CV Sciences Inc (CVSI)

[ANIA77]

When one asks questions to learn something, it makes him opposite from being ignorant, no?
Anyway, this scenario doesn't happen often so not many people know about this rule.
I found good link for you that has a lot of good info. It's long but info is repetitive so if you managed to read all, you should have better general idea about it.

https://www.sec.gov/investor/pubs/regsho.htm

Shortly speaking, as you know MMs (Market Makers) job is creating market and make stock liquid. Some MMs represent retail like me or you but some make money trading it back and forward.
Now as you also probably know short selling is when someone sells 'borrowed' shares and they have to be returned/bought back in later on..
There is also naked short selling which happens when MM sells shares that he doesn't own or even doesn't borrow.. he sells shares that don't even exist.. and yes it is legal and happen often through the day but most of the time MMs manage to buy shares back and balance books by the end of the day.. if they do it within I believe 3 trading days, they are still OK.. if they don't do it by then, then there is a failure to deliver securities and tick lands on Finra list.
https://otce.finra.org/otce/otcThreshold
Per Finra regulations they have 13 days to close the position and deliver securities no matter what. Period.
It is not company fault when it happens. It's strictly MMs games.
MMs are allowed to naked short to control pps better so there was no crazy spikes and pps going up out of control.
Yes, they take a gamble if they naked short too much but as we know every tick has pullback after break out so most of the time they do fine and are able to cover. Except I think they lost control here last year when pps ran from $2 to $9.. tick showed up on a list after a few days of rally but instead of pullback it kept going up.. and this is when Citron dropped a tweet and helped out MMs. It's hard to know if Citron was involved in naked shorting or he was just helping out.
I mean I have no idea if there is a way to find out which MM is naked shorting when tick shows up on Finra list.
Well, last year naked shorting at least has a reason =massive break out since pps broke out and went up multiple times so MMs tried to keep it under control.. honestly what I don't understand is why someone naked short now before Q2 when pps was trading steadily above $4 within very small range and small volume. I'm puzzled. It didn't cross my mind to even think to look up Finra until today.. hope it gives you some general idea. I don't know many details but I tried to share what I know as simple as I can