I in no way have all the answers. The problem is that market making is a uncertainty and that the way people describe it can be interpreted many different ways.
1. Can a market maker sell the same share endlessly? The answer is no.
2. Can a market maker sell endlessly shares they do not have in inventory? The answer is yes.
Now looking at question 1 you would conclude controls are in place that do not exist in 2 but reality is, they are the same.
A market maker can technically sell what they do not own all day (naked short) simply because they sold their clients order before they took possession of their clients shares first. On a trade report it is posted as a short and technically it is a naked short for a split second, but the sale is still originated as a long sale with zero short interest intent.
In this stock I have no idea what is taking place so I can not attest to what created the FTD's in the system. I can tell you that under today's reporting structure it is much harder to report fails than it was before. I doubt your 3 billion very much regardless.
I suggest that from here forward, and knowing little of this company, that it be best to refrain from assuming NSS until there is a history of financials in place and an open TA to the share structure. if a company can not provide you with disclosure of basic information in a timely manner, assume the worst to protect you from wrongdoing.
To date, no company confirmed of NSS hid anything. many claiming NSS that hid something however had something to hide - FRAUD.
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