From: Rick Wittkop
I cannot tell you how THRILLED I am that you are seeking to amend the "grandfather clause" for the SHO listings/Failure to Deliver list.
As a longtime investor, I can tell you first hand that Market Makers in the OTCBB stocks choose to Naked Short those companies which have recently done a "Reverse Split", for example. The Market Makers feel they are "justified" in death spiraling down such vulnerable companies (which is the very LAST thing such a company needs!).
Cetek Technologies Inc. (CTKH: Pinksheets) was one such company four years ago. Huge volume traded, and funny trading patterns, not to mention the vitriol and venom spread by "Internet board bashers", would suggest CTKH was at one time the victim of Naked Shorting.
A problem in recognizing Naked Shorting is this: with a NOBO list, you can determine the Fails to Deliver which occur WITHIN the DTCC, and THROUGH the DTCC...but not...EXTERNAL to the DTCC. External, like the secret external trades which occur between the "Broker Dealers", which they use to "generate volume" and manipulate the price of a stock.
I do not know how to remedy such a problem as "External Trades" which occur outside the DTCC.
But doing away with the (market stabilizing) "grandfather clause" in the SHO...IS A VERY GOOD START in restoring confidence in the most democratic of all investing institutions !.