Will Kucinich "put" investigation lead to Egyptian rogue financier Anthony Elgindy?

[HamdenRice]

There is a very interesting subthread in LBN about Kucinich's proposed investigation. The subthread begins at post 57 by DUer, eomer. Eomer tries to straighten out an allegation that one or more FBI agents have been indicted in connection with the 9/11 insider trading allegation.

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x3194333#3194587

Eomer points out that this is not exactly correct. An FBI agent was indicted in connection with a very broad criminal conspiracy that involved the a rogue FBI agent leaking confidential information about criminal investigations of certain companies to an oft convicted Egyptian financier named Amr "Anthony" Elgindy.

The story of Elgindy is about as convoluted and almost impossible-to-believe strange as it gets in 9/11 land. I haven't even begun to get through what is returned on Elgindy from Google, but here are a few alleged facts. I hope that this spurs some of our more persistent researchers to pursue this:

Elgindy had been convicted of a number of fraudulent stock schemes and frauds;

Elgindy began working as an informant in prison, wearing a wire as part of an investigation of corrupt prison officials;

After his release from prison, Elgindy appears to have gotten back into finance, and in particular publishing a web based newsletter geared toward short sellers;

At the same time, Elgindy is accused of having close ties to terrorist financing, through his, and his family's, support of Islamic "charities";

Elgindy was involved in assisting the Albanian rebels in Kosovo including helping get visas for some for entry into the US;

Elgindy developed an extremely strange and convoluted relationship with the FBI, in which an agent, alleged to be a rogue agent, provided information about criminal investigations of companies that had stock trading on the markets to Elgindy;

Elgindy publicized these investigations in his website, causing massive short selling against those company targets;

Elgindy himself traded on the FBI supplied information, leading to his liability for insider trading;

The rogue FBI agent claimed that he carried out this criminal conspiracy in order to punish companies that were defauding stockholders -- essentially, that he was engaging in vigilante leaking of information damaging to a company's publicly traded shares;

Elgindy tried to liquidate $300,000 in his children's trust funds on 9/10/01 and publicized his prediction that the Dow would lose 2/3 of its value soon;

When he was prosecuted for insider trading, the federal prosecutor initially alleged that Elgindy had prior knowledge of the 9/11 attacks;

Much of the evidence about Elgindy's prior knowledge was suppressed and/or sealed, and the prosecutor has suggested that the real story has been suppressed;

Elgindy received an extremely harsh sentence of 11 years for insider trading, despite the fact that he believed that he was working for the FBI as an informant.

I think one very serious question is whether Elgindy fed his FBI handlers information about impending terrorist attacks or vice versa or neither. I haven't been able to sort much of it out, but hopefully others can pick this up and flesh it out. Follow the links. They tell a fascinating story of how the FBI and their informants work together in an atmosphere of incomplete knowledge.

[seemslikeadream]

1. Thanks for this!

I would have missed it :hi:

[HamdenRice]

2. Looks like most people are more obsessed with "no planes." But the takeaway is:

1. Elgindy was an FBI informant.

2. Elgindy allegedly had ties to "Islamic" terrorist financing networks, as well as the procuring of visas for Kosovo "Islamic" rebels.

3. Elgindy was accused of having prior knowledge of 9/11 by a federal prosecutor.

4. Elgindy was accused of disseminating market financial projections based on prior knowledge of the 9/11 attacks.

5. Elgindy was a well known source of financial news to "short sellers," which significantly overlaps the "put option" speculators.

[HamdenRice]

3. Holy Crap! Can anyone please help with this??? Identify the "options trading newsletter"???

I followed reprehensor's post on the main Kucinich investigation thread to reprehensor's journal.

There he recounts (in order to dispute) the 9/11 Commission's conclusion that the unusual put option volume in American Airlines was traced to two transactions:

http://journals.democraticunderground.com/reprehensor/43

1. A single U.S.-based institutional investor with no conceivable ties to al-Qaeda purchased 95 percent of the UAL puts on September 6 as part of a trading strategy that also included buying 115,000 shares of American on September 10.

