cudeco(cdu) limited - representations, page-19

Hi CDU'ers

The following is the text of a letter that I posted to Mr. Greg Medcraft, Chairman, Australian Securities and Investments Commission on the 4th August, 2013, concerning CuDeco(CDU) trading on the 4th August,2013.

"Your ref. "CCC11\0338 – CuDeco(CDU) Limited – Trading.

Dear Mr. Medcraft,

I refer to my earlier representations to you on the 1st July, 2013, on the above matter.

I wish to draw your attention to the shorting/churning activity for CuDeco(CDU) Limited securities trading for the month of July, 2013.

This follows up the trading of CDU securities for the months of May, 2013, and June,2013, you can see that shorting/churning continues to decimate the share price of CDU as a consequence of this illegal trading practice.

Therefore, I have provided, hereunder, the details of the daily trading figures for CuDeco(CDU) Limited securities for July, 2013.

This will enable you to see the consistency of the patterns being used at the present time by those shorting/churning CDU securities on the Australian Securities Exchange(ASX)

Number of Number of Percentage of

July, 2013. CDU Traded. CDU Shorted. CDU Shorted. Price Movement.

------------- --------------------- ---------------------- ------------------ ---------------------

1st. 1,306,431 454,863 34% Down 2c.

2nd. 1,412,006 466,232 33% Up 2c.

3rd. 1,182,807 460,556 39% Down 15.5c.

4th. 1,357,944 403,840 30% Up 6c.

5th. 1,386,629 444,685 32% Down 3.5c.

8th. 1,119,166 266,019 24% “ 5.5c.

9th. 1,412,448 466,107 33% Up 2c.

10th. 1,166,459 290,886 25% Down 11.5c.

11th. 958,639 110,535 11.5% Up 9c.

12th. 875,461 70,137 8% “ 0.5c.

15th. 583,149 116,752 20% Down 3c.

16th. 547,848 26,944 5% “ 0.5c.

17th. 601,564 17,192 2.8% Up 1c.

18th. 623,404 29,261 4.7% “ 2.5c.

19th. 1,234,604 90,338 7% Down 5c.

22nd. 1,372,163 116,538 8% Up 3.5c.

23rd. 1,432,325 326,251 23% “ 5.5c.

24th. 914,568 118,915 13% “ 2c.

25th. 1,090,509 215,514 20% Down 14.5c.

26th. 891,288 217,447 24% “ 1c.

29th. 1,021,206 197,348 19% Down 6.5c.

30th. 802,836 198,016 24% “ 3.5c

31st. 887,560 235,078 26% “ 5c.

This has resulted in an average of 1,050,000 CDU securities being traded daily,in July, 2013, along with an average daily 22% of this stock being shorted.

The overall price movements of CDU for the month of July, 2013, was a gain of 34c and a loss of 77c. A net loss of 43c. in the CDU share price as a result of the shorting/churning undertaken.

Aggregate trading of CDU for the three months May, 2013, June, 2013,and July, 2013, revealed the following:

May. 5,297,849 CDU shares traded of which 1,399,012(27%) were shorted.

June. 13,162,693 CDU shares traded of which 3,073,694(23%) were shorted.

July. 24,180,916 CDU shares traded of which 5,340,454(22%) were shorted.


So the daily aggregate trading of CDU shares for the three months of May,June and July was 656,000 of which 150,000 were shorted. This represents a shorting of 23% each day of trading over the period.

The CDU share price has dropped from $3.76 on the 1st May, 2013, to $1.57 on the 31st July, 2013 . A loss of $2.19. This is despite the fact that the Chairman, CuDeco(CDU) Limited has reported publicly that there has been no material change or any other change to the company.

The situation which CuDeco faces, is not uncommon with other stocks. With shorting the entity lending the shares for shorting has no intention of selling the shares, however the entity is aware of the damage shorting does to the share price. The lender of the shorted shares is going to get the shares back later, and in the meantime can pickup more shares at a cheap price, as well as receive a return for lending the shares.

Shorting is a curse to fair trading on the ASX. In the case of CDU, anyone with the knowledge that M&G are selling down their holding, were on to a sure winner in shorting CuDeco.

A forensic examination into CuDeco could be a test case for the whole of the ASX to determine where malfeasance is taking place and, thus enable changes for the system to operate with integrity and fairness,and provide transparency for all shareholders.

The High Court of Australia has unanimously ruled that the buying and selling of shares on the Australian Securities Exchange(ASX)to create or maintain a share price is an offence of market manipulation.

Yours sincerely,

Maxw.."


Referred for the information of CDU shareholders concerned.

Max