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Joanne98 Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Aug-24-08 05:17 PM
Original message
Son of McCain Narrowly Skirts Banking Scandal

Excerpt from "No-taxes pledge helps conservative activist oust three Republicans"
Las Vegas Review-Journal
Aug. 15, 2008

... BANK NOTE: When banking community veterans scoffed last month about the sudden departure of McCain's son from the board of Silver State Bancorp of Henderson, they laughed that "personal reasons" was a pretty vague excuse for the rapid separation.

Now comes word that Silver State's holding company is reporting a $73.2 million loss in the second quarter. Sounds as if Andrew McCain's departure came just in time to avoid being part of a story that might have generated big headlines nationally. ...

Silver State Bank: Whats Deposited in Vegas Doesnt Stay in Vegas
By Mark Faulk

"When the casinos treat you poorly, let Silver State treat you like a valued customer." ~ Silver State Bank Motto

In yet another bizarre development in the saga of CMKM Diamonds, better known as CMKX, one of the largest financial frauds in history, Andrew McCain, the son of presumptive Republican presidential candidate John McCain, resigned from the Board of Directors of Henderson, Nevada based Silver State Bank, the bank where hundreds of millions of dollars was deposited as it was stolen from CMKX shareholders.

Almost immediately, the internet began buzzing with rumors and stories, mostly either questioning Silver States financial condition or drawing the inevitable comparison to his fathers involvement twenty years ago in the infamous Keating 5 savings and loan scandal, where federal regulators seized Lincoln Savings and Loan Association of Irvine, California. The senior McCain was rebuked by the Senate Ethics Commission, who concluded that he had and four other senators had tried to hold off a government investigation into the savings and loans risky real estate deals. Lincolns chairman at the time was Charles Keating, who was not only one of McCains top donors, but was a business partner with Cindy McCain.

But the younger McCain, who had only been with Silver State Bank for a little over four months after Choice Bank, where McCain was director, was taken over by Silver State, might have to answer questions of his own. Silver State Bank has its own history of problems, and it appears that Andrew McCain either ignored the banks past woes, or didnt properly research the company before joining the Board of Directors.

Just two months ago, one of the banks executive vice-presidents resigned after the company reported a massive loss for the first quarter of 2008, which the company blamed largely on the deteriorating real estate market. The bank recently announced plans to raise an additional $40 million in capital, which could be a problem, since their share price has dropped over 95% in the past year, from a high of $19.48 to July 29ths closing price of $1.18. Their market cap has fallen from $275 million to less than $17 million. At todays closing price, that $40 million in additional capital will more than triple the companys current number of outstanding shares.

Theres morea lot more. Andrew McCain served on the banks Audit Committee, which means his responsibilities included, according to the companys bylaws, an understanding of finance and accounting:

All of the members of the Audit Committee must have a basic understanding of finance and accounting and be able to read and understand fundamental financial statements. At least one member of the Audit Committee must be an audit committee financial expert, as determined by the Board, consistent with the applicable rules and regulations of the Securities and Exchange Commission and the applicable rules and regulations of the stock exchange on which the Corporations shares are listed.

But a little diamond mining company from Canada that turned out to be the biggest penny stock fraud in history might become a major problem for McCains campaign as well. Insiders with CMKX defrauded over 50,000 shareholders of in excess of $250 million. A large portion of that money was run through a single Silver State Bank branch in Las Vegas. In all, former CMKX CEO Urban Casavant and reputed mastermind John Edwards (no, not that John Edwards) opened over 100 bank accounts at Silver State, and ran tens of millions of dollars through the bank.

In one multi-million dollar gamble taken by Silver State Bank, they accepted not just one but four checks for $2.5 million dollars each from a fraudulent company account at Wells Fargo Bank in Las Vegas in one weekwritten on temporary checks. John Edwards opened an account for a company called Saint George Metals on the same day that CMKM Diamonds announced a business partnership with the company, which in reality was just a bank account whose only signor was John Edwards. Edwards would write a $2.5 million check to CMKM Diamonds on a temporary check from Wells Fargo, and Urban Casavant would deposit it the official company account at Silver State Bank and write a press release announcing the investment. In turn, money was filtered back to Edwards either in illegally issued company stock or cash, essentially making the exchange a wash. To Silver State Banks credit, they at least wrote HOLD across one of the deposits, apparently waiting for the $2.5 million temporary check to clear before crediting the CMKM Diamonds account.

