney that the SEC mentions in the civil action as having written attorney opinion letters, the source discloses that he viewed attorney opinion letters pertaining to the issuing and selling of unregistered/restricted CMKM shares that were written by D. Roger Glenn, a former SEC attorney, and Sherwood N. Cook, a former Nevada Deputy Secretary of State for Securities.
See FORMER SEC ENFORCEMENT DEPARTMENT ATTORNEY for background of D. Roger Glenn.
SHERWOOD N. COOK BACKGROUND
Sherwood N. Cook is a partner in the Business & Commerical Law Department. His practice covers a wide variety of business related transaction and compliance areas of law, including business formation and planning, capital raising alternatives, succession planning, debt and equity securities offerings, and securities law compliance. From 1987-1990, Mr. Cook served as Nevada Deputy Secretary of State for Securities.
The source discloses that the SEC was notified about the suspicious activities regarding CMKM but failed to respond.
The SEC fails to refer any of the defendants to the Department of Justice for criminal prosecution.
10. ***ALL OF THE MEMBERS OF THE CURRENT CMKM MANAGEMENT WERE ADVOCATES FOR STOCK MARKET REFORM IN GENERAL AND CHAMPIONS FOR CMKM SHAREHOLDER RIGHTS IN PARTICULAR BEFORE THEIR STUNNING ABOUT-FACES
FACTS
2005
The attitude of BF BEFORE he represents CMKM shareholders at the SEC Administrative Hearing (Hearing) and BEFORE he becomes a member of the CMKM Task Force (TF):
Predicated upon a pending Hearing, attorney/CMKM shareholder Bill Frizzell (BF) forms the Owners Group (OG) and offers to represent CMKM shareholders at the Hearing for $50 per shareholder.
From that initial solicitation, approximately 5,000 CMKM shareholders send BF their $50.
BF eventually solicits an additional $25 from each shareholder.
From that second solicitation, approximately 2,500 CMKM shareholders send BF their $25.
CMKM shareholders send BF a total of $312,500.
2006
MIDDLE OF YEAR
The position of BF AFTER the Hearing and AFTER the CMKM TF disbands:
A shareholder/OG member requests an update from BF.
According to BF's curt reply:
1. "CMKM shareholders paid for the work "John Martin hired" him "to do."
2. "His work was completed per the agreement (Phase I and Phase II) when the company withdrew its appeal and the ruling of Judge Murray became final."
3. "The contributions--$312,500 total-- did not cover" his "out of pocket costs..."
BF neither gives the OG members an accounting of the $312,500 that he allegedly spent nor a final report of his findings.
The position of BF BEFORE he was hired to represent the current CMKM management:
Excerpts from BF's 9-30-05 email to Owners Group members:
"...We proved a huge naked short position in this company a long time ago...By my estimates there are at least a trillion and a half shares that have been sold in CMKX stock. When all shares (including foreign and obo accounts) are added to the mix, the total could exceed two trillion shares."
Have a good weekend.
Excerpts from BF's 5-31-06 letter to NASD:
"The Task Force has now received certs in the name of certain brokerage companies. Our investigation reveals a potentially huge naked short position in at least two of the very companies that have sent us certs.
"There was a time in the market place when shareholder’s rights at least co-existed with the rights of the broker/dealers. You have now been presented with evidence of shareholders who have demanded that their brokers issue certs for their holdings. Many shareholders have been flatly refused by their broker. This violates Nevada state law and the spirit, if not the letter, of federal regulatory law. I call on you to begin an investigation into this injustice."
The position of BF AFTER he was hired to represent the current CMKM management and the position of Kevin West (KW) AFTER he was appointed Chairman of the Board of CMKM:
FAQ #2 8-23-07
Question
"What is the status of Susanne Trimbath's evaluation of the Naked Short Position of the Company thus far?"
Answer
"Susanne Trimbath continues her work on our shareholder audit. The naked short situation and the delivery failures are not a primary concern of management at this time."
Mark Faulk's (MF) position BEFORE the current CMKM management came into existence:
Excerpt from MF's 6-1-06 article, "The CMKX Story: When Too Much Isn’t Enough."
"In all reality, the brokers should have delivered the CMKX stock within three days after they made the sale, as required by law. Instead, the stock hasn’t even traded for the past seven months, and many of them still can’t deliver.
Even though there were a total of 703 billion shares of CMKX, and even though the stock hasn’t traded for almost seven months, brokers still haven’t been able to deliver stock to all of the shareholders who have requested it, pointing to a potential short that could total in the billions of shares.
"Considering the fact that the DTCC has claimed that the amount of failed deliveries has never exceeded 500 million shares for the entire market, it’s quite likely that the failed deliveries in this one little company....that no longer even trades....could surpass the entire number of fails claimed by the DTCC for the entire stock market."
Mark Faulk's (MF) position AFTER the current CMKM management came into existence:
MF constantly disrespects and belittles CMKM shareholders on his show, "The Faulking Truth Show," on Toginet.com when they broached the subject of CMKM's being the victim of illegal NSS.
