Forum Archive Index - April 2000

[Mike Hudson <MHudson@placemakers.co.nz>]

Back again (do I hear groans ?) now that the pest seems to have gone away.

Out of curiosity about six months ago I filled out a coupon for info from
Atlantic and Pacific Securities. I had a call from a chap in Melbourne who
said he would fax me some info on a company they were keen on, which he did.
The covering letter he sent me suggested that they were brokers who dealt
with institutional investors but who had decided to extend their services to
private clients.

The only word I can use for the info and research he sent me was
"amateurish" It consisted of a photocopy of a brochure for the products of a
company called SKYNET ticker symbol  SKYI.OB (USA) together with a letter
saying that I could buy them for $3.60 versus a market price of just over
$4. The catch was that they were "insider" shares which could not be traded
for a year. This is standard practice for IPOs in the US whereby the
promoters are restricted on selling their shares for a period.

When he called me back I told him that this was the biggest load of crap I
had ever seen and not to bother me again which was the end of it as far as I
was concerned. The shares dropped to $1 ½ within a month and are now trading
at $2 ½. It was the sheer unprofessionalism of the outfit that bothered me
more than anything.

ESAT, Esat Telecom  Group Plc are a large Irish telecom company that also
are quoted on the Nasdaq. They have a share price of $100 and a market cap
of $2 billion. The question your friend has to ask is were the shares
actually purchased and if so whose name are they registered in? 

There are lots of "scam" brokers our there and I am not saying that Atlantic
and Pacific are one of these but I think your friend has a reason to be
concerned. I can only suggest that if he can't get any satisfaction from the
company he contacts the Australian equivalent of the Commerce Commission who
may be able to help.

Good luck
Mike H





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