Posts Tagged ‘Wyly brothers’

Wily Wyly’s

Wily Wyly’s

Courtesy of Cassandra Does Tokyo 

Phineas Taylor Barnum (1810-1891) American showman; co-founder of Barnum and Bailey circus. Edward Linley Sambourne cartoon from Punch London 1884 in the Fancy Portraits series showing Barnum as a wily fox exploiting people's phrenological bump of Credulity. At this time Gall and Spurzheim's idea that physical formation of skull was related to mental capacity, Engraving

I used to smile sophmorically at the sight of a Dentist named Dr Fang, or a Plastic Surgery clinic named Dr Tuck, just as I have long-chuckled at the sight of the The Wyly Brothers moniker in print. Monday morning quarterbacking is always easy, but I can tell you that there was always something fishy about the way their stocks traded (both Sterling Software and Sterling Commerce) – and now, of course, we know why.

Wealthy self-made Texans (however grey their machinations), it seems, are inherently disdainful of regulation and authority, and a sucker for low-hanging fruit irrespective of prevailing law. But rather than being "men" about it (so to speak), and simply taking their operation private at an early stage, or checking out and becoming a citizen of Belize (like Tory Chair Michael Ashcroft or paper-cup scion Kenneth Dart) or creating their own island state with its own zero-tax and regulatory regime (like the Berkley Brothers),  the Wyly’s chose to speaketh in forked tongues, milking the system for its benefits, while systematically gaming it in reasonably cynical fashion. Even sadder, they authored a now-dubious book about their formula success – one which undoubtedly excluded a few ignoble "trucs de chef". The Wyly’s, it would seem, expected nothing more than proverbially "having their cake whilst eating it too" versus paying more than their share of tax, forgoing illegal trading gains, or limiting their presence in their beloved fire-ant state to 180 days per calendar year. 

There are lessons for the contrarian here, and ammunition for those trying to explain the price momentum phenomena: The Wyly brothers were not alone. I do not mean "alone" in the sense of being in the company of Mr Waksal or Mrs Stewart. Rather, I mean that their entourage, like the Remoras (or sucker fish) feeding upon their hosts errr umm crumbs, was omnipresent in riding the coat-tails of each abuse of material non-public information.  Indeed, the daisy-chain is unlikely to have stopped there. Humans DO learn quickly where the fish are hiding, and all manner of observant executing trader, back-office clerk, and/or personal assistant, will surely have suspected  the cause and effect of winning trades. Beyond that, information is power, and is often used to curry favor for those looking to reward or impress.

In short, it is a picture-postcard of inside information…
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SEC Brings GIGANTIC Insider Trading Case Against The Famous Wyly Brothers Of Texas

This post from Business Insider sets the stage for the next post by Cassandra Does Tokyo which discusses insider trading in general. – Ilene 

SEC Brings GIGANTIC Insider Trading Case Against The Famous Wyly Brothers Of Texas

wyly brothers

Image: www.charlesandsamwyly.com

Courtesy of Joe Weisenthal at Business Insider/Clusterstock 

This evening the SEC announced a massive fraud charge against Dallas-based investors The Wyly brothers.

As Paul Murphy at FT Alphaville notes, the charge — which pertains to activity taking place over 13 years, worth $550 million — makes Rajaratnam and Martha Stewart look like small potatoes.

The gist of the allegations: The brothers Wyly (Samuel and Charles J.) used their various board seats and a network of offshore accounts to trade and conceal their holdings.

Here’s the press release:

—--

The Securities and Exchange Commission today charged brothers Samuel E. Wyly and Charles J. Wyly, Jr. of Dallas with violating federal securities laws governing ownership and trading of securities by corporate insiders. The Wyly brothers reaped more than $550 million in undisclosed gains while sitting on corporate boards by trading stock in those public companies through hidden entities located in foreign jurisdictions to conceal their ownership and trading of those securities.

The SEC alleges that the brothers created an elaborate sham system of trusts and subsidiary companies in the Isle of Man and the Cayman Islands to sell more than $750 million worth of stock in four public companies for which they were corporate directors. They also committed an insider trading violation in one of the companies for an unlawful gain of more than $31.7 million.

Along with the Wylys, the SEC charged their attorney Michael C. French of Dallas and their stockbroker Louis J. Schaufele III of Dallas for their roles in the fraudulent scheme. French was on the board of directors at three of the companies.

"The cloak of secrecy has been lifted from the complex web of foreign structures used by the Wylys to evade the securities laws," said Lorin L. Reisner, Deputy Director of the SEC’s Division of Enforcement. "They used these structures to conceal hundreds of millions of dollars of gains in violation of the disclosure requirements for corporate insiders."

According to the SEC’s complaint, filed in U.S. District Court for the Southern District of New York, the public companies…
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Phil's Favorites

Might consciousness and free will be the aces up our sleeves when it comes to competing with robots?

 

Might consciousness and free will be the aces up our sleeves when it comes to competing with robots?

Our advantage lies in incommensurables, and it’ll grow in importance. Franck V. on Unsplash

Courtesy of Allan McCay, University of Sydney

The rise of artificial intelligence has led to widespread concern about the role of humans in the workplaces of the future.

Indeed, Israeli historian, futurist and publishing sensation Yuval Noah Harari warns in his most recent book 21 Lessons for the 21st Century that there might one day be little need for human...



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Digital Currencies

Blockchain voting is vulnerable to hackers, software glitches and bad ID photos - among other problems

 

Blockchain voting is vulnerable to hackers, software glitches and bad ID photos – among other problems

How secure is online voting with blockchain technology? WhiteDragon/Shutterstock.com

Courtesy of Nir Kshetri, University of North Carolina – Greensboro

A developing technology called “blockchain” has gotten attention from election officials, startups and even Democratic presidential candidate Andrew Yang as a ...



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Lee's Free Thinking

Repo Market Bank Regulations and the Slings And Arrows of Outrageous Leverage

 

Repo Market Bank Regulations and the Slings And Arrows of Outrageous Leverage

Courtesy of 

Are repo market regulations really behind the money market’s problems? That’s what bankers and their hired mouthpieces are saying.

So I need to get a few things off my chest about this notion that post financial crash Dodd-Frank bank regulations are the cause of the current repo market problems.

It’s total bullsh*t. The bankers and their superleveraged hed...



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The Technical Traders

Daily Market Forecast and Trading Patterns

Courtesy of Technical Traders

CLICK HERE TO GET REAL TIME TRADE ALERTS!

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Zero Hedge

US Ambassador Tells Impeachment Panel Of Trump-Ukraine Quid Pro Quo

Courtesy of ZeroHedge View original post here.

A lightning-fast leak of closed-door testimony from US diplomat to Ukraine, William B. Taylor, reveals his ongoing belief that there was a quid pro quo between the Trump administration and Ukraine - who President Trump asked to investigate the country's role in the 2016 US election, as well as corruption allegations levied at Joe and Hunter Biden.

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Insider Scoop

Roku To Purchase Dataxu For $150M In Cash And Roku Shares

Courtesy of Benzinga

Roku, Inc. (NASDAQ: ROKU) has entered into an agreement to acquire Boston-based Dataxu, a demand-side platform, for $150 million in cash and Roku shares.

Dataxu provides marketers with an automated bidding and self-serve software to manage ad campaigns progr...



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Kimble Charting Solutions

Apple Bullish Breakout Suggesting Tech Follows In Its Path?

Courtesy of Chris Kimble

Is Apple sending a bullish message to the overall Tech market? Sure could be

Apple (AAPL) is working on a breakout above last year’s highs at (1), after creating a series of higher lows over the past year.

Tech ETF QQQ has been a similar-looking pattern to Apple over the past few months, as it is near old highs while creating higher lows.

Is Apple’s upside breakout suggesting that QQQ will follow in its footsteps and breakout?

Str...



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Chart School

Gold Stocks Review

Courtesy of Read the Ticker

Gold stocks are swinging back forth between the range, and a break out swing higher is due. Gold stocks are holding a near perfect Wyckoff accumulation pattern. All should get ready to play this sector. Yet we must recognize that gold stocks are a one of the most crazy rides at the stock market fair, so play very carefully.

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GDX PnF chart from within the video

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Important channels around the HUI.
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Biotech

The Big Pharma Takeover of Medical Cannabis

Reminder: We are available to chat with Members, comments are found below each post.

 

The Big Pharma Takeover of Medical Cannabis

Courtesy of  , Visual Capitalist

The Big Pharma Takeover of Medical Cannabis

As evidence of cannabis’ many benefits mounts, so does the interest from the global pharmaceutical industry, known as Big Pharma. The entrance of such behemoths will radically transform the cannabis industry—once heavily stigmatized, it is now a potentially game-changing source of growth for countless co...



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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

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Members' Corner

Despacito - How to Make Money the Old-Fashioned Way - SLOWLY!

Are you ready to retire?  

For most people, the purpose of investing is to build up enough wealth to allow you to retire.  In general, that's usually enough money to reliably generate a year's worth of your average income, each year into your retirement so that that, plus you Social Security, should be enough to pay your bills without having to draw down on your principle.

Unfortunately, as the last decade has shown us, we can't count on bonds to pay us more than 3% and the average return from the stock market over the past 20 years has been erratic - to say the least - with 4 negative years (2000, 2001, 2002 and 2008) and 14 positives, though mostly in the 10% range on the positives.  A string of losses like we had from 2000-02 could easily wipe out a decades worth of gains.

Still, the stock market has been better over the last 10 (7%) an...



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Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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