2. Similarly, much of the seemingly suspicious trading in American on September 10 was traced to a specific U.S.-based options trading newsletter, faxed to its subscribers on Sunday, September 9, which recommended these trades.

<end quote>

Here's the problem: Elgindy, who was accused by a federal prosecutor of trading on inside information about the impending 9/11 attacks was the publisher of what can be accurately described a specific U.S.-based short sales (functional equivalent to puts) trading newsletter. Moreover, we know that on the following day, September 10, Elgindy published on his web based newsletter a frantic recommendation to sell short -- the functional equivalent of buying a put option.

WAS ELGINDY'S NEWSLETTER THE US-BASED NEWSLETTER THAT THE 9/11 COMMISSION REFERS TO??? CAN ANYONE IDENTIFY THE NEWSLETTER REFERRED TO IN THE 9/11 COMMISSION REPORT???

Moreover the explanation that the bulk of activity was attributed to a "single U.S.-based institutional investor with no conceivable ties to al-Qaeda" has always bothered me because it simply doesn't reflect how what can be called the signal amplification process works on Wall St.

Saying that the bulk of the transactions were by an unrelated institution doesn't mean it wasn't insider knowledge. Published information and rumors get picked up in the markets and amplified by institutional investors. Elgindy apparently had a large readership of institutional investors. The single institutional investor transaction could have been an investor who needed to buy AMR shares for an innocent reason, read or heard Elgindy's projection (first hand or second hand) and tried to protect his downside by purchasing put options. The institutional investor could have been innocent, even though the information was insider information.

On edit: If the Elgindy newsletter was the newsletter that prompted short selling/put options referred to in the 9/11 Commission Report, did the Commission know that Elgindy was an FBI informant with ties to Islamic terrorist networks?

[JackRiddler]

4. Holy crap indeed - this possibility never occurred to me.

We've known about the "fax newsletter" since it was used in the evasive excuses of the 9/11 CR and SEC to explain a tiny fraction (the airline puts) of the overall reports of possible trading around the world based on foreknowledge of September 11th - but this is the first time I've seen anyone bring up this possibility. Maybe this is what the FBI investigators who suspected Elgindy of foreknowledge were thinking.

More power to Kucinich.

[seemslikeadream]

5. but they were working around the clock

http://www.buzzflash.com/archives/2001/12/BuzzFlash_Archive_121801_0324p.html

German Firm Probes Final World Trade Center Deals

By Erik Kirschbaum

08/06/03: PIRMASENS, Germany (Reuters) - German computer experts are working round the clock to unlock the truth behind an unexplained surge in financial transactions made just before two hijacked planes crashed into New York's World Trade Center on September 11.

Were criminals responsible for the sharp rise in credit card transactions that moved through some computer systems at the WTC shortly before the planes hit the twin towers?

Or was it coincidence that unusually large sums of money, perhaps more than $100 million, were rushed through the computers as the disaster unfolded?

A world leader in retrieving data, German-based firm Convar is trying to answer those questions and help credit card companies, telecommunications firms and accountants in New York recover their records from computer hard drives that have been partially damaged by fire, water or fine dust.

Using a pioneering laser scanning technology to find data on damaged computer hard drives and main frames found in the rubble of the World Trade Center and other nearby collapsed buildings, Convar has recovered information from 32 computers that support assumptions of dirty doomsday dealings. ...

Henschel said the companies in the United States were working together with the FBI to piece together what happened on September 11 and that he was confident the destination of the dubious transactions would one day be tracked down.

"We have been quite surprised that so many of the hard drives were in good enough shape to retrieve the data," he said.

"The contamination rate is high. The fine dust that was everywhere in the area got pressed under high pressure into the drives. But we've still been able to retrieve 100 percent of the data on most of the drives we've received.

"We're helping them find out what happened to the computers on September 11 as quickly as possible. I'm sure that one day they will know what happened to the money."

