Vis Numar Settles.
Jerome Armstrong Pays the SEC $30K to go away.
By Leon H Wolf Posted in Blogosphere — Comments (21) / Email this page » / Leave a comment »
Drudge is reporting that Jerome Armstrong has apparently entered into a settlement agreement with the SEC in which Jerome has agreed to pay the SEC $30K just to go away. By way of reminder, the allegation the SEC brought against Armstrong was that he unethically touted a stock on an internet message board without disclosing that he was being paid to do so.
So, let's review: one of the founding members of the left blogosphere not only got his start in politics by predicting races on the basis of whether "Earley's natal Jupiter (that's being transited by Jupiter), is being dragged down by his south node there as well," he's now settled with the government over charges that he failed to disclose a conflict of interest when the law (as well as a basic sense of ethics) would have required him to do so. As noted at the time, this allegation in particular is troubling because of allegations that Armstrong was engaged in a hype-for-hire scheme in which he failed to disclose conflicts of interest with respect to his political career as well.
Now, lo these many months ago, in the course of exercising his remarkable powers of persuasion to make sure that the rest of the liberal bloggers kept quiet about the whole situation, Armstrong's long-time blogging partner and book co-author Markos Moulitsas said this:
Jerome can't talk about it now since the case is not fully closed. But once it is, he'll go on the offensive. That should be a couple of months off.
Well, it's actually been a year. But the case is apparently fully closed. We eagerly await Vis Numar "going on the offensive" to explain whether he did or did not fail to fulfill his legal obligations to disclose that he was being paid to tout a stock. More Markos:
My request to you guys is that you ignore this for now. It would make my life easier if we can confine the story. Then, once Jerome can speak and defend himself, then I'll go on the offensive (which is when I would file any lawsuits) and anyone can pile on.
Well, folks, the world awaits. Is an "offensive" from Armstrong coming? I mean to say, beyond deleting diaries at MyDD that make reference to the settlement (I am told that the "inflammatory" diary title in question was "Jerome Armstrong Admits Wrongdoing." The Google Cache has not caught it yet.)? Is Kos going to file a bunch of lawsuits now, to clear his name of the charges that the campaigns in question were really paying Armstrong in order to get favorable treatment from Kos? Or will another eerie silence fall over the left blogosphere like it did when this story originally arose?
I have a sneaking suspicion it will be the latter, don't you?
[UPDATE]: I am reminded in the comments that I forgot to mention Vis Numar's explanation for his apparent bizarre faith in Astrology. The bottom line is that it's not exactly something he's disavowing:
Oh yea, on the astrological stuff. I have done the new age type things over the years—life’s never boring that way. Down that line, I dabbled with planets and predictions in the most abstract manner, as one of several different predictive mathematical disciplines, when coming out of finances and into politics during my early blogging days (nobody is surprised that remembers the early 2001 days here), and since then have completely tapered out of it over time. So yea, the cons got me on this one being a little out of the ordinary… It has nothing to do with what I consult with in online political strategy. But hey, like JP Morgan once said, “millionaires don’t use astrology, billionaires do!”
"One of several different predictive mathematical disciplines?" The father of the left netroots, ladies and gentlemen.
UPDATE part 2: The settlement with the SEC is here. The story was originally broken in The Opinionator NY Times blog.
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Nancy Reagan consulting an astrologer ?
How is this going to play out ? A minor eccentricity ? Impairment of judgment ?
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"Those who expect to reap the blessings of freedom must, like men, undergo the fatigue of supporting it."
-Thomas Paine: The American Crisis, No. 4, 1777
OK, so I re-connected with some old friends that saw my name plastered onto the national news as one of those bloggers paid by Dean, and my brother called me at 1 am last night to tell me he just heard my name on Faux News. And obviously, the whole thing became a soundbite for the MM to smear Dean as equaling Bush's payola of Armstrong Williams. Nevermind that it wasn't the case, or that the facts didn't matchup with the accusations, that's just how things playout in the world of television. Personally, I don't own or watch TV; so except abstractly, it's not really something that's engrossed me by its happening. I'm really more interested in how things play out here within the blogosphere.
I looked up the statute that Armstrong is alleged to have violated: 17(b) of the 1933 Securities Act. Apparently he made about 80 blog posts about some Linux stock in the first three weeks it was public, without telling anyone that the underwriters were slipping him allocations of other stocks. The settlement amount ($30K) is pretty close to the amount of illegal profits he's alleged to have made on his sales of those allocations.
Here's the relevant section of the statute:
It shall be unlawful for any person, by the use of any means or instruments of transportation or communication in interstate commerce or by the use of the mails, to publish, give publicity to, or circulate any notice, circular, advertisement, newspaper, article, letter, investment service, or communication which, though not purporting to offer a security for sale, describes such security for a consideration received or to be received, directly or indirectly, from an issuer, underwriter, or dealer, without fully disclosing the receipt, whether past or prospective, of such consideration and the amount thereof.
Sounds pretty straightforward to me. Is Kos really planning to go out and "go on the offensive" to allege that Armstrong has the right to defraud his readers?
It's an article of faith on the Left that people rip off ordinary investors every day of the week through insider trading and other violations of the securities laws.
But in reality, the SEC is one of the few federal agencies that really go out of their way to mess people up. (The IRS only does so through hamfistedness.) You really, really don't want to violate the securities laws. not even in minor ways. Just ask Martha Stewart and Mike Milken.
