Mar. 2, 2025
Dear Chairman and Members of the SEC, I am writing to you as a deeply concerned investor and citizen alarmed by what appears to be systemic corruption and manipulative practices in U.S. equity markets, particularly involving abusive short-selling tactics that undermine market integrity and harm retail investors. Over the past five years, companies such as GameStop (GME), AMC Entertainment (AMC), and MMTLP have been subjected to egregious forms of market manipulation, including naked short selling, failure-to-deliver (FTD) schemes, and spoofing, orchestrated by certain hedge funds and market makers. These actors have weaponized regulatory loopholes and technological advantages to suppress stock prices artificially, distorting true price discovery and driving companies toward unwarranted financial distress. Documented Illegal Tactics 1. **Naked Short Selling**: Market makers and hedge funds have repeatedly abused their privileges under Regulation SHO’s “market maker exemption” to create counterfeit shares, bypassing legal requirements to locate and deliver shares. This has resulted in persistent FTDs, synthetic share inflation, and artificial downward pressure on stock prices. 2. **Dark Pool Abuse**: By routing retail orders through opaque dark pools (e.g., Citadel Securities’ internalization practices), lit exchange liquidity is drained, enabling manipulators to control prices via low-volume trading. 3. **Spoofing and Layering**: Algorithmic trading tools have been used to place and cancel fake orders (spoofing) to create false supply/demand imbalances, as evidenced in DOJ cases against firms like Citadel and Virtu. 4. **Media Collusion**: Coordinated efforts between financial institutions and media outlets to publish misleading narratives (e.g., “meme stock” derogation) to panic retail investors into selling. Evidence in Blue Sheets and CAT Data The SEC has the authority to audit blue sheet trading records and the Consolidated Audit Trail (CAT) to expose these crimes. For example: GME: In January 2021, FTDs exceeded 140% of GME’s float, per SEC’s own report. Yet, no enforcement action addressed the clear evidence of naked shorting. MMTLP: The unexplained trading halt in December 2022, followed by the deletion of all MMTLP shares from broker accounts, suggests catastrophic FTDs hidden via “oblivion” tactics. Retail investors have submitted thousands of FOIA requests for blue sheet data, which the SEC has yet to disclose. AMC: Persistent FTDs and a 2023 class-action lawsuit (*Crane v. Citadel et al.*) allege collusion to suppress AMC’s price via dark pool trading. Legal Precedents and Ongoing Cases -GameStop (GME): The 2021 *In re: GameStop Securities Litigation* (Case 1:21-cv-00106) cited Citadel’s payment for order flow (PFOF) arrangement with Robinhood, which restricted buy orders during the squeeze, violating anti-manipulation laws. MMTLP**: FINRA unilateral halt of MMTLP trading in 2022, despite no company-specific news, is under investigation for potential collusion with market makers to avoid settling FTDs. AMC: The aforementioned *Crane v. Citadel* lawsuit details how market makers suppressed AMC’s price via off-exchange trading, violating Section 9(a)(2) of the Securities Exchange Act. A Call for Immediate Action The SEC must act swiftly to: 1. **Enforce Regulation SHO**: Eliminate the market maker exemption loophole and mandate immediate share recalls for stocks with excessive FTDs. 2. **Publicize Blue Sheet/CAT Data**: Provide transparency by releasing trading records for GME, AMC, and MMTLP to expose synthetic shares and FTD chains. 3. **Prosecute Bad Actors**: Hold hedge funds and market makers accountable under Section 10(b) and Rule 10b-5 for fraud and market manipulation. Retail investors have lost billions due to these predatory practices, eroding trust in the fairness of U.S. markets. The SEC’s mission to “protect investors” demands urgent intervention. I urge you to prioritize these investigations and restore faith in our financial system. Respectfully, Teddy Doyle Question, Are you going to look into the Dark Pool abuse, the blue sheets trading and the CAT system? The alleged crime is out of control.