Found on AIM

Post from Wingardienleviosah

I can’t understate how important it is to write to your legislators to push them to inquire about short selling and naked short selling and its effect on the US economy. You can use https://resist.bot/ to do it in less than 2 minutes. Here is a quick template, feel free to add names/edit as you see fit:

As a constituent I am extremely troubled by the behavior of market makers in the US financial sector as it regards the practice of ‘naked short selling’ that has been exposed in recent weeks. Naked short selling is the illegal practice of selling more shares than have been borrowed and that do not exist on the open market in the hopes that the price of the stock goes down and can be bought back at a discount. This is a practice that has grave repercussions for both the health of the market as well as the companies targeted, often resulting in insolvency, bankruptcy and the loss of American jobs.

Per SEC regulations since 2008, participants in naked short selling activities can be charged with a crime. What we have seen over the past 3 weeks in the US financial markets has been a failure not seen since the financial collapse of 2007. Specifically the system is being stressed by overly shorted securities and the actors that allowed naked short positions to be taken as risky bets placed by well capitalized hedge funds. When these bad bets by certain funds did not pan out how they anticipated, they quickly amassed over $70 Billion in losses in the month of January alone, quickly placing the broader market at risk.

In order to prevent the illegal naked short positions from bankrupting the hedge funds that placed these bets such as Melvin Capital and Point72 Capital, market makers like Citadel Securities, brokerages like Robinhood, Interactive Brokers, and clearinghouses like Robinhood Clearing, Apex Clearing, and the Depository Trust Clearing Corporation acted in a variety of ways to prevent the proper functioning of the marketplace in an effort to stave off massive losses. The fact is that these actors should and will inevitably incur large losses from allowing a security to be shorted beyond 100% of the actual existing shares. These actors have taken illegal, highly unethical, and unfair actions to protect themselves.

Please do everything in your power to not let powerful bad actors making poor and risky financial decisions to get off the hook with defrauding the American people yet again. Please direct your attention towards those responsible for the underlying issue of naked shorting and the counterfeiting of shares, and not retail investors. In particular, directing the regulatory bodies responsible for the oversight of a free and fair marketplace to examine the relevant hedge funds, market makers, and brokers regarding their actions around short selling and collusion on price action to contain their mistakes in late January.

The American people want to believe that government still works for them. Naked short selling is a cancer on our markets and our business community. Please do the right thing and speak truth to power on this issue to get to the bottom of how certain securities laws have been breached by bad actors seeking to profit off of the illegal naked shorting of securities. Thank you for your time and attention to this important issue.