An individual, either acting alone or on behalf of someone else, who attempts to devalue a stock by spreading false or exaggerated claims against a public company.
After the stock's price has dropped, the basher, or the basher's employer, will then purchase the stock at a lower price than what he or she believes it is intrinsically worth.
This is an illegal activity that can carry significant legal repercussions.
The basher generally benefits on how effective the negative rumors are, which can dramatically affect a stock's value.
If an investor believes the false claims, he or she may sell off the stock at the higher price before it falls. The basher will then purchase the stock and ride out the gains.
"This scheme is usually orchestrated by savvy online message board posters (a.k.a. "Bashers") who make up false and/or misleading information about the target company in an attempt to get shares for a cheaper price.
This activity, in most cases, is conducted by posting libelous posts on multiple public forums.
The perpetrators sometimes work directly for unscrupulous Investor Relations firms who have convertible notes that convert for more shares the lower the bid or ask price is; thus the lower these Bashers can drive a stock price down by trying to convince shareholders they have bought a worthless security, the more shares the Investor Relations firm receives as compensation.
Immediately after the stock conversion is complete and shares are issued to the Investor Relations firm, consultant, attorney or similar party, the basher/s then become friends of the company and move quickly to ensure they profit on a classic Pump & Dump scheme to liquidate their ill gotten shares
The shorts will hire paid bashers who “invade” the message boards of the company. The bashers disguise themselves as legitimate investors and try to persuade or panic small investors into selling into the manipulation.
This is not every dirty trick that the shorts use when they are crashing the stock. Almost every victim company experiences most or all of these tactics.
The Anatomy of a Short Attack
Abusive shorting are not random acts of a renegade hedge funds, but rather a coordinated business plan that is carried out by a collusive consortium of hedge funds and prime brokers, with help from their friends at the DTC and major clearinghouses.
Potential target companies are identified, analyzed and prioritized. The attack is planned to its most minute detail.
The plan consists of taking a large short position, then crushing the stock price, and, if possible, putting the company into bankruptcy.
Bankrupting the company is a short homerun because they never have to buy real shares to cover and they don't pay taxes on the ill-gotten gain.
When it is time to drive the stock price down, a blitzkrieg is unleashed against the company by a cabal of short hedge funds and prime brokers.
The playbook is very similar from attack to attack, and the participating prime brokers and lead shorts are fairly consistent as well.
Market Data 
Markets 
AI