This was not an isolated case, but was instead the normal way of doing business with Casavant, Edwards, and their cohorts. It was an incredible whirlwind of activity for Silver State Bank and other Las Vegas banks, including Wells Fargo, Nevada State, and Sun West Bank. Hundreds of checks, wire transfers, and deposits totaling tens of millions and possibly hundreds of millions of dollars flowed like champagne in the Vegas casinos.

Among the transactions executed by Silver State Bank:

Wire transfers totaling hundreds of thousands of dollars were executed with only the notation transferring to Personal Acct. per cust. transfer via phone.

Checks from the CMKXtreme and other accounts controlled by Casavant and Edwaerds written out only to CASHincluding one for $350,000.

Multi-million dollar wire transfers between Edwards and Urban, run through one of the almost 100 accounts they controlled there.

Millions of dollars written out of company accounts to Urban, his wife Carolyn, and several family members, often on temporary checks.

The scam finally came crashing down in late 2005 when the SEC finally delisted CMKX, and a shareholder named Kevin West was appointed by Urban to take over while Casavant fled to Canada. West inherited a company with no tangible assets, no real businessand $558 in the bank. Edwards, Casavant, and their cohorts had stolen the rest. West brought in Bill Frizzell, an attorney from Tyler, Texas, who had been conducting a multi-year investigation into CMKX for a shareholders group.

They have since filed numerous lawsuits against Edwards, Casavant, and others, and have subpoenaed records from Silver State Bank and other banks associated with the scam in an ongoing effort to recover assets for the defrauded shareholders. The SEC recently filed charges against eleven individuals and three companies in the CMKX case, but a multi-year investigation by a task force comprised of the DOJ, FBI, and IRS has yet to produce any arrests or charges.

Silver State Bank has not been charged in the CMKM Diamonds case, although they did fire an employee named Patricia DeCosta, who approved most of the transactions. DeCosta in turn filed a lawsuit in early 2006 against her former employer, detailing her side of the story:

Throughout plaintiffs employment she was encouraged to open new accounts and each performance appraisal done with regard to her employment speaks glowingly of the number of new accounts her branch opened.

That on or about the 5th day of September 2004 the bank was served with a subpoena with regard to accounts maintained at the branch plaintiff supervised. Certain executives of defendants (Silver State Bancorp, Silver State Bank) owned stock in companies controlled by the subject of the subpoena and became disconcerted when the bank was served with the aforementioned subpoena.

Seeking a scapegoat the bank terminated plaintiff claiming she had not processed a suspicious activity report in a timely manner. Plaintiff was unable to timely process the SAR due to the fact that she was undergoing a serious health condition, which required her to take leave from her employment.

The fact remains that Silver State Bank never filed a single Suspicious Activities Report (SARS) while 50,000 CMKX shareholders lost their entire investments. Did Andrew McCain look into the banks shady past, and if so, is he now just quietly trying to slip out the side door before the building comes tumbling down?

How this new twist plays out remains to be seen, but the saga of CMKX, as detailed in The Naked Truth: The Stock Play of a Lifetime seems to be a story that wont go away. After years of being ignored by public officials at all levels, maybe it will take a presidential campaign to expose the seedy underbelly of corruption in our financial markets.

And alwaysis the Faulking Truth.

