Replies to post #19527 on Hemi Energy Group Inc. (fka HMGP)

[xtrapink]

I suppose that for the Naked Shorters it is a matter of risk-reward. And as long as the SEC rules are enforced spottily and the penalties consist of finite fines...the risk-reward ratio will continue to favor the practice.

Strict enforcement--Jail Time and Open Ended Penalties in addition to civil liability are all needed to stem the problem. (Way too late to nip it in the bud).


JMO
xtrapink

[BonelessCat]

Yes, that is also what I've read and heard. The SEC doesn't have enough people to watch the Big Board and NASDAQ much less any of the otrher exchanges and their agents.

One would think that the SEC would have an oversight group with a ratio of at least one ispector for each brokerage with market makers in NASD. This would not be costly. At this level of startup, the approach is buyer beware since the vast majority of pinks are non-reporting and/or non-filing. The real concern should be activities of the MMs that unduely add to the risk, as well as harm legitimate startups. Once oversight was established for brokerages, then those same teams could also focus on blatant fraud, especially by EDGAR filing management who are bound by regulations to accurately and honestly report.

I guess such a solution would be just too simple. Instead they create complex rules with wiggle room fine print and leave the elephants in charge of the peanuts.

[lowman]

I don't buy that excuse, myself. The DEA is not short on funds because they go out and bust smugglers and dealers whose money and possessions further finance DEA operations.

The same thing could apply in the stock market.

As a matter of fact, they might find additional funds if taxes from the increased taxable income from investors/traders (who were no longer filing near as many tax losses) were directed towards them (the SEC).

Also, I imagine these large Market Makers probably find ways to avoid heavy taxation, just like they avoid naked shorting laws, taxation that in the hands of the small investors/traders, would probably get paid.