Predatory Naked Shorters are involved in $CGC's private placement announced yesterday.
BIG RED FLAG: Predatory Naked Shorters are involved in $CGC's private placement announced yesterday: BPY Ltd, Nomis Bay Ltd, and NewGen. They are all connected to Murchinson Ltd owned by Marc Bisticer and his partner Paul Zogala.
The SEC has previously charged Murchinson with violation of short-selling rules:
"uncovered short selling and other illegal trading practices" ... "This was repeated for hundreds of sale orders between June 2016 and October 2017" ... "the firm provided erroneous order marking information on orders of a hedge fund client, marking trades as “long” that should have been marked as short sales, thereby violating Regulation SHO"
Why the fuck is $CGC still doing deals with known naked shorters, allowing them to cover shorts into Private Placements at a discount to the market (risk-free short) and get a free warrant for each PP share?
In 2023, the OSC made serious accusations against them.
Key quotes from the OSC naked shorting accusations:
“accountable for an illegal and abusive short selling scheme that violated Ontario securities law in connection with a private placement by a public company – Canopy Growth Corporation”
“Bistricer created and carried out an illegal and abusive short-selling scheme”
“put up no money of its own. It simply sold Canopy shares it did not own and used the proceeds to pay for the private placement shares”
“For Bistricer’s private holding company, profit was over $1.27 million” in just a few days.”
“The series of transactions ultimately resulted in retail investors purchasing the Canopy shares that were sold short by Saline. The cash the public paid for those shares flowed through Saline to Canopy, as Canopy’s offering proceeds. This was a public offering of Canopy shares. This type of illegal distribution is sometimes called “backdoor underwriting”.
“Saline’s short sales were motivated by the opportunity for virtually risk-free profits”
$CGC management was complicit. In 2017, Canopy's Director lent shares to short sellers and arranged a private placement for them to cover.
"On March 17, Saline (owned by Bistricer) entered a private placement subscription agreement with Canopy and a securities lending agreement with Goldman Holdings Ltd. (GHL), a private company that Murray Goldman, a Canopy director, used to hold his shares. In anticipation of these transactions, Saline sold short 2.5 million Canopy shares in the open market for approximately $26.76 million."
According to $CGC prospectus from Sept 2023, entities controlled by Murchison owned 6% of Common Shares with warrants to double the position and an over-allotment option. They were also involved in $ACRG. They've been naked shorting for years. Now they're back for more with yesterday's $35M private placement.
What. The. Fuck. Is going on here?