Is Kos hypocritical enough to try to convince his sheeple loyal readers that securities laws are only meant to nail successful people?
They'll no doubt scream that it was a VRWC vendetta to distract from all the Bush failures etc.
Facts don't matter; only KnownFacts™ do.
This kind of post is a typical tactic of the left. When you can't discredit ideas, discredit the people who espouse them. That is the point of the endless Congressional investigations, it's a means to winning elections without winning arguments. We conservatives should not engage in similar behavior.
The fact that Mr. Armstrong did this has no larger meaning beyond the incident itself and the character of Mr. Armstrong. Certainly the ideas espoused by the left blogosphere are no more or less legitimate because of this incident.
I remember the left using similar tactics regarding the unethical actions of a prominent blogger at Red State as a means of discrediting the entire blog.
The ideas of the left are wrong because they are wrong, not because the person espousing them might have ethical shortcomings.
When the incident you are refering to happened at RS the editors and the readers were quick to do the right thing. Apologies were made, someone took a walk for a while, and no one tried to hide from the issue (unlike MYDDs erasing of posts related to the matter).
On the left (be it this incident or the current TNR debacle) things don't seem to work that way. In fact, I got a kick out the settlement, wherein Armstrong doesn't have to admit to wrongdoing, but the settlement goes on to spell out exactly what wrongdoing Armstrong is found to have wrought.
Besides, I don't hear the leftist ideas being decried because of Armstrong's shortcomings. That may be in your mind.
Au revoir.
"Greater is an army of sheep led by a lion, than an army of lions led by a sheep" - Defoe
of moral high-horsery that is popular with conservatives who simply don't understand politics.
By this logic we are wrong to be against corruption because we are attacking people and not their ideas.
If you want to be a permanent minority party, this is the position to take.
"A man can never have too much red wine, too many books, or too much ammunition." -- Rudyard Kipling
All other debate points aside, I think anyone can agree that "who cares" would be a totally inadequate position to take for what is arguably the leading right blog. It's clearly newsworthy, it's clearly relative to ongoing topics at redstate, it's cleary of interest to redstate readers, justifiably so, and therefore clearly is worthy of a story at redstate.
Whether or not it is a reflection or commentary on the leftosphere at large might be debatable (although I don't agree with you), but I think it's a stretch to suggest the whole incident is not worthy of remark.
Just asking, because that will help put your post in some relevant context; hopefully that analogy makes my point.
What it shows is that Armstrong, at least on this count, has disingenuous tendencies. Now if you have read some of the other things he has written it provides a broader perspective.
People who are corrupt by nature and definition exhibit those tendencies in many ways. In following, it is a sum total of a person's actions that helps others understand their motivations and intent. This is especially true when someone places themselves in the public eye or asks for their trust. Essentially, that is what a journalist, blogger, politician, et al is asking others to do. Hence it is easy to see the newsworthiness; a person who thrives on public exposure and seeks their trust has betrayed that bond. That is not emotional, partisan or misguided; it is an intellectual conclusion.
It adroitly speaks to a person's overall credibility when such behavior is exposed. However, more important is the reaction that person has to such events. Are they seeking forgiveness and looking to atone? That is the ultimate measure of whether the behavior was a moment of weakness, which we all have, or part of their nature. Only time will reveal that eventual outcome. But in the short erm it appears hypocrisy abounds.
"Dulce et decorum est pro patria mori"
Contributor to The Minority Report
by reading something ridiculous.
Look, Kos and Armstrong are not idea men. If you ask them, they will probably tell you this. They are activists. They are involved in the business of getting a particular set of politicians elected. So, it's not really possible to discredit their "ideas" except to say that "Candidate X" (which Kos and Armstrong are pimping) should *not* be elected.
Now, of course, here is the relevance. Part of the original appeal of blogs was the independence, edgy coverage, etc. The main attraction of blogs vs. the traditional media is that blogs were up front about their biases, leanings, and intent. So, when you went to read a blog, you didn't have to sit there and wonder about where the guy was coming from.
In light of this, when the most prominent blogger in the universe (as much as I dislike Kos, I cannot deny him the title) is accused of shilling for candidates without disclosing that he has received compensation for doing so, it harms the credibility of the entire activist blogosphere. Armstrong's settlement is relevant to this because it involves the *exact same behavior* that he and Kos were accused of engaging in when Kos began mysteriously touting the campaigns of centrist Democrats that employed Jerome Armstrong. At the time the story came out, we were promised an explanation that would help us to understand how Jerome was innocent, this was all a big misunderstanding, etc.
I'm now curious to see what that is.
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This kind of liberty is, indeed, but another name for justice; ascertained by wise laws, and secured by well-constructed institutions.
-Edmund Burke
I think it's fair to say that questioning the honesty of the left blogs is reasonable based on Kos attempted coverup, yes?
Perhaps this is not the best forum to question a fellow blogger's integrity?
...was going to be. Oh, well, at least he didn't try to suggest that Leon was gay.
The Fuzzy Puppy of the VRWC. I've been usurped!
Or did he?
I follow politics pretty closely, and this stuff is still off my radar. Sounds like inside baseball to me...
“Republicans believe every day is the Fourth of July, but the Democrats believe every day is April 15.”
-Ronald Reagan
Kos will go on the offense just like he did against the DLC two years ago.