Markets cannot survive elevated levels of fraud. They simply break down, and fail to perform.
Developments in the financial marketplace have been an area of interest for more than twenty years. I am somewhat disappointed, to say the least, with how things have gone. (See: http://www.creativeinvest.com/sri/corpeth.html)
Now, there is a case before the Supreme Court that will allow every person responsible for the recent financial crisis to escape punishment. The case is Gabelli v. Securities and Exchange Commission and "a decision is expected in the court's upcoming term, which ends in June."
I have decided to file a research paper (called an Amicus Brief) with the Supreme Court explaining why letting these guys go might be a bad idea for the rest of us, but I need your help.
What We Need & What You Get
According to one source, "any interested party with the $1,500 to $2,000 fee it costs to submit the brief in the proper bound format, can send (an Amicus Brief) in."
I am not a lawyer or pretending to be one. I might need an actual lawyer to file the thing, but I think I can get this done for $1,500. This is quite the bargain. One article stated that "Appellate lawyers who specialize in drafting such arguments estimate that the average (Supreme Court Friend of the Court) brief can cost between $25,000 to $50,000." The Supreme Court rules are clear:
"Every document filed with the Court shall be prepared using using a standard typesetting process (e. g., hot metal, photocomposition, or computer typesetting) to produce text printed in typographic (as opposed to typewriter) characters. The process used must produce a clear, black image on white paper. The text must be reproduced with a clarity that equals or exceeds the output of a laser printer."
The Supreme Court does not accept electronic or laser prints. Lower Courts do. I filed a brief in United States Securities & Exchange Commission vs. Citigroup Global Markets Inc. (Second Circuit Court of Appeals Case Number 11-5227). See:http://www.prlog.org/11948760-william-michael-cunningham-files-revised-brief-in-sec-vs-citigroup-2nd-cir-ct-of-ap.html?hosted
This means that, to file in the Supreme Court, you have to get the printing done by a professional printer. This is what the money is for.
- A thank you email.
- An electronic copy of the brief.
- A signed hard copy of the brief.
- An opportunity to edit the brief.
- A chance to make history (this will be the first crowdfunded Amicus Brief in history...)
Why it’s important to you.
The case hinges on this: Did the U.S. Securities and Exchange Commission wait "too long to bring a civil case accusing (the fund manager) of letting a client engage in..market timing?"
" 'Market timing' refers to buying and selling mutual fund shares in a manner designed to exploit short-term pricing inefficiencies. A mutual fund sells and redeems its shares based on the fund’s net asset value ('NAV') for that day, which is usually calculated at the close of the U.S. markets at 4:00 P.M. Eastern Time. Prior to 4:00 P.M., market timers either buy or sell a fund’s shares if they believe that the fund’s last NAV is 'stale,' i.e., that it lags behind the current value of a fund’s portfolio of securities as priced earlier in the day. The market timers can then reverse the transaction at the start of the next day and make a quick profit with relatively little risk. Mutual funds like GGGF that invest in overseas securities are especially vulnerable to a kind of market timing known as 'time zone arbitrage,' whereby market timers take advantage of the fact that the foreign markets on which such funds’ portfolios of securities trade have already closed (thereby setting the closing prices for the underlying securities) before the close of U.S. markets."
The bottom line: this, according to the former Attorney General of New York, “is like allowing betting on a horse race after the horses have crossed the finish line.”
And, it results in a real advantage: the favored client made "185 percent, 160 percent, and 73 percent, respectively..the rate of return for all other (fund) shareholders over the same period was, at best, negative 24.1 percent."
The manager claims that "the statute of limitations clock began to tick in 1999. The SEC did not bring charges until 2008, and "the SEC's statute of limitations is five years in cases where the agency is seeking a financial penalty.." Too late. Too bad. So long.
Why did the SEC wait so long? Well, they first had to take their head out of their..I mean, there's the matter of not actually knowing about this behaviour. The manager did not publicize that they were doing this...
What you will help achieve.
If the case is decided for the Fund manager, it means that no one even remotely responsible for the financial crisis will have to worry about anything. They will all claim that the statute of limitations has run out.
You might say, "I don't want the SEC coming after me ten years after I have done something."
I get that. That's why my brief suggests that the extended time limits be applied only to the SEC and only for this type of case. (If they can do it in Bush v. Gore, why not here?). Unless you are planning to engage in marjor market fraud, I don't think you have anything to worry about.
How does this whole thing work?
Technically, anyone can file a Friend of the Court brief. You are just giving the Court your opinion on a case. It works as follows:
- You ask the lawyers in the case if you can file. In this case, it's the Solicitor General of the United States (who said yes) and some private lawyer guy (who also said yes.)
- You file the thing, asking the Court (as in Supreme Court) for permission.
- The document you submit must have a green cover. You have to supply forty copies. They have to be printed and bound in a certain way. The money is for the printing....
- I do not have to provide a list of all who gave money in support of this effort to the Supreme Court. I simply have to say that I got outside support. I won't list you in the thing unless you want me to...and I will check with you before doing so.
I've done this before, but not in the Supreme Court....see: http://prlog.org/11782028
Yes, the arguments in my brief were mentioned by the Court, but the chances that this thing will actually have an impact on the ruling in the Supreme Court are not high. As one person put it, "No court is obligated to follow or even to consider the advice of an amicus curiae, even one it has invited."
According to another article, "In the Supreme Court's last term, only eight percent of the total 628 briefs filed by non-government amici were cited by the justices, according to a report by R. Reeves Anderson and Anthony Franze of the law firm Arnold & Porter. Of those that got a nod, nearly half were written by prominent appellate lawyers from Washington, D.C.-based firms with Supreme Court practices.
Not even the justices necessarily pay much attention to them. Antonin Scalia, in October told students at Chicago-Kent College of Law that he doesn't read amicus briefs. He instead passes them on to his clerks. Last year, former Justice John Paul Stevens complained of amici fatigue to an audience at Northwestern University Law School, saying 'we could get along with fewer amicus briefs.' "
They don't really want to hear from me (or you) but, so what? You have the right to have your voice heard. If it doesn't work, well, at least you tried...
Other Ways You Can Help
Some people just can’t contribute, but that doesn’t mean you can’t help:
- Get the word out and make some noise about our campaign.
- Use the Indiegogo share tools!
And that’s all there is to it.
A Final Word
You can make an anonymous contribution, too. Just go to the checkout and select the anonymous option!