Naked Short Seller

Naked Short Seller

An investor who sells shares that he/she has neither borrowed nor made arrangements to borrow. Under Regulation SHO, naked short sellers must abide by a "locate" requirement and a "close-out" requirement. The locate requirement forces brokers to have reasonable grounds to believe that the short-sold security can be borrowed; the broker must document this prior to the security's sale. With some exceptions, the close-out requirement means that brokers who have failed to deliver a short-sold security for 13 days must purchase similar securities and present those instead. Naked shorting is very high risk.
Mentioned in ?
References in periodicals archive ?
Additionally, if you purchased shares from a person engaged in naked short selling, you have what might be called "phantom shares" - the shares do not exist since the naked short seller sold shares he did not own.
If a naked short seller does not borrow the stock he sells, he will be unable to deliver that stock to the buyer to settle the trade.
org/wiki/Self-regulatory_organization) The company management feels that Pink Sheets should remain neutral and not punish any company with the "traffic signals" once the company has identified a naked short seller publicly or when the company issues a forward guidance report to its shareholders.
To that end, with respect to the stocks of our client companies, including HTDS, and LDSR Mina Mar will offer a $10,000 reward for information leading to arrest and prosecution of a criminal manipulator, a $5,000 reward for information leading to the punishment of a naked short seller, and a $1,000 reward to find out the identity of any person defaming its clients while not identifying themselves.
Creating the obligation that if a naked short seller fails to deliver a share, the broker-dealer must force a mandatory buy-in (as is done in civilized countries, such as Canada);
Naked short selling is simply the short sale of a share that does not exist (as opposed to "short selling" where the actual shares do exist) in hope that the price will go down, allowing the naked short seller to find and then buy stock at a lower price to fill his short order.
Naked short sellers can list an OTCBB or OTCQB traded company on the BBSE in order to delay delivery of shares under the short position.
Shares are often unavailable, however, for securities that are most popular with naked short sellers.
This unlawful stock manipulation must be stopped to preserve the integrity of our financial markets and provide an honest environment in which public companies can flourish or fail on their own, without the unlawful interference of naked short sellers.
These naked short sellers profit by repurchasing the stock following the downturn.
SHO list for the last 70 days, indicating naked short sellers have failed to deliver shares on settlement dates in blatant violation of U.
OTC:ETMO) ("Extreme" or the "Company") is appealing to shareholders to participate in an effort management believes will significantly increase shareholder value and create a "share vacuum" for illegal naked short sellers.