Aurora Acquisition Corp (AURC)

[tr8dervic]

About naked shorting...when I was an MM (actually a specialist on the floor, my competition being the other exchanges), we never thought of it as naked shorting. The reality is that 1 or 2 MM's might have the actual bulk of physical orders and everyone else trades off of them. ie: nite, ubss are .34/.35 5000x5000 and you (the MM) get an order to buy 50k at .35. You can pass it off to ubss or nite or execute it right away at .35 against their quote. Most times you just execute right away against the quote and wait for a sell order to come in to even you out. If a seller doesn't show up is where problems start...maybe. Eventually a buy-in notice will be issued by your firm to you and you buy whatever you need to get squared. If whoever you buy from has the same problem they have a few days or weeks to get THEIR buy-in notice. It's like a floating crap game where the buy-in notice keeps changing hands. Think of it like a balance transfer to multiple credit cards with 0% interest for the first 6 months. You can float the same debt for months on end.

Matched trades: there is no requirement to show an order on the pinks or the BB. Market can be .34/.35 and you get an order to buy 50k at .345. You can sit on that order and if a seller comes in for 50k you can execute at .34 and SIMULTANEOUSLY execute the buyer at .345. A 1 1/2% profit instantly with NO risk.

That's the SEC rules right now and there's not much you can do about it other than complain. (which I do a lot). The rules will eventually change in our favor (thanks to our complaints) but understand that it is all legal at the moment and just keep fighting for change.