TLP: Overstock CEO Cops To "Conservative" Accounting Errors, SEC Probe Requested
It's a big day for Overstock CEO Patrick Byrne. The AP publishes a lengthy look at the company, highlighting its first reported annual profit, as well as noting the criticism Overstock continues to face over its accounting practices. And look, one of those critics, JDA's favorite acknowledged criminal, Sam E. Antar, wrote a love note to Mary Schapiro, asking for an SEC investigation.
The AP's Paul Foy did a deep dive into Overstock. The Washington Post ran the takeout, featuring a portrait of "brash" Byrne, arms crossed and smiling:
Since Byrne took Overstock public in 2002, he has derided Wall Street and faced a series of financial restatements as federal regulators opened a broader inquiry into the company's accounting problems. He's accused financial journalists of aiding the short-sellers that can profit from the company's decline, calling one blogger a "hedge fund towel boy."
Byrne, who owns nearly 30 percent of the company's shares, says Overstock's accounting errors were generally conservative. The latest involved 0.1 percent of revenue and gave the company no advantage, he said.
Byrne also wandered into other business lines, buying a travel company, and introducing an auction service and car and real-estate listings. He even tried to buy a diamond mine.
"He was trying to do too much, but think of it as experiments," said his father, Jack Byrne, a highly regarded former insurance executive who was Overstock's chairman for its first three years. "Every once in a while, one of those experiments hits."
One constant is that in the blogs and in the courts, Patrick Byrne has beat a drum over stock manipulation conspiracies that he says a "captured" media refuses to cover.
Antar gets a mention in the AP story, which notes that he has "flagged many material changes in Overstock's finances that the company didn't disclose to the Securities and Exchange Commission." Byrne shrugs, responding that "it's like hearing Bernie Madoff say I'm a bad guy."
Whatever. Antar isn't hiding anything. And his "Dear Mary" letter comes the same day as the big AP profile:
I respectfully recommend that the Securities and Exchange Commission bring an enforcement action against Overstock.com (NASDAQ: OSTK) for violations of securities laws and retaliation against its critics. Otherwise, the SEC will send a clear message that violations of Generally Accepted Accounting Principles (GAAP), making false and misleading statements to investors, and retaliation against critics who uncover financial reporting irregularities will be tolerated and go unpunished.Antar had a post-script on his blog, saying the AP allowed Byrne "to continue lying to investors" and tossing one more barb back at Byrne: "No matter what Patrick Byrne calls me, I was right about Overstock.com's GAAP violations and the company, its Audit Committee, its management including Byrne, and its auditors were all dead wrong."
See also: Going Concern: Overstock.com Blames Restatements on Accountants