Citron Research Says Life Partners (LPHI) Time Is Up
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Citron Research, a noted short seller, published a negative note on Life Partners (Nasdaq: LPHI) today. Citron says Life Partners has had a nice ride, but "...all good things must come to an end, however, and now the final chapter is being written for Life Partners. The SEC and Wall St. have decided to move in on life settlement industry and it is Citron’s opinion that this sea change will be at the expense of Life Partners Holdings."
Citron says Life Partners entire business model is built on the absence of a transparent market for life settlements and LPHI’s financials don’t seem to make sense, but there's more to this one.
After Citron's first report on LPHI, he received many emails from industry insiders explaining that Life Partners operates in the shadows outside the envelope of standard practice for the rest of the industry and Citron believes that game is about to end.
From Citron's post, "Life Partners has had their share of litigation with state authorities, and has historically found room to maneuver in a few states, but the last year has seen even that door rapidly closing. In a disturbing act of silence, Life Partners never disclosed to the investing public the consent order signed the last week of July of this year with the Sate of Florida. No press release – and no 8-K. This consent order restricts LPHI from doing business in Florida, by far the largest state for life settlements, until is registers as a Florida Viatical Provider. As of this date, we have no proof that LPHI has even attempted to register. Lastly, the consent order requires LPHI to pay the State of Florida a fine of $770,000. Why no proper disclosure?"
See full release here.
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Head of Citron
Now, as to Left's own personal history, which should give readers some idea about his character. Back in 2000, the National Futures Association (a regulatory agency watching over the commodities and derivatives markets) found that Left had made "false and misleading statements to cheat, defraud, or deceive a customer". He was barred from "association with and from acting as a principal of any NFA member for three yeras, ordered him to take an ethics training course, and placed restrictions on his activities..." (Source: NFA Case ID# 0253075) Oops. Then there was the little matter of Left being sued for Fraud and Deceit, Negligent Misrepresentation, and Breach of Fiduciary Duty -- a case which he lost and was ordered to pay restitution for. Double oops. So, we have a known short-seller with a previous history of ethics violations and check fraud, who has written three articles loaded with false statements that have been completely discredited
Cute Blog
Time is up? They just reported great earnings. Life Partners Holdings Inc. says it expects to report $29.1 million in revenues for the quarter ended Aug. 31, up 17% over the $24.8 million it reported for the same period last year. For the six months ending Aug. 31, the company expects revenues of $56.5 million, a 15% increase over the $49.2 million for the same period last year.
That's Funny
That's really interesting because I recently read that they now have a Reg-D product so the state registration wouldn't matter anymore. Would it?
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Another short seller trying to control the stock.
Observation on Oct 9, 2009 11:00 AMHay Critron. When your friends have naked shorts, you should at least make some research on the company so you don't sound so obvious. We all know your frinds made a fortune with all the shorts, and you have to publisize these reports to make the quick buck. You know the SEC will not do anything about you. Now anyone else looking at the Citron report. Look at the number of shorts for this company. Then look and see LPHI has a registered product. Then you see that this research company didn't do any research. Then you ask why, next look at the shorts. They are controling this small cap stock in order to make the quick buck. to me it looks like the shorts are going to be caught in a short squeeze very soon.