[Flatulo]

6. Dead link within BuzzFlash

http://news.yahoo.com/h/nm/20011216/ts/attack_wtc_germany_dc_1.html

[seemslikeadream]

8. Convar saved it

http://press.convar.com/pdf/de/Presse_echo_17_12_2002.pdf

[Flatulo]

9. Thanks SLAD! nt

[seemslikeadream]

7. Computer disk drives from WTC could yield clues

http://archives.cnn.com/2001/TECH/industry/12/20/wtc.harddrives.idg/

(IDG) -- A new data-recovery technique could help trace suspicious financial transactions made shortly before the terrorist attacks in the U.S. on September 11.

An unexplained surge in transactions was recorded prior to the attacks, leading to speculation that someone might have profited from previous knowledge of the terrorist plot by moving sums of money. But because the facilities of many financial companies processing the transactions were housed in New York's World Trade Center, destroyed in the blasts, it has until now been impossible to verify that suspicion.

That's where Convar Systeme Deutschland GmbH comes in. The company is helping reconstruct data from hard disk drives found in the ruins of the twin towers. While other data-recovery companies are also involved in the effort, the company says it has a special edge: a laser-based scanning technology developed about two years ago.

Using the technology, "It's possible to read the individual drive surfaces, and then create a virtual drive," said Peter Wagner, a spokesman for the company, a subsidiary of U.K.-based Convar Europe Ltd. "Our competitors mostly work with (magnetic) heads, which is a very tedious process, but also risky."

Because of the fine dust created by the explosions that destroyed the towers, which was driven at high pressure into devices, physically touching the drive surfaces can damage them, he said.

[Laurier]

11. That's at least 100 hard drives that weren't "pulverized" or "dustified"

Interesting.

[seemslikeadream]

10. Elgindy began investing in stocks in 1988,

http://www.onthecanvas.com/elgindy_docket.htm


http://www.signonsandiego.com/uniontrib/20060620/news_1b20elgindy.html

June 20, 2006
Elgindy began investing in stocks in 1988, after briefly attending USC and San Diego State University.
Elgindy's career path took a turn in 1995, when the firm where he was working – Armstrong McKinley & Associates – became the target of a federal sweep of San Diego stock brokerages.
To avoid trial, Elgindy spent 16 months as an FBI informant, wearing a wire in conversations with his then-employer, Melvin Lloyd Richards, and co-workers who were making money by peddling worthless stocks through a network of boiler-room brokerages.
Elgindy's testimony was key to the government's conviction of Richards and several of his confederates. Assistant U.S. Attorney Jasmine Saide wrote that “the government could not have made its cases” without his help.
After the Richards case, Elgindy began ferreting out scam stocks and exposing them with his now-defunct blogs, Dear Anthony, AnthonyPacific and InsideTruth.
Elgindy made millions of dollars by identifying overpriced stocks and short-selling their shares.
“My trading, my timing, my skills at dissecting financial and news announcements for hidden clues and fraud are all blessings that I cherished and guarded,” Elgindy said in his letter to the judge.
Elgindy and his fellow bloggers bought stock in the companies and then slammed the companies on blogs and e-mails in often scatological terms, poking holes in their financial statements and news releases.
As the stock prices fell, Elgindy and other short-sellers reaped the benefits.
Elgindy made enough money to buy a $2.2 million estate in the Encinitas hills as well as a collection of cars that included a Humvee, Ferrari, Bentley and Jaguar.
In the criminal court case, prosecutors acknowledged that most of the companies that Elgindy attacked were scam operations. But they said he improperly manipulated their prices and that he used confidential information in his blogs, obtained from Royer, the FBI agent.

[HamdenRice]

12. Kicked nt

[HamdenRice]

13. Oh well, not a "no-planes" thread, but possibly demolishes 9/11 Commission "put" fantasy explanation

and therefore draws zero attention in the dungeon.

Par for the course.

