Senate hopeful Maragos: Cancel Facebook IPO

advertisement | advertise on newsday

Spin Cycle

News, views and commentary on Long Island, state and national politics.


While one Republican candidate for U.S. Senate, attorney Wendy Long, stops on Long Island to meet with Suffolk Republicans and the Conservative Society for Action, rival candidate George Maragos, the GOP Nassau comptroller, has issued remarks on a subject central to his career: investment and finance. He called for the initial public offering for Facebook to be canceled based on reports about the circumstances under which earnings forecasts were downgraded beforehand. Maragos said in a statement:

"The report from Alistair Barr of Reuters said that the three banks underwriting the IPO (Goldman Sachs and JPMorgan, with Morgan Stanley taking the lead) all downgraded their earnings forecasts for the company without disclosing this information to the general public while still conducting pre-IPO marketing. The allegations of insider information regarding the Facebook IPO, if true, violate security laws and may have defrauded millions of investors.

"As the potential fraud is so widespread and millions of small investors may have lost billions, the Securities and Exchange Commission and FINRA should immediately issue orders to cancel the IPO, freeze all accounts of those who sold during the IPO and return all monies to investors. The millions of small investors who may have lost money cannot wait years for the investigations to conclude and justice through the courts. The SEC and FINRA have the authority to act and they must act.
The credibility of the American financial markets is also at stake and must be protected quickly before irreparable harm is caused.

advertisement | advertise on newsday

"The best solution is for the government agencies to cancel all IPO orders, halt trading in Facebook, return investors money and have the company re-file the IPO. The Facebook founders should not be allowed to leave the country with potentially fraudulent gains. "

You also may be interested in: