Saturday, April 25, 2020 2:57:27 PM
In the interest of protecting investors against fraud, the SEC may have inadvertently creating a short feeding frenzy in the OTC. Any stock that is suspect to any one of a number of leaders of stock chat sites, social media, or discussion bulletin boards is now the target of "shorting in anticipation of" the SEC suspending trading. The inordinate amount of companies that have been suspended recently for suspected fraud related to COVID-19 is ample evidence. It would be quite easy to create a negative smear campaign with just enough evidence to look credible, and with backing from the SEC, appear to be doing the world a favor by weeding out fraudulent companies in this time of international crisis. Sympathy would abound.
It would be interesting for the SEC to investigate large short trades associated with all of the suspended companies to see if there is a pattern or a certain trader or group of traders shows up consistently. social media posts, especially "That One Guy" who keeps "calling" the suspensions. The results may be very enlightening.
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