I will take a very educated guess at this. I have confirmed with the transfer agent, there has been no increase in the outstanding share count since the private placements were added. Those private placements are restricted for at least 12 months.
The float and free trading are actually different numbers. Why?
Well, because the float only accounts for the shares in the market that the public can trade and the free trading include shares in cert form that are "free trading".
Keeping up?
Ok, then. Now, what if a cert holder saw that the stock was moving or thought it was time to cash out his shares? Well, he would take them to a broker who could then use those shares to short against, cover, short again, cover, and then dump the real shares in the market after they cleared.
Makes a lot of sense doesn't it?
Now, I can't say for sure this is the case. However, if there are no new shares in the market, the shares HAVE to be coming from somewhere. Where if not from cert form?
Also, shorts do exists. They are not pink elephants. Unfortunately.
And depositing certs, while waiting for them to clear, provides a great opportunity to short.
All makes some serious sense to me, but what do I know... I just buy shares in a company I can't even see or hold and hope they eventually go up. Almost the definition of insanity if you ask some people.