Silver State Bank: Like Rats From a Sinking Ship

(Mark Faulks first book, entitled The Naked Truth: Investing in the Stock Play of a Lifetime, is now available at . Buy it now while you still have a few dollars in the bank. Tune in with Mark Faulk and DeWayne Reeves every Friday from 9-10 AM CST on The Faulking Truth Show, and join Mark and Paul Faulk every Saturday from 1-2 PM CST on The Faulking Truth X2 Show at )
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enough Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Aug-24-08 05:22 PM
Response to Original message
1. Now that they're going after Biden's son, this story becomes more important.
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dkf Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Aug-24-08 05:24 PM
Response to Original message
2. Oh my, that does not look good
Looks like they didn't have appropriate controls for their suspicious activities.
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Joanne98 Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Aug-24-08 05:36 PM
Response to Reply #2
3. No it doesn't. A penny stock scheme in Canada. Where have I heard this story before?
Edited on Sun Aug-24-08 05:37 PM by Joanne98
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Joanne98 Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Aug-24-08 05:46 PM
Response to Original message
4. Utah Senator Bennett Duped In Penny Stock Scam

by Tony Ryals Wednesday July 20, 2005 at 10:43 PM

Utah Senator Robert Bennett is either involved in or was duped into aiding a fraudulent pump and dump scheme of a penny stock scam called Global Links(gbll) and others that are fraudulently claiming to be 'naked shorted' to cover up illegal pump and dump activities and probably money laundering !!! Also he made the false claim to the SEC and former Chairman Donaldson in a public hearing that Global Links was a victim of 'naked short' selling.He was either duped by James Dale Davidson a Beltway con artist who goes by alias Bob O'Brien on his 'naked short' scam website or is aiding and abetting the fraud !!!!

It appears much of this penny stock fraud may have a Beltway connection and Senator Bennett appears to be doing political favors for's Patrick Byrne who has donated to Republican causes, including the anti-Kerry Swift Boat Captains, etc..

Senator Bennett probably knows the penny stock fraudster James Dale Davidson who is allowed to carry on his masquerade even threatening others over the internet because of his far right leanings and Beltway political connections !!!

So far the SEC has done nothing to uncover and dismantle what increasingly appears to be a massive right wing securities fraud with Beltway origens.

The following is a follow up to 'Google Censors Indybay For Patrick Byrne,' and Washington Post , whose link is below. As an aside for Google watchers,utah.indybay appeared to be down for a while a day or so ago,but to my surprise
Google STILL managed to crawl and cache the entire
article I posted here on the 18th !!!

Now it appears to have gone missing already like the first 'Boycott' article on Indybay !!! You can only get an index listing containing 'Google Censors Indybay',etc.,of website,and now ,instead of a full cache of my article here as it was cached almost immediately,you only get a Google link to your homepage and not my article here !!! Hopefully this will change and Google will 're-cache' it.

Below the link to my previous article here is a WJS aricle by In The Money columnist Carol Remond to add more detail to my commentary-grievance as a victim of this penny stock money laundering scam hidden by SEC's inability or unwillingness to audit shares that encourages not only white collar penny stock criminality but post 911 money laundering as far away as Kuala Lumpur or Dubia where shares of Endovasc,of Montgomery,Texas and Nevada,as only one example, were 'traded' in boiler room operations.

In a sane society I would contact Senator Bennett's office directly to let him know he had been taken into supporting a massive penny stock scam that may have aided terrorism besides robbing me of 100% of my investment..In truth it is greatly a Beltway scam just as Nigerian letter scams are from Nigeria.Or Stanford University that allowed a patent to be used knowingly or not in an illegal penny stock pump and dump scam that Charles Schwab,probably LOM of Bermuda and eventually even Belladorgroup boiler room of terrorist and money laundering country Dubai was involved in !!!

And I say with all sincereity the person chiefly responsible for this massive securities fraud involving many penny and medium size companies,including Patrick Byrne's that has used the false claim to promote himself and his scammy, was James Dale Davidson of the National Taxppayers Union who fraudulently passed himself off as 'Bob O'Brien' in the $100,000+ ad-letter to President Bush in the Washington Post on February 8 !!!!! He has given Congressional testimony in the past re taxes and it is highly unlikely this man who accused Clinton of killing Vince Foster is unknown to Senator Bennett.

