The Securities and Exchange has expanded its continuing investigation of Bidz.com (NASDAQ: BIDZ) to include
the Company’s co-op marketing contributions and minimum gross profit guarantees.
On February 10, 2009, the SEC started an investigation into Bidz.com's inventory disclosures for possible violations of Generally Accepted Accounting Principles (GAAP) in response to reporting in my blog. According to Bidz.com's latest Q3 2009 10-Q report:
On October 27, 2009, the SEC issued a subpoena to produce documents relating to the Company’s co-op marketing contributions and minimum gross profit guarantees.
Bidz.com is also facing several class action lawsuits alleging securities fraud as a result of issues raised in reports by short seller Citron Research. In addition, the company is facing a class action lawsuit alleging shill bidding on its web site.
Disclosure: I am a convicted felon and a former CPA. As the criminal CFO of Crazy Eddie, I helped Eddie Antar and other members of his family mastermind one of the largest securities frauds uncovered during the 1980's. If it weren't for the efforts of the FBI, SEC, Postal Inspector's Office, and class action plaintiff's lawyers who investigated, prosecuted, and sued me, I would still be the criminal CFO of Crazy Eddie today.
I do not own Bidz.com securities short or long. My research on Bidz.com is a freebie for securities regulators and the public in order to help me get into heaven, though I doubt that I will ever get there anyway. I will probably end up joining other corporate miscreants in hell. In any case, exposing corporate crooks is a lot of fun for a forcibly "retired" crook like me.