[AZCat]

14. I'm sorry, Hamden.

I know it angers you that so much attention is paid to topics that arguably have no real purpose while others languish. I don't think this will change any time soon.

[HamdenRice]

17. You're right, sadly

But part of that is that the people interested in investigating the issues I'm interested in have largely been driven away/abandoned this site.

[LARED]

15. I did some research as you suggested

Elgindy tried to liquidate $300,000 in his children's trust funds on 9/10/01 and publicized his prediction that the Dow would lose 2/3 of its value soon;

The odd thing is his did not actually liquidate the funds until 09/18/01. You would think a savvy trader would have timed the liquidation correctly.

When he was prosecuted for insider trading, the federal prosecutor initially alleged that Elgindy had prior knowledge of the 9/11 attacks;

When the prosecutors tried to raise this as an issue they had zero evidence that it was true in 2002. That's why a few judges have not allowed the subject in court. He was convicted in 2005 and there was still no evidence he knew about 9/11 or more importantly that he received that information from Mr. Royer

Elgindy received an extremely harsh sentence of 11 years for insider trading

I believe he was convicted of securities and wire fraud, and conspiracy and extortion.

I think one very serious question is whether Elgindy fed his FBI handlers information about impending terrorist attacks or vice versa or neither.

Perhaps there should some evidence besides an over-zealous prosecutor before you start speculation. Also how come Mr Royer did not cash in on the 9/11 information?

[HamdenRice]

16. Incomplete research

The odd thing is his did not actually liquidate the funds until 09/18/01. You would think a savvy trader would have timed the liquidation correctly.

Wrong. Elgindy apparently did not anticipate that the 9/11 attacks caused the stock exchanges to be closed from 9/11 to 9/17. Therefore his timing was off by hours not days --ie he should have placed his order earlier in the day on 9/10. Once his broker missed the closing bell on 9/10, the earliest the trade could be executed was 9/18, which was what happened. There is a great deal of evidence that many people in the Arab-American community, especially in New York, had heard rumors that an attack was imminent, but not rumors of the exact date, so just because he got the timing wrong doesn’t mean he didn’t have foreknowledge of some kind.

When the prosecutors tried to raise this as an issue they had zero evidence that it was true. That's why a few judges have not allowed the subject in court.

Wrong. Please show us the prosecutors files that demonstrate that he had "zero evidence."

The prosecutors apparently first raised this issue in a court hearing concerning whether Elgindy was a flight risk, and the judge did not allow the prosecutors to introduce evidence on this topic, but that doesn’t mean they had “zero evidence.” In fact, the U.S. attorney in charge of the prosecution of Elgindy, Ken Breen, had specialized in terrorist financing, and in particular, investigating capital markets profiteering based on anticipation of the 9/11 attacks. My guess is that the judge did not allow the prosecution to introduce evidence of 9/11 foreknowledge because it was irrelevant and prejudicial in the case that the government eventually brought – namely insider trading, fraud and extortion. The judge simply said to the prosecutor, you may not introduce any evidence of terrorism, terrorist financing or 9/11 foreknowledge in this case – not that there was no evidence.

I haven’t been able to find a version of the unsealed documents that allege Elgindy’s foreknowledge in a form that will open on my computer, but it appears that that allegation was based on: Elgindy’s long time involvement with organizations that finance terrorism; certain cryptic messages linked to Elgindy on financial chat boards about imminent bio-terrorism and other terrorist attacks; and Elgindy’s attempt to liquidate the trust fund on 9/10 along with the comments he made to his broker as he placed that his order -- that a 2/3 crash of the Dow was imminent.

I believe he was convicted of more than just insider trading.

My mistake. It was insider trading, fraud, conspiracy and extortion. Considering the total amount of damage that the government alleged as around $9 million, and that the companies Elgindy targeted were themselves mostly fraudulent issuers of penny stocks, and that Elgindy claims he believed he was assisting the FBI, it still seems to be an excessive sentence. There is some evidence that the court went beyond the federal sentencing guidelines in imposing the sentence.

