It's been known forever that options market makers were shorting OSTK stock naked as a hedge. At that time they had a legitimate exemption allowing them to do so. When the SEC removed it, they covered.
What's interesting about the documents in question is that the brokerages and the MMs were angry about what was going on; they didn't like it one bit. That kind of puts paid to any theory holding that the practice was common.
And of course now OSTK is in the toilet. Why? Because it's a badly run company. - janice shell
Maybe someone could give the author a grammar lesson. Who cares if he typed "floating" instead of "float". Not the issue. But a decent diversion.
The documents do not appear to support claims that the shorting was the result of a hedge. Looks like fraud committed by the banks and brokers will become more transparent.
News 
Market Data 
Discover 
