Overstock issuing phantom stock?

Posted Jul 2nd 2009 4:45PM by Zac Bissonnette
Filed under: Scandals

Here's today's update from the irony department -- special thanks to Sam E. Antar for e-mailing it to me. From a FORM 12b-25 filed with the SEC on June 30th:

"The Company recently discovered that it inadvertently issued more shares of the Company common stock in connection with its 401(k) Plan than were registered on the Registration Statement on Form S-8 (File No. 333-123540) relating to the plan. The Company needs additional time to ascertain the facts relating to this issue and to analyze the effects, if any, on the plan."

This would be a funny little accounting screw-up at any company, but that it happened at Overstock.com (NASDAQ: OSTK) makes it especially hilarious: This is a company whose CEO has complained to anyone would listen of a massive conspiracy to counterfeit shares of his company's stock and then sell them into the market -- driving down the stock price and allowing short sellers to profit.

And now we find out that Overstock itself was issuing shares beyond what had been registered with the SEC!

Of course it's probably not material, and there's no reason to think that it's anything other than an error.

But it's pretty awesome that a company goes around accusing people of selling stock that doesn't exist -- when it's issuing stock that shouldn't.

Tags: inthenews, ostk, overstock.com