“Not off shore they don't. They can naked short way beyond the OS.“
Another great OTC myth.
No, OTC stocks cannot be shorted “offshore”. Why? Because to trade any US Security the broker must be registered to act as a broker/dealer in the US. It is therefore impossible for some “offshore” brokerage to do so. The only way they can affect any trade is either by being registered in the US or by working through a US registered broker themselves. Either way their clients are subject to Federal Reserve Reg T on the margin requirements. This little “offshore” myth evolved from a practice many many years ago before Reg Sho when some OTCBB stocks would dual list on some scammy foreign exchange like the Berlin Boerse or VSE. Both have since cleaned up their acts long ago and SBFM is not listed on any foreign exchange.
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