Anthony Elgindy

Anthony Elgindy, 2010

Anthony Elgindy (born November 28, 1967), born Amr Ibrahim Elgindy in Egypt, is the founder of Pacific Equity Investigations, and is best known as "Anthony@Pacific", the "Internet's most theatrical short-seller".

In the early 1990s, Elgindy, who had worked at several pump and dump brokerages, admitted to authorities that he had accepted bribes from stock promoters. Without any promise of immunity from prosecution, he entered into a cooperation agreement with the US Attorney's Office in the Southern District of California during this time of rampant fraud in penny stocks. Elgindy showed investigators how such stock frauds worked and helped prosecutors win several convictions. Concurrently, Mr Elgindy was collecting disability benefits from his insurance company. Four of those monthly payments turned out to be improperly received since he was also working at a Texas brokerage office in 1994. In 1999 after becoming the most bookmarked financial commentator on Siliconinvestor.com he was charged for these insurance payments. Soon after he pled guilty and was sentenced to four months in prison.

By the late 1990s, Elgindy had gained an Internet following as a stock picker, and sold stock tips for $600 a month to online subscribers. His picks featured short selling stocks of companies that he purported to have negative information about, especially concerning company officials and pending Securities and Exchange Commission (SEC) investigations. Elgindy knew of these investigations as he is the one who reported the companies to the SEC and gave them the information originally.

In 2003, the NASD ruled that Elgindy and his firm Key West Securities "engaged in a manipulative scheme in 1997 to inflate artificially the share price of Saf T Lok, Inc. through the entering of fraudulent quotations in the Nasdaq system, selling the stock short at the artificially high prices, and then taking active steps to depress the share price of Saf T Lok through the dissemination of negative research comments." Elgindy and Key West Securities were fined $51,000 and had their NASD memberships revoked. However, the NASD's finding was overturned the following year by the SEC, which pointed out that the “Courts have found that the dissemination of accurate information in the securities market is not a manipulative act.” (In the Matter of the Application of Amr Elgindy, et al., Admin. Proc. File No. 3-11145 (March 10, 2004), at 6). The NASD attempted to appeal to the SEC’s decision to the D.C. Circuit. However, the D.C. Circuit dismissed the NASD's petition, which it characterized as “not only unprecedented, but legally insupportable,” thus upholding the SEC's reversal of the NASD's decision against Elgindy. In addition, in its ruling, the D.C. Circuit described NASD as a “disgruntled first-level tribunal, complaining because it has been reversed by a higher tribunal”. (National Association of Securities Dealers v. Securities, Inc. v. Securities and Exchange Commission, 431 F.3d 803, 812 (D.C. Cir. 2005)

Elgindy was charged in January 2005 with racketeering, securities fraud and other crimes in connection with a supposed scheme to steal confidential law enforcement information relating to FBI and SEC investigations of various companies. After a four month trial, involving allegations in 32 different stocks, Elgindy was acquitted of most of the charges against him and convicted of "inside-trading" in just five of those stocks with illegal gains totaling less than $66,000. However, at sentencing the Judge, using an obscure provision of the Federal Sentencing guidelines "enhanced" Mr Elgindy's sentence with each and every count he was acquitted of and gave a total of nine years in prison. They also held him financially responsible for all the gains that nine other individuals were allowed to keep. Mr. Elgindy was the only trader who was ever sent to prison in this case, even after the government finally admitted in their own chart that he had never paid agents Royer or Wingate any money.In December 2008, a New York-based appeals court upheld Elgindy's 2005 conviction.

References

• Linda Christiansen, "When Telling the Truth is a Crime, Elgindy Faces Charges that He Manipulated Stocks with Accurate Information," The Wall Street Journal, November 1, 2004
• Conor Dougherty, The San Diego Union-Tribune, "SEC overturns ban on stock trader | Elgindy's firm also ordered reinstated," March 11, 2004
• John R. Emshwiller, "A Felon's Wife Picks Up the Pieces Of Her Luxury Life," The Wall Street Journal, November 29, 2005
• John R. Emshwiller, "Online Maverick Sells the Internet Short," The Wall Street Journal, July 22, 1999
• John R. Emshwiller, Scam Dogs and Mo-Mo Mamas: Inside the Wild and Woolly World of Internet Stock Trading
• Gary Wolf and Joey Anuff, "Dumb Money: Adventures of a Day Trader," Wired (Apr. 2004)
• David Cohen, Chasing the Red, White, and Blue

External links

• "Inside Truth - Official website of Anthony Elgindy". http://www.inside-truth.com. 

• "The Naked Short - Official website of Anthony Elgindy". http://www.thenakedshort.com. 

• "Anthony@Pacific - Official Silicon Investor thread". http://siliconinvestor.advfn.com/subject.aspx?subjectid=23993. 

• Elgindy, Anthony (January 1, 2011). "Raping Main Street:Wall Street's Greatest Con - The "Borrow"". http://thenakedshort.com/New_Articles/GreatestCon2011.html. 

• "Manuel Asensio's Reading Room, The Elgindy Files". http://www.asensioexposed.com/readingroom.htm#Elgindy. Retrieved 2007-12-03. 

• Kowalski, Robert (2000). "This Silicon Investor Is Now Anthony@FederalDetention.gov". http://www.thestreet.com/tech/internet/940672.html. Retrieved 2007-04-30. 

• Weiss, Gary (2002). "What to Bet Against". http://www.businessweek.com/magazine/content/02_26/b3789634.htm. Retrieved 2007-04-30. 

• Berenson, Alex (May 23, 2002). "Five, Including F.B.I. Agents, Are Named In a Conspiracy". The New York Times. http://query.nytimes.com/gst/fullpage.html?res=9805EEDF1E38F930A15756C0A9649C8B63. Retrieved 2007-05-01.