Short Interests: Trading halts with an anthrax scam

Trading halts with an anthrax scam

The Securities and Exchange Commission on Tuesday suspended trading in the stock of 2DoTrade Inc., a company claiming that it was testing a disinfectant for anthrax.

The SEC said it had stopped over-the-counter trading in the stock of the Nevada corporation (TDOT.OB), with offices purportedly in White Rock, British Columbia and London. The agency questioned the accuracy of the company’s claims.

“Investment scams that attempt to prey on fears of terrorism are abhorrent,” said SEC enforcement division director Stephen Cutler.

The SEC reminded investors to be particularly skeptical about claims by companies or promoters that say they have a lucrative product that will be helpful in the battle against terrorism.

Markets hot, brokers not

After the Sept. 11 attacks on the World Trade Center and the Pentagon, investors regarded the securities industry with greater favor, according to this year’s Securities Industry Association survey of investors’ attitudes.

“Favorable attitudes toward institutions, in general, went up in the aftermath,” says Hal Quinley, a pollster with Harris Interactive Inc., which conducted the poll.

The poll, conducted between Aug. 23 and Sept. 25, involved interviews with 1,646 investors, each with financial assets of at least $100,000, excluding their home.

After Sept. 11, 72% of the investors polled said they had either a very or somewhat favorable opinion of the industry.

Before the attack, 59% of those polled said that they had such a high opinion.

Meanwhile, investors’ satisfaction with brokers has fallen a bit this year.

Ninety-one percent of investors surveyed this year said they were either very or somewhat satisfied with their brokers, compared with 95% last year.

Exiting gracefully

So much for happily ever after.

James McCall, the superstar portfolio manager that Merrill Lynch & Co. Inc. fought so valiantly for in 1999, made a beeline for the exit doors at the big broker last week amid huge losses in his mutual funds.

Merrill had a hostile legal battle for Mr. McCall two years ago to free the hot stock picker from his former employer, Pilgrim Baxter & Associates Ltd. in Wayne, Pa. The case was settled under undisclosed terms.

A Merrill spokesman confirmed Mr. McCall’s rather hasty departure.

The skinny from the insiders is that Mr. McCall, 48, opted out of Merrill’s asset management group by accepting a voluntary severance package.

Who can blame Mr. McCall for wanting to exit gracefully? His $329 million Merrill Lynch Focus 20 Fund and the $66 million Premier Growth Fund have performed abysmally since they were rolled out in spring 2000.