Daily Archives: May 5, 2010

Thank goodness we no longer do that!

The Times Square bomber was tracked via a chain of phone numbers obtained when we were monitoring muslims coming into the country from terrorist states.

WASHINGTON — Investigators discovered the name of the suspect in the failed Times Square bombing because of a telephone number he provided when he returned to the United States from Pakistan in February, a law enforcement official said Wednesday.

The phone number he gave three months ago was entered in a Customs and Border Protection agency database and came up Monday when investigators were checking the record of calls made to or from the prepaid cellular telephone used by the purchaser — at that point unidentified — of the vehicle used in the failed bombing, the official said.

Only when they matched the phone number did investigators learn that “that was the guy we were looking for,”

The authorities have said that phone received four calls from Pakistan in the hours before he bought the 17-year-old sport utility vehicle for $1,300. When they ran all the numbers tied to that phone through government databases, the only match they got was the number Mr. Shahzad had given when he returned to the United States on Feb. 3 on an Emirates flight.

Because he was coming from Pakistan, Mr. Shahzad was pulled aside for secondary screening upon arrival, the authorities said. After a Nigerian man tried to blow up a Northwest Airlines flight bound for Detroit on Dec. 25, the federal government mandated additional screening for all passengers arriving from 14 mostly Muslim countries, including Pakistan. That program has since been dropped in favor of a more selective screening system.

Our leaders are scared to even mention the “M” word these days, let alone keep an eye on them.


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Greenwich Time covers only the big stuff

Greenwich Time Editorial Board

When Greenwich resident Michael Metter, owner of local radio station WGCH, is arrested at sunrise at his home on Tinker Lane and charged with securities fraud, obstruction of justice and tax evasion, you’d think that would be a story of interest to residents. That’s why I wrote about it at 10:48.

But not Greenwich Time. They did, however, manage to free up a reporter to cover a car fire in Old Greenwich. The fire happened at noon – Metter’s demise occurred hours before. Hmm.

So what else is in our local paper? Well, “Golfers wowed by new pro shop”

And, local chef on television. And a report that a 19-year-old punk has been arrested for the arson at Scusie’s place last winter. This last item would indeed be interesting, if only GT had thought to mention that the arsonist was surely a pawn of the Albanian Mafia that has plagued Valbella’s since it opened, torching it twice now, plus hanging the owner by his heels to extract protection money, but I suppose those indelicate details are too much for Greenwich residents to bear. Too bad – could have been a fun story.

UPDATE: Whoa! Alert Pulitzer! This just (6:21) in: Byram pool readied for summer!!!!


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Violent, crazed Tea Partiers?

Policeman on fire

Nope: Parasitic Greek Socialists


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This keeps up, St. Barts will be affordable next winter

The Euro tanks


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Big whoop

46 Crawford Terrace on a colder day


Two whole contracts today: 

46 Crawford Terrace (NoPo) , asking $875,000, and 16 Highview, Old Greenwich, listed ($1.175) by Bryan Tunney and reported as under contract with a client of Bryan Tunney all in one day. It must be his descriptive prose. 

Those of you with more expensive homes will just have to wait.


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Buhl on SpongeBob Metter

No handcuffs can hold this slippery guy

Feds Charge SpongeTech CEO with Obstruction of Justice in Pump and Dump Stock Investigation

By Teri Buhl
Looks like our local penny stock scammer is in a world of trouble because it’s not just the SEC who’s charged him for securities fraud today but he’s also facing criminal charges. Michael Metter, Greenwich radio station president and CEO of Spongetech was arrested in his Greenwich home this morning by the FBI and IRS for obstruction of justice. The U.S. Attorney says Metter’s partner Steven Moskowitz was also arrested for conspiring to commit securities fraud and faking at least five customers in an effort to cover-up what the SEC was investigating.

But the executives of SpongeTech, who were already facing a civil class action lawsuit by investors who lost money in their alleged pump and dump scheme, are not the only ones the Feds are targeting. Both the SEC and U.S. Attorney complaint list unnamed ‘others’ as being involved in the illegal stock scam. According to people who have worked with the SEC and the FBI as informers in their case, there is also a continued investigation going on into the marketers and stock promoters of SpongeTech and its related party deals.

