IBIZ Technology Corp (fka IBZT)

[Jim Bishop]

That is the April 1 rule.

As many of us have pointed out this new rule will not effect market makers going short in their job of making a market.

Nor will it effect shorts such as toxic funders shorting using their own restricted stock or other holdings as the "borrow"....those types of shorts don't require any covering in the open market.

Will it effect toxic funders shorting against the underlying stock in CD's, warrants etc....who knows...sure hope so.


Notice this:

(c) A clearing firm may request in writing from NASD an initial extension of up to five business days from the documentation requirements set forth in paragraphs (a) and (b) of this rule for any account of a market maker that sells short pursuant to bona fide market making, but only where such short position was taken to facilitate a customer purchase...."

(d) If delivery is not made within 10 business days after settlement date (or such longer period as may be granted by NASD....."

Also: This mandatory close-out requirement shall not apply to bona fide market making transactions and transactions that result in fully hedged or arbitraged positions

Violations will be deemed inconsistent with Rule 2110, Standards of Commercial Honor and Principles of Trade.

http://www.nasdr.com/conrule_2110.htm


What's the penalty for violating Rule 2110? No idea, I haven't found anything on that yet.


That's my take after reading all I've found.