Hi All –
Now that we’ve survived the oral arguments and the Appellate hearings, we can turn back to some of the legislative issues. Here it goes.
HR757 – The Equitable Treatment of Investors Act. Perhaps with the advent of Spring, Congress might put some of its bickering aside and find its way to behave sensibly. Congressman Garrett’s legislation – which establishes final accounts statements as the basis of net equity and which prohibits clawback of innocent investors — is now in play, and with Congress getting back in swing after a recess, meetings with congressional members are underway. Your grassroots efforts have generated over 250 letters and copies of these are now being taken to these meetings. We are seeking to broaden the message to make the bill more palatable to congressional members outside of high victim areas – the changes being introduced in this bill benefit all investors and help improve investor confidence. Besides looking to get victims’ congressional members to sign on, we are working hard looking to expand the message to congressmen in other areas by asking friends and non-victim family members to write and fax as well. It’s important that everyone attempt to generate 2 or 3 letters. The message is simple: every investor needs to trust in the validity of their investment statements now. Keep those letters coming folks. Let’s see if we can get another 15 sponsors by the end of April.
We continue to advocate on behalf of indirect victims, although a stepped-up effort to engage legislators in high indirect victim areas would be helpful at this point. Congressman Perlmutter (D-CO) is unlikely to be able to undertake this effort on his own. Although we expect the SIPC Modernization Task Force to address the issue when they present their report perhaps before the summer, a consistent effort by victims of their congressional representatives can only help, as well as keeping the concerns of the indirects on the radar of Congressman Garrett.
SEC. As you may know, Darrell Issa (R-CA), chair of the House Committee on Oversight & Government Reform, held a hearing on what appears to be a fairly obvious conflict of interest issue regarding David Becker, Chief Counsel at the SEC, and his involvement with BLMIS. Becker, it turns out, is a clawback victim. Records are being subpoenaed from both the SEC and Picard on this issue. While we feel this is generally a fishing expedition, it returns the spotlight to the SEC’s dismal failures. We are considering PR actions around these issues, but we also need to be careful about getting into a catfight between the Republicans and Democrats. That said, further investigation into the ineffectiveness of the SEC, and oversight of both FINRA and SIPC are high on our congressional action list.
Tax Legislation. We continue to work carefully behind the scenes on the tax legislative side. We remain cautiously optimistic that legislation will be reintroduced both by Congressman Pascrell and Senator Schumer – both bills having had strong co-sponsorships last year. Once legislation is reintroduced, we will work to finalize any needs for scoring (the “cost” of the legislation to the taxpayer must be determined before passage), and press for passage of the legislation.
We expect Congressman Pascrell to reintroduce his bill on or around April 15th (for the obvious effect) and early indication is that he could be joined by Republican Charles Boustany (R-LA) who has constituents with Stanford accounts. It is important to get the “Madoff” Members of Congress and the “Stanford” Members of Congress working together on the tax legislation.
PR. Investors are appropriately gloomy about the lack of effective positive media in support of our message. The Trustee has been in the driver’s seat, seemingly at will. While not quite apparent, we have had some important background successes in the media. Our PR firms, particular the new firm in Washington DC is actively building relationships with key media. These successes may not be evidenced in articles, but the media in significant part has been educated on our perspective and is coming around. What we have learned is that the media needs “something new” and “something compelling.” It is not enough for us to just counter something the trustee says. With our dramatically expanded PR team, we are seeking to drive home the more universal message to all investors – “This could happen to you. You need to be protected. etc.” A detailed tactical strategy is now evolving and will continue to incorporate victim stories. We thank those of you who have already come forward, but we need more people willing to speak with the media. Our PR team will coach you so you will never go “blind” into an interview.
Action Item: Letters. It’s time to kick the letter writing “grassroots” and “grasstops” effort into higher gear. If you haven’t written your Congressional letter yet, please commit to sending yours and then having at least two additional letters sent by friends and family. There is a special “friends and family” template at http://www.investoraction.org/?page_id=2306. As part of the “grasstops” campaign — If you have personal relationships with Congressional members or key staff, please contact them, set up meetings, and let us know so we can follow up.
Right now there is nothing you can do to help that is more important than moving HR757!
If you have any further questions, please contact us as shown below.
In Peace,
Ron Stein
