Let me try this one more time, because I’m worried that some members of this board may still be in Bofi and are closing their eyes to a deluge of potential problems and saying to themselves that “It can’t be true!” because they don’t want it to be true. I don’t want to feel that I saw this coming and didn’t warn people on my board adequately. (Note that other stocks I follow may have catastrophes too, that I DON’T see coming. I do TRY to let you know though, if I see them in advance.)
I’m hearing (especially on the BOFI board):
Okay, so they are giving insiders huge loans at preferential rates… But other companies give insiders lots of stock options.
Okay, so one of their senior vice presidents is a convicted felon… But his felony doesn’t have anything to do with his Bofi duties.
Okay, so BOFI insiders were connected to two banks involved in the biggest scandals and bankruptcies in California… But that could just be coincidence. It doesn’t prove anything.
Okay, so they are helping this shady company evade banking laws by opening loans for them and selling them the loan after 24 hours… But that’s probably not strictly illegal, and it makes good money for the Bofi.
Okay, so one of their ex-internal auditors is suing the company with a huge list of irregularities… But he’s probably just a disgruntled employee, and someone has already dismissed his complaints.
Okay, so they are hiding risky loans in mortgage warehouse loans, a usually safe category of loans (this came out today)… But it’s not proved that Bofi is doing anything strictly illegal.
Okay, so they are involved with this unlicensed Center Street company that specializes in fix and flip homes… But it’s not proved that Bofi is doing anything strictly illegal.
Okay, so…and on, and on, and on…
Now all this may turn out to be immaterial, and the company may do just fine. Two years from now the price may be much higher than it is now. I’m certainly no banking expert. But anyone who pretends to himself or herself that this is “JUST a short attack,” implying that there’s nothing true about it, is just kidding themselves. OF COURSE it’s an orchestrated short attack!!! That’s no secret. But that doesn’t prove it’s false. Some short attacks turn out to be true, very true, and the company that is attacked goes to zero, or close to it.
Just a word of warning: However this turns out, this is no longer the bank we bought into and respected and were proud of. They may skate along on the rim of illegality without ever falling in, but that’s not where I, at least, want to be risking my money. Just sayin’