August 7, 2006
Gentlemen:
The Reg SHO list has shown that there are a significant amount of failures to deliver that are never corrected.
This is simply unacceptable, and I'm certain that it was no one's intention to let this situation develop and grow as it has. First of all, no FTD's should be grandfathered. That's like saying that all bankrobbers that were not caught before such and such a date should not be persued or prosecuted. There should be no exceptions. This includes the options market makers.
The way things are now naked short selling is enabled by the system. Since it is currently illegal, except for certain exceptions for market makers, it is truly beyond me why the existing laws are not enforced. If I personally sell stock, then I HAVE TO DELIVER IT. It should be the same way for every seller, including the large brokerage houses and hedge funds. To not enforce this law is to enable wrong doing and to hurt the small investor in favor of the large investor. We don't need some minor adjustments with the "locate" rules, we need to force 100% delivery in every instance.
Thank you for the opportunity to express my views. I look forward to changes in Reg SHO that will eliminate naked short selling once and for all.