Bingo....thus why during their selling of shares it was on that REG SHO list for 50 some odd days. Man, the theories were flying all over the place during that time(I was one of them at that time too! lol )
As you are probably aware long sales wherein the stock is not delivered timely will also trigger appearance on the threshold list. An equally valid explanation is that this is a classic example of a fraudulent company selling shares faster than they could deliver.