Finally, the court held that Ultimate Holdings was used toperpetratea wrong on its creditors, since it was little more than a part of the scheme to inflate the GENI stock, cash it out while at an artificially high value, and let the losses go to the brokerage firms who had extended margin credit to Ultimate Holdings.
Andy Dufresne explained to his friend Red (aka Morgan Freeman) just how easy it is to invent a phony silent partner and perpetrate financial fraud if you know how the system works.