March 8, 2022
I am a retail investor in favor of this rule to increase disclosure requirements of short positions. While I do believe this will be a great step in the right direction towards full disclosure and reporting, I fear this rule proposal could still leave room for further or more frequent disclosures on short positions on bankrupted zombie companies on the OTC market that are used as collateral for bad actors. There is no reason for a company that has been out of business for over a decade to have 500%+ run ups in one day, let alone 5M+ in volume in any given day. These companies are DEAD and should have very little or NO price action, especially given that theyre off limits to the public. Additional short position reporting needs to be added to ensure these zombie companies are not being manipulated illegally for short term collateral requirements. Additionally, monthly short position reporting still leaves plenty of time for short hedge funds to flood the market with synthetics to push a stock price lower, short distort with the help of media affiliates, or hide/distort short interest using complex derivatives. This is a great start to uncovering those bad actors, but I respectfully request that the SEC consider amending this rule to include additional covenants that require frequent disclosure of short positions in illiquid, OTC companies.