Replies to post #367184 on Digital Brand Media and Marketing Group Inc (DBMM)

[nwtf]

And you have proof of these allegations?

[johnydollar]

Just incase bubba needs more learning.........

Naked" short selling is generally illegal in the United States for all investors, including accredited investors, under the Securities and Exchange Commission's (SEC) Regulation SHO.
Accredited investor status, which relates to an individual's or entity's wealth or professional credentials and allows participation in certain private market offerings, does not grant an exemption from the rules governing short sales in public markets.
Why "Naked" Short Selling Is Prohibited
In a standard short sale, an investor borrows shares from a broker before selling them on the open market, with the intention of buying them back later at a lower price to return them to the lender. The broker is required to "locate" the shares to be borrowed before the sale is executed, which prevents selling shares that do not exist or have not been arranged to be borrowed.
Naked short selling occurs when an investor sells shares without first borrowing them or confirming they can be borrowed, creating a potential "failure to deliver" (FTD) the shares to the buyer by the settlement date (typically two business days after the trade, or T+2). This practice is banned because:
It can lead to an artificial increase in the supply of shares, potentially driving down a stock's price in a manipulative way.
Persistent FTDs can deprive buyers of the rights of share ownership, such as voting.
How Abusive Practices Might Occur (Illegally)
Despite the rules, abusive naked short selling can still occur through deceptive practices that violate securities laws, not because of "accredited investor" status. These illegal methods have been the subject of SEC enforcement actions and typically involve:
Mismarking orders: A broker-dealer might mismark a short sale order as "long" (meaning the seller owns the shares) or "short-exempt" to bypass the locate requirement.
Misrepresenting locates: A seller might deceive their broker about their ability or intention to deliver shares by the settlement date.
When these violations are detected, the SEC and the Financial Industry Regulatory Authority (FINRA) impose penalties on the firms and individuals involved.
For further information on the regulations, investors can refer to the SEC's guidance on Regulation SHO.