Senator Bennett,in denouncing 'naked short selling' to the SEC never refered to that letter in the Washington
Post' ,in my opinion, because he KNEW it was a Beltway fraud and those behind it.I wish he would prove me wrong.And does it not appear very strange that in this post 911 era an anonymous person can place an open letter to the President in the
'Washington Post' representing an organization never heard of before,(NCANS'), to give the President stock and SS investing 'advise',

And with a website located not in U.S.,but the, B.V.I., a known site of penny stock fraud and money laundering !!! And using the address of a strip tease 'club' in Las Vegas !! Does Senator Bennett approve of that ? Does he wish to endorse the strip joint as well ?

And there is no political will to identify this 'Bob O'Brien' that Senator Bennett and Patrick Byrne both take to be a securities expert on and adviser (ha ha) about 'naked shorting' ? Senator Bennett and Patrick Byrne are either unpatriotic or incompetent in this matter.And they are knowingly or not aiding and abetting a securities fraud.

Why does President Bush and the Secret Sevice, much less the 'Washington Post ' where the anonymous ad was placed not have the political, security,or journistic will to know who places paid letters to Bush from the B.V.I. using false names
and a Nevada stip tease joint as an address ? !

Weren't we told such types of messages could be terrorists sending secret hidden communication ? I think Senator Bennett owes myself and many others defrauded in such illegal penny stock scams and money laundering operations an explanation and the SEC or FBI etc.should be called to investigate.
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Joanne98 Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Aug-24-08 05:53 PM
Response to Original message
5. A G.O.P. Power and His Penny-Stock Boards

Questions have been raised before about Mr. Gargano's business practices.

An engineer by training, he became a senior executive at J. D. Posillico Inc., a major construction company on Long Island. In 1981, the company was accused of rigging bids on a sewer contract; it eventually paid $315,000 to settle a lawsuit, though it did not admit wrongdoing.

A two-year criminal investigation into whether Mr. Gargano had done favors for political contributors ended in January 2001 when the Manhattan district attorney's office issued an unusual public statement saying that no charges would be pressed.

Then there was Alpha Hospitality, where he became a director in 1993. He resigned in September 1995 and sold his stock after state legislators complained about what they saw as conflicts of interest. Alpha is trying to open a casino with the St. Regis Mohawk tribe in upstate New York.

Even when Mr. Gargano was on Alpha's board, there were signs of trouble at the company, which was heavily in debt and losing money. Its president, Monty D. Hundley, resigned in March 1995 for what the company said were personal reasons -- and after the Indiana Gaming Commission asked to see his tax returns. In fact, Mr. Hundley had not filed federal income tax returns after 1981, according to an indictment prosecutors filed earlier this year in Federal District Court in Manhattan. The 21-count indictment accuses him; Stanley S. Tollman, the company's former chairman; and several associates of engaging in a complex $42 million scheme to defraud banks and avoid taxes.

Lawyers for both men did not return telephone calls. Mr. Hundley has entered a plea of not guilty; Mr. Tollman, a major Republican Party contributor who resigned from Alpha in February, is a fugitive, said a spokesman for the United States attorney's office in Manhattan.

Since March, investors have filed a raft of lawsuits against Eagle, Mr. D'Amato and, in one case, all the directors including Mr. Gargano. Last month, a federal judge in West Palm Beach, Fla., consolidated the suits into one class-action complaint, and the lawyers have a few weeks to figure out how many defendants there will be. It is not yet known if Mr. Gargano will be one.
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Joanne98 Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Aug-24-08 05:59 PM
Response to Original message
6. One of my old threads....

Trail of Evidence Points to Major Covert Operation Targeting Venezuela

By Bill Conroy
Special to The Narco News Bulletin
March 11, 2008

Two Florida-based companies that have exported a total of at least 11 aircraft to Venezuelan buyers since 2003 are linked to four cocaine planes and what appears to be an elaborate covert intelligence operation, an ongoing Narco News investigation shows.

The covert program, law enforcement sources contend, likely involves the CIA and components of Defense Department intelligence agencies, and is focused, in part, on penetrating, or even propping up, narco-trafficking groups in Venezuela. That countrys outspoken leader, Hugo Chvez, is regularly demonized by U.S. policymakers for, among other things, supposedly allowing his country to become a haven for narco-traffickers.

