'Enact a market-wide mandatory pre-borrow requirement for all short sales'
writes Byrne
SALT LAKE CITY, Oct. 10 /PRNewswire-FirstCall/ -- Overstock.com, Inc.
(Nasdaq: OSTK) chairman and CEO Patrick M. Byrne sends an open letter to
President George W. Bush.
October 10, 2008
Mr. George W. Bush
President of the United States of America
1600 Pennsylvania Avenue
Washington, D.C. 20500
Dear President Bush,
I was pleased to hear you say today that the SEC is taking action to stop
manipulative practices in our markets. One such practice that the SEC must
stop immediately is the insidious practice of naked short selling. In order
for our stock settlement system to work so that trades actually settle, the
SEC (or Congress) must take the following steps:
1. Enact a market-wide mandatory pre-borrow requirement for all short
sales;
2. Put in place a market-wide hard-delivery requirement on T+3 for all
sales;
3. Require that for any failure-to-deliver, broker-dealers must force a
mandatory buy-in;
4. Track each trade cradle-to-grave, so that prosecutors can go after
naked short sellers;
5. Require regular and timely disclosure by naked short sellers of when
and how many shares they are failing to deliver; and
6. Enforce these rules, including significant monetary penalties and jail
time.
In addition, I believe that Washington must conduct a 9-11 Commission kind
of investigation into our nation's entire clearing and settlement system.
Naked short selling is a significant issue. It has contributed to the
recent fall of some of our financial institutions and exacerbated the current
market crisis.
A well functioning capital market should settle trades. Only when there
are laws in place that ensure settlement of all trades and when those laws are
vigorously enforced, will the scourge of manipulative naked short selling
stop.
Sincerely,
Patrick M. Byrne, PhD.
Chairman and Chief Executive Officer
cc: Senator Harry Reid, Senate Majority Leader
Senator Christopher J. Dodd, Chairman, Senate Banking, Housing, and
Urban Affairs Committee
Senator Richard Shelby, Ranking Member, Senate Banking, Housing, and
Urban Affairs Committee
Representative Nancy Pelosi, Speaker of the House of Representatives
Representative Barney Frank, Chairman, House Committee on Financial
Services
Representative Spencer Bachus, Ranking Member, House Committee on
Financial Services
Christopher Cox, Chairman, Securities and Exchange Commission
Kathleen L. Casey, Commissioner, Securities and Exchange Commission
Elisse B. Walter, Commissioner, Securities and Exchange Commission
Luis A. Aguilar, Commissioner, Securities and Exchange Commission
Troy A. Paredes, Commissioner, Securities and Exchange Commission
Eric R. Sirri, Director, Division of Trading and Markets, Securities
and Exchange Commission
Henry "Hank" M. Paulson, Jr., Secretary, Department of Treasury
About Overstock.com
Overstock.com, Inc. is an online retailer offering brand-name merchandise
at discount prices. The company offers its customers an opportunity to shop
for bargains conveniently, while offering its suppliers an alternative
inventory distribution channel. Overstock.com, headquartered in Salt Lake
City, is a publicly traded company listed on the NASDAQ Global Market System
and can be found online at http://www.overstock.com.
Overstock.com(R) is a registered trademark of Overstock.com, Inc. All
other trademarks are the property of their respective owners.
This press release contains certain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. Such forward-looking statements include, but
are not limited to, statements regarding whether the proposed solutions can
solve the current financial crisis or stop naked short selling. Our Form 10-K
for the year ended December 31, 2007, our subsequent quarterly reports on Form
10-Q, or any amendments thereto, and our other subsequent filings with the
Securities and Exchange Commission identify important factors that could cause
our actual results to differ materially from those contained in our
projections, estimates or forward-looking statements.
SOURCE Overstock.com, Inc.
media, Josh Austin, +1-801-947-4364, joaustin@overstock.com, or investors,
Kevin Moon, +1-801-947-3282, kmoon@overstock.com, both of Overstock.com, Inc.
