Washington Times Promotes Polar Petroleum Pump and Dump

0

I’m not going to run the promoted stock scoreboard again so soon, but let it be known that Dephasium has fallen ~75% in the 5 days since I wrote about it.  Put on your peril-sensitive sunglasses, here is the chart:

Polar Petroleum

Yes, my article was written at the peak.  In this case the “dump” was rather violent.

Odey Special Situations Fund took on several new positions in March

Crispin OdeyOdey Asset Management's Special Situations Fund was down 3.2% in March, compared to its benchmark, the MSCI World USD Index, which was up 3.3%. Through the end of March, the fund is up 8.7%, beating the benchmark's return of 4.9%. Q1 2021 hedge fund letters, conferences and more Odey's Special Situations Fund deploys arbitrage and Read More


But why I am I writing about promoted stocks this evening?  This morning in my e-mail, I received this [note: after a little time, this link won’t work].

But who sent it to me?  The Washington Times.  After receiving it, I sent someone in their web area this letter:

YYY,

I don’t know if you handle this aspect of Washington Times advertising, but today I received a promoted stock ad for a fraudulent company from the Washington Times via e-mail.

The company’s name is Polar Petroleum Corp (OTCBB:POLR),

 a company which:

  • Has never earned a penny of revenue.
  • Was a “technology company” until last year, “Post Data.” From its last 10K: “The Company intends to market a service of decommissioning electronic data storage devices, making them inoperable and thereby making the electronic data contained therein or on permanently un-recoverable.“
  • Is likely being used by the promoters to do a “pump and dump,” where affiliates do a series of transactions that inflate the price of the thinly traded stock, and use this promotion to dupe people into buying out their shares at inflated prices, leaving them holding stock of a worthless company.  The net worth of the company is $0.005/share – It trades near $5 thanks to the pump.

It’s dishonest for the Washington Times to participate in crud like this.  Why is the Times selling its reputation for a bunch of promoted stock scammers?

Sincerely,

David

PS – I have written about this extensively.  Here is a sample:

http://alephblog.com/2013/06/03/another-lousy-promoted-stock/

To have a reputable newspaper convey the garbage that the promoters put forth is new, and worrisome.

But about the same time that I hit the “Send” button, the SEC took action.  They suspended trading in Polar Petroleum Corp (OTCBB:POLR)They justified it here.  Good work, SEC!  (Can’t remember the last time I said that.)  And if you want to see the reactions of those that follow promoted stocks regarding Polar Petroleum, you can see it here.

Though the loser promoting this garbage said it would go to $27, I’ll give you a different prediction: it will go to less than fifty cents within a year.  Given the actions of the SEC, it could easily go there on June 24th, when trading reopens.

Here is my advice to the SEC: maybe you could create a unit that follows promoted stock fraud, and do exactly what you have done with Polar Petroleum to every promoted stock scam.  It would eliminate a significant area of fraud in our equity markets.

By David Merkel, CFA of Aleph Blog

Previous article SoftBank Increases Sprint Nextel Offer To $21.6B
Next article Fannie Mae, Freddie Mac Shareholders Sue U.S. Government
David J. Merkel, CFA, FSA — 2010-present, I am working on setting up my own equity asset management shop, tentatively called Aleph Investments. It is possible that I might do a joint venture with someone else if we can do more together than separately. From 2008-2010, I was the Chief Economist and Director of Research of Finacorp Securities. I did a many things for Finacorp, mainly research and analysis on a wide variety of fixed income and equity securities, and trading strategies. Until 2007, I was a senior investment analyst at Hovde Capital, responsible for analysis and valuation of investment opportunities for the FIP funds, particularly of companies in the insurance industry. I also managed the internal profit sharing and charitable endowment monies of the firm. From 2003-2007, I was a leading commentator at the investment website RealMoney.com. Back in 2003, after several years of correspondence, James Cramer invited me to write for the site, and I wrote for RealMoney on equity and bond portfolio management, macroeconomics, derivatives, quantitative strategies, insurance issues, corporate governance, etc. My specialty is looking at the interlinkages in the markets in order to understand individual markets better. I no longer contribute to RealMoney; I scaled it back because my work duties have gotten larger, and I began this blog to develop a distinct voice with a wider distribution. After three-plus year of operation, I believe I have achieved that. Prior to joining Hovde in 2003, I managed corporate bonds for Dwight Asset Management. In 1998, I joined the Mount Washington Investment Group as the Mortgage Bond and Asset Liability manager after working with Provident Mutual, AIG and Pacific Standard Life. My background as a life actuary has given me a different perspective on investing. How do you earn money without taking undue risk? How do you convey ideas about investing while showing a proper level of uncertainty on the likelihood of success? How do the various markets fit together, telling us us a broader story than any single piece? These are the themes that I will deal with in this blog. I hold bachelor’s and master’s degrees from Johns Hopkins University. In my spare time, I take care of our eight children with my wonderful wife Ruth.

No posts to display