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Credit Suisse First Boston Fined $100 Million
A couple of people wrote in to note that Credit Suisse First Boston, which was the underwriter for VA Linux ? ' IPO, has been fined $100 million for actions they took in that and other high-tech IPO's during the stock market boom. CSFB allocated shares of certain IPO's to customers who made kickbacks to CSFB. Here's their side of the story. There's also an additional statement by the regulators and CSFB's settlement agreement (PDF).
this is why people form corporations.
remove corporate "status" people would go to jail.
Why do you think corporations exist, to help consumers? hahaha
The Kruger Dunning explains most post on
I wouldn't be surprised if a few other brokerages will get nailed pretty soon, for similar kinds of shennanigans. Disclaimer: I have no direct knowledge of any regulatory investigation of ETrade, but we all know that they pretty much played the same games with RHAT.
At least with CSFB did in fact give a handful of shares to everyone who applied for the friends-in-family deal - AFAIK - while ETrade tried to come up with every excuse in the book to kick out as many people as they could in their friends-and-family program. Although some of us did eventually get our pound of flesh (see my website: E*Trouble to revisit those exciting times) it would be icing on the cake to see EGRP whacked on the balls, again.
Ever heard the expression "Boston Wad" or "Pigeon Drop?" It's a con game where you get a roll of dollars, then add a fifty to the top. Wrap with elastic band.
Then you find your mark, and agree to go drinking. Show him the huge wad of "fifties". Drop it (with him in tow) in a locker or safety deposit box and keep the key.
Later on in the evening, get a phone call/page or something telling you to get out of town or whatever. (This works really well if both of you are dopers/criminal element) Suggest to your new friend that you need to boot out of town and could he grab you $400 from the ATM for bus fare, etc? He's totally entitled to keep the $1000 in the locker - you haven't time to get it and get out of town and are willing to eat the loss in order to save your neck.
You get the $400 and split. Your "friend" finds out his wad was worth $75 or so.
Dotcoms were pigeon drops. Legal ones. "Oh, uh, yeah, this stock's going to be the next Microsoft. Want mine for $100 a share? I made enough money on it having bought in at $3 a share!"
--- Jump!! Fire!! Bullet time!! - Lego version of the Matrix
A back-of-the-napkin calculation shows that $36M to now be $350K. Of course, to be fair, that still ain't exactly hurting. But yeesh, hindsight makes "Surprised By Wealth" one seriously painful read...
And even richer a read, given CSFB's plight, is the ZDNet article on the subject of ESR's fortune, which, with unintended irony, observes: Yeah. It's been answered alright.