It’s a move that hopefully shows the SEC, and their partners at the Department of Justice, are drawing a hard line on not only the companies that try to mislead investors but also the outside stock marketers who knowingly release false press statements that materially affect the price of a stock. When asked what the charges will be against the stock marketers Robert Nardoza of the U.S. Attorney’s Office said, “No Comment”. Sources say one of the stock marketers and corporate communicators being investigated in this scam is Great Neck-based Corporate Evolution. SPNG, the ticker for SpongeTech, is currently promoted on Corporate Evolutions website. When a call was made for comment no one answered the phone at Corporate Evolution’s Long Island office.

The Brooklyn office of the U.S. Attorney complaint states that: “beginning in or about early September 2009, the SEC’s Enforcement Division issued subpoenas to various entities and individuals, including Metter and Moskowitz, as part of its investigation of Spongetech. Since then, Metter and Moskowitz allegedly obstructed the SEC’s investigation by fraudulently attempting to fabricate the existence of the five purported customers by (1) seeking to create Internet websites and virtual offices for the customers, (2) furnishing phony purchase orders purportedly issued by the customers, and (3) producing documents they falsely claimed were proof of payments by the non-existent customers.”

This February I reported, at the Greenwich Time, that Michael Metter made false statements during our interview about current sales activity in SpongeTech. Metter had gone on the record to say that Sponge had just landed a national sales order with Walmart for their kids sponge bath product. A Walmart spokesperson latter confirmed that no national order was in their system but only a regional order was made. The DOJ complaint says SpongeTech executives and others grossly overstated sales orders in public filing from January 2007 to May 2010.

Both the SEC and DOJ filed charges today but only the DOJ has the power to arrest. In past cases like this, the DOJ criminal case is allowed to proceed first with the SEC left sitting on its hands. But according to people involved in the present cases, the SEC could be leading the trial this time. The SpongeTech executives will be faced with defending themselves against Rick Simpson, the SEC’s lead trial counsel. Simpson is best known for his 1980’s IPO scam case against ‘Crazy Eddie’ Antar that earned Eddie jail time.

Metter has continually denied the SEC’s allegations and even threatened journalist (including me) for false reporting on his companies’ alleged investor abuse, via a civil lawsuit filed two weeks ago. News of problems at SpongeTech was first reported by Kaja Whitehouse at the New York Post in the fall of 2009, after she saw famed penny stock investor Tim Sykes question the company’s sale [corrected – Ed]. An in-depth investigative report explaining how Metter set up his stock scam was latter published by Greenwich-based investigative reporter Roddy Boyd for The Big Money. Metter and Moskowitz are being arraigned this afternoon and the U.S. Attorney’s Office boasts that they will aggressively pursue all involved in creating the fraud.

“The defendants in this case — Spongetech’s highest corporate officers — are charged
with executing a bold scheme to portray Spongetech as a company that was performing at a level
far above reality,” stated United States Attorney Lynch. “As detailed in the complaint, the
audacity of their scheme was matched only by their obstructive efforts during the course of the
SEC’s investigation. This Office will use all available resources to protect investors from fraud.”

Editor’s Note: Teri Buhl is a freelance investigative journalist. She has written for the New York Post, Trader Monthly, Dealbreaker, Fortune.com, The Atlantic and Greenwich Time.


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Last one out, shut off the lights

California adopts new regulations banning saltwater for cooling nuclear plant, at cost of billion of dollars. New York’s regulators did the same thing last month to the Indian Point plant, which provides 1/3 of the NYC area’s electricity.

Understand that there are no alternatives handy – the people pushing this want to shut the economy down. Maybe they should be considered the enemy, rather than just misguided kooks.

UPDATE: the funny thing is, the same people determined to shut down our power plant also advocate “clean” electric cars. My guess is that these simpletons think that electricity is generated magically by those outlet things they find in their homes.


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This should put an end to SpongeTech’s suit against Teri Buhl

UPDATE: Metter has been arrested, along with the lawyers he used to issue his phony documents, and an international manhunt is underway for the PR firm that collaborated with him. Perhaps they should look in Dubai?