Perhaps there should some evidence besides an over-zealous prosecutor before you start speculation. Also how come the rouge FBI guy did not cash in on the 9/11 information?

Not clear what you mean here. The evidence is not just some “over-zealous prosecutor.” There are published reports that Jeffrey Royer, the “FBI guy” testified that he participated in Elgindy’s ring to “prevent 9/11,” but I haven’t been able to find the original documents.


But your questions seem to miss the question I was asking, perhaps because it was not in the OP but downthread. It’s that the Elgindy case seems to show that the 9/11 Commission didn’t investigate or actively covered up the source of the puts and other unusual financial activity. Their explanation is on its face absurd. The 9/11 CR’s explanation basically boils down to two points: some of the activity was the result of a newsletter and some American Airlines puts were in connection with a purchase of shares by an institutional investor.

Anyone with any understanding of the financial markets would have gone further: What newsletter? Was it Elgindy’s? That’s the question I was asking for research help on.

Who were the institutional investors and what information did they have? Why was the institutional investor who bought AA stock hedging (ie protecting himself against a collapse) by buying puts? Their explanation that because an investor was buying shares, it could not have been based on foreknowledge is absurd.

Although involved on one hand with penny stocks, Elgindy had a big audience of institutional investors who read his alarms about an impending collapse of the markets. They are focusing on who made the trades rather than on the source of the information. As JR points out up thread: why did they only look into a tiny fraction of the trades?

The fact that a guy who the feds suspected of terrorist financing, a guy who was accused of having foreknowledge of the 9/11 attacks, a guy who was an FBI informant and was working with a rogue FBI agent, was putting out in the market catastrophic sell signals in the days before 9/11 would be of interest to me if I were on the 9/11 CR staff investigating unusual sell side financial activity in the days before 9/11.

I wonder why it wasn't?

[LARED]

18. ok

Wrong. Elgindy apparently did not anticipate that the 9/11 attacks caused the stock exchanges to be closed from 9/11 to 9/17. Therefore his timing was off by hours not days --ie he should have placed his order earlier in the day on 9/10. Once his broker missed the closing bell on 9/10, the earliest the trade could be executed was 9/18, which was what happened. There is a great deal of evidence that many people in the Arab-American community, especially in New York, had heard rumors that an attack was imminent, but not rumors of the exact date, so just because he got the timing wrong doesn’t mean he didn’t have foreknowledge of some kind.

You mean maybe wrong. What I find interesting is that you are quick to lump Mr. Elgindy in with the many other people in the Arab community that perhaps knew of or heard rumors that something big was going to happen soon, yet as far as I can tell he is the only one you think may have been tipped off by the FBI. How did you figure that out? BTW I agree he clearly could have heard something or had direct knowledge and that was the reason to be liquidating.


Wrong. Please show us the prosecutors files that demonstrate that he had "zero evidence."

Well in The New York Times May 25, 2002. They had this to say;

In a court hearing in San Diego, Kenneth Breen, an assistant United States attorney, said the adviser, Amr Ibrahim Elgindy, tried to sell $300,000 in stock on the afternoon of Sept. 10 and told his broker that the stock market would soon plunge. "Perhaps Mr. Elgindy had preknowledge of Sept. 11, and rather than report it he attempted to profit from it," Mr. Breen said. Mr. Breen, coordinator of the stock market unit of a government task force set up to investigate financing for terrorist groups, offered no other evidence that Mr. Elgindy had prior knowledge of the attacks. ……

A lawyer for Mr. Elgindy said the allegation appeared to be motivated by the fact that Mr. Elgindy is Muslim and was born in Egypt. Senior F.B.I. officials also said they had no evidence that Mr. Elgindy had prior knowledge of the attacks.

That was back in 2002, it is now 2008 and there is still no one prosecuting him or bringing out new evidence.

While you are correct in saying the judge did not allow this issue to be raised in court because it was irrevelant to the case it is still true there has been additional no evidence he had foreknowledge. Of course you likely believe the FBI is covering up for him, to protect themselves, which is of course your fantasy, but the facts are the facts.