11. ***INSTEAD OF PUTTING OUT PROFESSIONAL PRESS RELEASES, CURRENT CMKM MANAGEMENT POSTS UNPROFESSIONAL CEO UPDATES AND FAQS ON ITS WEBSITE THAT ARE RIFE WITH CONTRADICTIONS, INCONSISTENCIES, AND DISCREPANCIES WHICH INDICATES THAT IT HAS AN AGENDA THAT IS NOT CONDUCIVE TO THE BENEFIT OF CMKM SHAREHOLDERS; AFTER FAILING TO TAKE ANY APPROPRIATE ACTION SINCE ITS INCEPTION, THE CURRENT CMKM MANAGEMENT TAKES FEEBLE ACTION ON THE VERY SAME DAY AS CMKM SHAREHOLDER'S POST
FACTS
From 5-07 to 6-08, the current CMKM management fails to put out a Press Release (PR).
From 6-08 to present (4-09), the current CMKM management fails to put out a PR.
On 2-4-09, a CMKM shareholder posts in the 1 MILLION MILLIONAIRES Forum, "Shareholders are united in Truth."
The following is part of said post:
"ACTIONS THE CURRENT CMKM MANAGEMENT SHOULD HAVE BEEN/SHOULD BE TAKING:
"1. Filing Complaints against the malfeasant trust funds that have illegally counterfeited CMKM shares with their massive Naked Short Selling (NSS);
"2. Filing Complaints against the malfeasant brokerage firms, market makers and banks that are guilty of complicity in the massive NSS of CMKM shares;
"3. Pressuring the various governmental and enforcement agencies to perform their prescribed functions;
"4. Filing Complaints against governmental and enforcement workers who fail to perform their prescribed functions;
"5. Placing display ads in the newspapers and uploading YouTube videos both of which will expose the corruption in government in general and our CMKM plight in particular;
"6. Attempting to obtain official confirmation on the compensation for the Shareholders;
"7. Working to get CMKM shareholders included in Barack Obama's 800 billion stimulus package;
"8. Working in collaboration with the Deep Capture Campaign and Patrick Byrne."
On 2-4-09, the very same day of said post, the current CMKM management takes the following feeble actions:
"CORPORATE UPDATES ON FEBRUARY 4TH, 2009 CMKM PETITIONS FEDERAL AGENCIES TO FILE CHARGES IN MAJOR STOCK MARKET SCANDAL AND TO: DOJ, FBI, AND IRS TASK FORCE INVESTIGATING CMKM DIAMONDS, INC. (CMKX): PETITION AND ITS CEO SHAREHOLDERS' CORNER UPDATE ON 2-8-09."
Most CMKM shareholders refuse to sign said petition and disregard the current CMKM management's sudden flurry of actions because:
1. After 2 years of failing to take the appropriate ACTIONS, the current CMKM management posts its said petition on the exact same day that a CMKM shareholder posts, "Shareholders united in Truth," which clearly indicates that it is only attempting to cover up its flagrant negligence and other possible offenses of the previous 2 years and therefore is NOT really sincere in fighting for CMKM shareholders;
2. The current CMKM management is flagrantly negligent for failing to mention in said petition the MAIN perpetrators that have victimized CMKM shareholders:
A. Hedge funds that have illegally counterfeited CMKM shares with their massive naked short sales (NSS);
B. Brokerage firms, market makers and banks that are guilty of complicity in the massive NSS of CMKM shares;
C. The fractional U.S. Stock Clearing and Settlement System--which includes the Depository Trust Clearing Corporation--that allows NSS;
3. The current CMKM management is flagrantly negligent in declaring in said petition that CMKM shareholders were defrauded out of "over $250 million" because that amount fails to take into consideration CMKM's illegal NSS status that denotes compensatory, punitive, and RICO damages.
4. A petition is in and of itself a feeble vehicle for fighting for CMKM shareholders;
5. The current CMKM management is flagrantly negligent for posting said petition on its website, instead of utilizing the standard legal procedures of mailing the petitions to ALL CMKM shareholders or of announcing said petition in an official PR.
6. The current CMKM management is flagrantly negligent for posting on its official CMKM website the names, cities, and states of the CMKM shareholders who have signed said petition thereby placing said CMKM shareholders at risk by giving a target list to the perpetrators when CMKM shareholders receive their fair and just compensation;
7. The current CMKM management is merely attempting to fix its irreparable relationships with CMKM shareholders;
8. The current CMKM management is merely attempting to align itself with and take credit for the ACTIONS taken by dynamic CMKM shareholders.
9. Most CMKM shareholders view the members of the current CMKM management as incompetent and therefore have NO faith in anything that they propose.
12. ***SEC FOIA DEPARTMENT UNJUSTLY DENIES FOIA REQUESTS SUBMITTED BY CMKM SHAREHOLDERS
2009
FACTS
BEGINNING OF YEAR
In March, in a concerted effort to discover the truth, CMKM shareholders submit FOIA Requests for depositions of D. Roger Glenn, Donald Stoecklein, Robert Maheu, and Bill Frizzell.
The SEC unjustly denies the FOIA Requests under 5 U.S.C. § 552(b)(7)(A):
Compiled for law enforcement purposes, the release of which could reasonably be expected to interfere with law enforcement proceedings.
The FOIA Requestors have filed Administrative Appeals.
noahltl1.proboards.com/index.cgi?board=cmkx1&action=display&thread=2347&page=2 There is some good info in here thanks Stump1 for the post...Flying Moose(cmkx-treme)