SEC charges WGCH’s Michael Metter with penny stock pump and dump scam. This was, I believe, the story that got Teri fired from Greenwich Time.[Teri Buhl has written that this isn’t so – of course, since she still doesn’t know why she was fired, I choose to believe she was fired for offending someone and Metter, the fat bully, is as good a candidate as any].  Here at FWIW we’ve encouraged Teri to write what she likes and I hope we’ll have her report on this soon. In the meantime, here’s to you, Greenwich Time.

Washington D.C., May 5th 2010 — The Securities and Exchange Commission today charged New York City-based Spongetech Delivery Systems Inc., an affiliate, and five people involved in a massive pump-and-dump scheme that deceived investors into believing they were buying stock in a highly successful company.


–>The SEC alleges that Spongetech CEO Michael Metter and another senior executive, Steven Moskowitz, hyped fictional customers and grossly exaggerated sales figures through dozens of bogus press releases and fraudulent SEC filings to pump up demand for stock in Spongetech, a company that sells soap-filled sponges. After flooding the market with the false information to fraudulently inflate the stock price, Metter, Moskowitz, and Spongetech dumped approximately 2.5 billion shares by illegally selling them to the public through affiliated entities in unregistered transactions. They spent portions of their illicit profits in highly visible sponsorship deals with professional sports teams to further create the aura that Spongetech was a well-known and prosperous business.

The SEC suspended trading in Spongetech stock on Oct. 5, 2009, due to questions about the accuracy of the company’s press releases and SEC filings. In today’s enforcement action, Spongetech is accused of obstructing the SEC’s investigation by producing phony sales documents in an attempt to legitimize the make-believe customers it hyped to the public. The U.S. Attorney’s Office for the Eastern District of New York today announced a parallel criminal action in the matter.

“Spongetech used a menu of manipulative strategies to perpetuate this scheme, including fake sales orders and public statements as well as obstruction of the SEC’s investigation,” said Robert Khuzami, Director of the SEC’s Division of Enforcement. “We will utilize all available means, including referral to criminal authorities, to prosecute those who attempt to thwart our investigations.”

Christopher Conte, Associate Director of the SEC’s Division of Enforcement, added, “Investors were deceived into believing that Spongetech was a successful business, while Spongetech and its senior executives were illegally dumping shares into the market.”

Two of Spongetech’s former attorneys — Jack Halperin and Joel Pensley — and stock promoter George Speranza are also charged in the SEC’s complaint, which was filed in U.S. District Court for the Eastern District of New York. RM Enterprises International Inc., an affiliate through which Spongetech dumped shares, is also charged.

According to the SEC’s complaint, after several years of relatively little business with a single customer comprising the bulk of Spongetech’s limited sales, Metter and Moskowitz began to paint a more promising and misleading picture of Spongetech’s business. Beginning in approximately April 2007, Spongetech issued dozens of phony press releases touting increasingly larger, yet fictitious, sales orders and revenue. The press releases fraudulently exaggerated the demand for pre-soaped sponges by referencing millions of dollars in sales orders, business, and revenue from five primary customers that purportedly accounted for 99 percent of Spongetech’s business, yet none of those customers actually existed.

The SEC’s complaint alleges that Metter, Moskowitz, Spongetech, and RM Enterprises used false and baseless attorney opinion letters by Pensley and Halperin to distribute shares of Spongetech to the public. Metter, Moskowitz, and Spongetech also used false and misleading attorney opinion letters — forged in Pensley’s name and in the name of a fictitious lawyer, David Bomart — which were transmitted to Spongetech’s transfer agents. The SEC further alleges that Speranza created websites and rented unoccupied office space for the fictional customers in an attempt to legitimize them.


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And again

24 Morningside Drive

Here’s a nondescript bit of construction, listed for sale in November, 2008 at $2.195, sold yesterday for $500,000 less: $1.700. Again, sellers can do what they like, but I think it’s silly to carry a house like this for 18 months in a futile attempt to beat the market.

Comments Off on And again

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As the EU bailout is poised on the brink …

The Greeks have shut down hospitals, schools, airports and today have trapped twenty people inside a burning Athens bank. The whole bail-out is based on huge cuts to Greek spending. In the face of these riots would you, as an investor, consider that likely? If not, would you buy the country’s bonds?

