PharmaCyte Biotech Inc (PMCB)

[DragonBear]

ohh really you say??? -- follow the link

IB allows Shorting of Microcraps, but that doesn't mean they can ignore FINRA regulations on the margin required for stocks under $5.

Very few Microcrap stock traders are going to have huge equity value in their trading accounts. But again using my previous example, just for giggles, assume one wants to Short 200K shares of PMCB at 0.06. IB will not allow you to Short PMCB unless you have an account equity of: 2.5*200K = $500K. The potential pay off of the Short position is $12K, iff PMCB goes to 0.000/shr. Let's assume that $500K account had a rough week in the real stock market, and lost -$20K of value. Congratulations, IB will issue a margin call, asking for a $20K deposit. Also a PMCB pump causing the stock to go up, could result in a margin call.

So who with a $500K account is willing to undergo a $20K margin call so as to make part of a $12K profit while waiting weeks (months) for a Microcrap scam to go down? When one can go Long in a stock listed in the real stock market, and gain multiples of $12K in under a week or just a day, and avoid any margin call?

What instead happens in Microcraps is the affiliates convert, and dump stock not yet deliverable, due to the TA not having issued it yet, after debt note conversion. It eventually gets resolved. In the meantime the trade is marked as "Short Interest". If a significant increase, forum posts go up warning about the great Short conspiracy. But it isn't retail Microcrap traders with less than $50K in their accounts which is causing the Short Interest to rise.

last time I checked in 2016 they would allow you to short up to 1.3 million shares

And if all shares shorted are in stock under $5, the account value to short that many shares would by definition have to be: 1.3M*$2.5 = $3.25M.