The operation also appears to prioritize intelligence objectives over law enforcement goals, which means tons of cocaine might well be getting a free pass into the United States.

Foreign law enforcement authorities confiscated two of these cocaine planes one in the Dominican Republic and one in Nicaragua, (tail numbers N1100M and N391SA, respectively) on suspicion of cocaine trafficking. A third plane (tail number N12DT) is cited along with N1100M in a pending FBI money laundering case involving a Venezuelan-based drug-trafficking organization.

The fourth aircraft, a Gulfstream II jet (tail number N987SA), crashed in Mexico in late September last year with a payload of some four tons of cocaine onboard.

The companies at the center of this parade of cocaine planes are Skyway Aircraft Inc. of St. Petersburg, Fla., and Planes and Parts Enterprises LLC of Doral, Fla.

In addition, a third Florida company, also named Skyway Aircraft Inc., but based in Clearwater, Fla. (just north of St Petersburg in the greater Tampa area), is linked to a fifth cocaine plane, a DC-9 jet (tail number N900SA), which was apprehended by Mexican authorities in April 2006 with some 5.5 tons of white powder onboard. The DC-9 had been sold to an unknown Venezuelan buyer only days before it was busted in Mexico.

Two of these cocaine planes the Gulfstream II and a Beech 200 (N391SA) found in Nicaragua with the false tail number N168D have been tied to the CIAs terrorist rendition program via their Federal Aviation Administration-issued tail numbers, according to European investigators.

In addition, the two Skyway companies are associated with individuals who have done highly sensitive work for the Department of Defense or U.S. intelligence agencies, public records show and Narco News sources confirm. The third company, Planes and Parts, it turns out, appears to be little more than a paper shell company that can be traced back to a Mail Boxes Etc. service located at a UPS store in the Miami area.

None of the principals of these three companies has been charged with any crime in relation to the cocaine planes as would be expected in a U.S.-sanctioned intelligence operation. Company officials with Skyway Aircraft in St. Petersburg contend they have done nothing wrong and claim they cannot control what happens to an aircraft once it is sold to an overseas buyer.

Representatives of Skyway Aircraft in Clearwater, whose parent company is now in bankruptcy, could not be reached for comment. The companys phone number is disconnected.

However, a shareholder and major creditor in the company who operates a separate firm that sold the DC-9 jet apprehended in Mexico with 5.5 tons of cocaine onboard also told Narco News he has no control over what happens to an aircraft once it is sold to a foreign buyer.

The principal of Planes and Parts, an individual named Andrew Wilson, could not be located and appears, based on a search of public records, to be as vaporous as the company itself.

But behind these disclaimers is a complex series of connections that, for all three companies, appear to point to the U.S. intelligence agencies and their standard operating practice of ensuring plausible deniability.

Planes and Parts

The latest focus of Narco News investigation into the cocaine planes centers on Planes and Parts Enterprises of Doral, Fla. which is located in the Miami metro area. The company is mentioned by name in a federal criminal case now pending in Miami.
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rainbow4321 Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Aug-24-08 06:27 PM
Response to Original message
7. /

Silver State Bank which held bank accounts for failed Southwest Exchange of Henderson is suing the state of Nevada, seeking to recover damages related to lawsuits over Southwest Exchange.

Southwest Exchange, which had accounts at Silver State Bank, closed in January 2007 owning $98 million to real estate investors and is in receivership.

Attorneys for investors who lost money when Southwest Exchange failed are suing multiple defendants based on claims the defendants have some liability for the losses.


The division should have known that Southwest Exchanges bank accounts were not set up as escrow accounts, the lawsuit said. In addition, the lawsuit said the division should have known that Southwest Exchange bank accounts were illegal because they didnt require a clients signature prior to diversion of a clients money from the bank account.
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TroubleMan Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Aug-24-08 08:32 PM
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8. I remember the great thread here that called it:
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