Or, if you were a German legislator, would you commit your constituents’ taxes to this plan? Your people must work until 67 before they qualify for a pension – the Greeks work only until 53, and are willing to burn people alive to keep that subsidy. You’ll support them over our own people? I think not.

We’re going to see some interesting times.

UPDATE: Three burned alive, so far.


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God help us

From InstaPundit:

 NATO Commanders Want New “Courageous Restraint” Award to Honor Those Who Avoid Using Their Weapons. If only we’d had this during World War Two.


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You do what you want to but …

So there are dozens of new listings coming on and almost 95% of them are offered at 2007 prices or above. Sellers are delusional. Here’s a typical example:

25 Owenoke Way, RVSD

This Riverside home, assessed at $2.585 million, was listed for $4.050 in 2005. Even in those days, the seller couldn’t get that much so he pulled it from the market and tried again in 2009, this time at $3.3 million. Better, but it just sold yesterday, for $2.350. Some buyer got a bargain, because this is a very nice house, but the seller lost a bundle by insisting on an unrealistic price to begin with.

This is why I almost always refuse to show new listings. The trouble for sellers is, by the time they finally price their houses at a reasonable level, we realtors have long since forgotten they are even on the market.


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So, who’s your agent?

Blowing one's own horn

Email received from a beloved client:

Just wanted to touch base and tell you how much we LOVE the house, the neighborhood, everything! Our friends come to visit and they just would not believe what we paid for the house – they think we had a steal. We just think we were smart enough to choose a real estate agent who understood our brief perfectly and had the integrity to talk us out of some houses we thought were a good option but now we realize why they weren’t.

It’s interesting, though, when people ask us where you work and we mention you work on your own instead of at Sotheby’s or similar, they are immediately turned off. I guess much better for us homeowners: people who prioritize realtors in expensive suits and cars are probably willing to buy whatever those realtors tell them is a good deal (i.e.: the first house they see). That should keep prices up.


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Greenwich buyer sentiment

There’s this email response from a client to whom I just sent an interesting new listing:

Thanks. I think we’ll wait. The financial markets appear to be coming somewhat unglued, as I’m sure you’ve seen. I’ve waited this long, so I’m willing to wait a little longer to see how things play out. Any foreclosure activity that looks interesting?

And from a comment received this morning, this:

For anyone interested in some anecdotal evidence of potential buyers – we’re probably going to be buying a home in the winter / early spring. We could afford to buy now, but (a) don’t think prices are going to start rising anytime soon, so what’s the rush; and (b) most (but not all) sellers are still asking for *more* than they paid in 2004/2005, which we feel is frankly ridiculous.

For those who haven’t checked the real estate site Trulia, it tracks pre-foreclosures as well as bank owned and foreclosed properties. I don’t know what many sellers are thinking, still asking a premium for their houses, when you look in their neighborhoods and see several houses in pre-foreclosure. Personally I think you’re going to see a dramatic schism in sales between newer, fresher housing in stable neighborhoods and these dated homes where sellers still can’t let go of what they think they could have gotten in 2006. We’d be happy to pay up for a nice house in a good location, but I don’t know of anyone who is willing to consider buying then take on a major renovation project just to make the house decent. But that’s us. We’re the turnkey buyers.

UPDATE: Another comment:

This sentiment is growing. I was at an event Saturday night and spoke to one of the principals of Cadre Group, one of the top appraisal firms in CT. He said that 72% of sales in Greenwich are now short sales, and this is not changing. The ones who bought 2004-2008 better wake up. Buyers around here are sophisticated, and bidding accordingly. FYI, this guy from Cadre was on News 12 several months ago with a Greenwich realtor, who denied any of this was happening, even when confronted with the statistics!! Time for guys like that to smell the coffee.


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A musical comedy piece, just to brighten your morning.

From the Bovina Bloviator: The four chord pop song formula,as demonstrated by The Axis of Awesome . The Bloviator adds,

“In the unlikely event you want to know, the four chords in question are the tonic, dominant, submediant and subdominant (I-V-vi-IV).”

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While we wring our hands, real people are trying to solve the problem

40' high oil dome, built in days

BP workers welded this monster together in days and it’s being rushed out to the well. Will it work? Who knows, but I’m hugely impressed by people who can do this stuff.


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