There are published reports that Jeffrey Royer, the “FBI guy” testified that he participated in Elgindy’s ring to “prevent 9/11,” but I haven’t been able to find the original documents.

Of the 139 documents I downloaded from Lexus Nexus and a diligent search on the internet none of them indicate the above. Perhaps there are missing because they’re in your mind?


Anyone with any understanding of the financial markets would have gone further: What newsletter? Was it Elgindy’s? That’s the question I was asking for research help on.

Here is what the 9/11 commission report says

“130. Highly publicized allegations of insider trading in advance of 9/11 generally rest on reports of unusual
pre-9/11 trading activity in companies whose stock plummeted after the attacks. Some unusual trading did in fact
occur, but each such trade proved to have an innocuous explanation. For example, the volume of put options—
investments that pay off only when a stock drops in price—surged in the parent companies of United Airlines on
September 6 and American Airlines on September 10—highly suspicious trading on its face.Yet, further investigation
has revealed that the trading had no connection with 9/11.A single U.S.-based institutional investor with no
conceivable ties to al Qaeda purchased 95 percent of the UAL puts on September 6 as part of a trading strategy
that also included buying 115,000 shares of American on September 10. Similarly,much of the seemingly suspicious
trading in American on September 10 was traced to a specific U.S.-based options trading newsletter, faxed to its
subscribers on Sunday, September 9, which recommended these trades.These examples typify the evidence examined
by the investigation.The SEC and the FBI, aided by other agencies and the securities industry, devoted enormous
resources to investigating this issue, including securing the cooperation of many foreign governments.These
investigators have found that the apparently suspicious consistently proved innocuous. Joseph Cella interview (Sept.
16, 2003; May 7, 2004; May 10–11, 2004); FBI briefing (Aug. 15, 2003); SEC memo, Division of Enforcement to
SEC Chair and Commissioners,“Pre-September 11, 2001 Trading Review,” May 15, 2002; Ken Breen interview
(Apr. 23, 2004); Ed G. interview (Feb. 3, 2004).”


It appears this work was done, just not generally available for you to inspect. I know that raises red flags all over the place in your paranoid world view, but it is what it is.

At the end of the day it sounds like Mr Elgindy might of know something and even was the one that published the trade journal the 9/11 commision spoke about, but there is still nothing tying Mr. Royer to providing information about 9/11. Other than your vivid imagination.

[Diane_nyc]

19. I've updated your link. Please update the post number in what is apparently a split-off sub-thread.

To HamdenRice: First, thanks very much for the info.

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=125x195924">You wrote:

Will Kucinich "put" investigation lead to Egyptian rogue financier Anthony Elgindy?

There is a very interesting subthread in LBN about Kucinich's proposed investigation. The subthread begins at post 57 by DUer, eomer. Eomer tries to straighten out an allegation that one or more FBI agents have been indicted in connection with the 9/11 insider trading allegation

When I clicked on the link you gave, I saw the message "This topic has been moved by the moderator of this forum. It can be found at:" followed by a link to http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=125x195924">this thread (or former sub-thread?). Looking at the latter thread, I didn't find a post #57. Could you please take a look at it and tell us the up-to-date post number?

[Make7]

20. This is the (sub)thread being referred to:

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=125x195974#196094

-Make7

[Diane_nyc]

21. So now post 57 of the old thread is now the O.P. of the new, transplanted thread? nt

[Make7]

22. No, I just used a link that opens that first thread to post #57.

This was the thread started in Latest Breaking News:

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=125x195974

The sub-thread HamdenRice was discussing starts at eomer's post #57 - you can scroll down to find it. The link in my prior post was to the same thread but it had an additional anchor in the web address to automatically scroll down to post #57. If you scroll up to the top of the thread using my previous link, you will find that the original post is the same.

-Make7

[Diane_nyc]

23. Thanks very much! nt