I was hoping to let a week go by without criticizing the SEC. I thought about it a lot, tried to think of something nice to say, but sorry, I just couldn't do it. I remembered that there's an open sore out there, a continuing reminder of everything that's wrong about our securities watchdogs. It can be summed up in two words: Mark Cuban.It's hard to escape Cuban. This guy generates so many headlines nowadays (take a look at the results when you search Google on the term "Mark Cuban." ) and is so generally obnoxious and abrasive, that it's easy to forget a headline that he generated a couple of years ago: Cuban was accused of insider trading. It will surely go down in history as one of the dumbest cases the Securities and Exchange Commission ever brought against anyone since it emerged from the muck of the Great Depression in 1934. To refer to SEC vs. Cuban as a case of "misplaced priorities" fails to capture the majesty of its inanity. It reminds me of the scene in a Pink Panther film in which Inspector Clouseau writes a ticket on a car whose driver has gone in to rob a bank. At its heart is one of the most notorious financing methods ever to rook investors in small-cap stocks, and the SEC has done absolutely nothing about it. I mean, it's not even pretending to do anything. Let's take a look at the SEC complaint to refresh our memories about the horrible things Cuban was supposed to have done. Seems that in March 2004, Cuban made the mistake of buying a substantial stake in a company called Mamma.com (now called Copernic) ( CNIC). Three months later the CEO called him and said that he had some "confidential" information to give him. The information consisted of detailing just how bad a mistake Cuban had made. Cuban was told that the company was engaged in a PIPE ("private investment in public equity") financing. Cuban was teed off, and you'd be too. You see, PIPEs let companies raise money easily -- all they have to do is give their existing shareholders the shaft. If their shareholders are lucky, the companies sell shares at a discount to new investors, diluting the holdings of existing shareholders. If they're not lucky, the companies sell what has come to be known as "death spiral convertibles." These have a lovely feature: Their conversion price declines as the shares fall, making them a "one-way ticket to Palookaville," as Marlon Brando once put it..