Investor Fraud and the Denial of Short Selling
Let’s make something absolutely clear:
When a short seller who actively holds or held a naked short position publicly denies that short selling exists in a stock, they’re not just “being opinionated”—they’re committing investor fraud.
Why?
Because they know better.
They know that someone had to sell those synthetic shares.
They know the trade mechanics behind it.
And they know that many retail shareholders believe their shares are real—when in fact, they may have purchased counterfeit stock created by a naked short seller.
So when those same short sellers go on message boards pretending to be saviors—insisting there are "no shorts," "no manipulation," or "no FTDs"—they’re not just debating. They’re actively deceiving investors about the true risks and structural manipulation that may exist.
This is willful misrepresentation. That’s fraud.
And courts have taken notice in prior cases—where misrepresenting known financial positions or manipulating public narratives while holding undisclosed positions has been viewed as a deceptive practice under securities law.
So the next time someone shows up and loudly denies that shorting is even possible—ask yourself:
Why are they so desperate to convince you nothing’s wrong?
Why are they so angry when someone proposes a dividend or forensic share count?
And what do they stand to lose if the truth comes out?
If they weren’t worried, they wouldn’t even be here.
—Krombacher
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