Nov. 20, 2021
Dear Gary Gensler, SEC Commissioners, and Staff, I would like to first off thank you for the proposed rule to increase the transparency and efficiency of the securities lending market, this is a topic I have spent much time researching and writing about in the past. I would also like to thank you for the ability to make public comments on the proposed rule. As I am sure you can imagine, I, like many others, have much to say about the topics that are included in the proposed rule. I appreciate the ability to make my comments be a part of official record, instead of being limited to online social media platforms and forums, which serve as breeding grounds for paid bad actors and scripted chat-bot programs that directly cause the detrimental echo chambers that maliciously manipulate the decisions of purposely misinformed masses. I’m not going to be coy about what this proposed rule is in reference too. Anyone who follows finance knows that this is directly related to the issues caused by the continuous catastrophic failures of U.S. financial regulatory agencies. Those failures were the direct cause of the stock market crashes in 1999 and 2008. Those failures also caused the FUBAR situation that has been occurring since January 28th, 2021. Those failures are continuing to negatively affect the lives of every single American citizen. I think it is about time to learn from past mistakes, so that we can prevent future failures, and instead create successes. The first thing I would like to express in this comment is my frustration at the total lack of regard towards protecting individual investors during the congressional, legal, and regulatory proceedings that have occurred as a result of the “meme stock saga,” which began in January of 2021. I want to make this point very clear, I am a grown ass man, I do not care about confetti being used on mobile phone apps. What I care about is the systematic failures and loopholes that exist in our markets that allow for monopolized financial industry power houses to steal from the general public, and prevent new innovation in our business sectors from occurring. It is my firm belief that any elected or regulatory official that directs the conversation away from these extremely serious issues, such as trying to discuss superfluous topics like confetti, is either too incomptent to comment on this subject, or is purposely being disingenuous to prevent positive changes in our markets from actually being enforced. To make it very clear, these are some of the specific questions I want answers to: Why were there 70 million shares sold short on a stock that only had 50 million shares to offer? What happened to the shorted 70 million shares, and, if they were closed, how would it be possible to close the shares without raising the price? What was Kenneth Griffin and Steven Cohen’s combined $2 billion investment into Melvin Capital used for by Gabe Plotkin, if it was not a bailout, and are there pre-audit trails to prove this? Can it be explained why Kenneth Griffin’s former employee and protege, Gabe Plotkin, left the employment of Steven Cohen’s firm in 2014, to avoid insider trading charges, and now again the two, along with Kenneth Griffin, are involved in one of the biggest suspected insider trading scandals as accused by the general public? As Steven Cohen, through a series of shell companies, is an owner of Wata Games, and many other direct competitors to GameStop, has the SEC, FTC, etc. looked into his involvement of the illegal price inflating collectable market trades that have occured, and were originally appraised by Wata Games, sold through Heritage Auction, and bought by Jim Halperin, who is himself a consultant for Wata Games, and the owner of Heritage Auction? As Steven Cohen and Kenneth Griffin routinely use auctions at Sothebys and Christies to artificially raise the prices of artworks and other commodities for specific artists tied to specific galleries and museums, has the SEC, FTC, etc. looked into how their collateral obtained from these assets from art market trades impact their ability to purchase and manipulate stock market prices? If illegal naked shorting is not occuring, then is there a pre-audit trail that proves that the net inventory share balance of long out of the money puts and in the money calls is zero for all shorted shares? If synthetic shares are not being used to suppress the price, then can it be shown that all FINRA mandated transaction IDs match the transactions in the Continuous Net Settlement system, and can it be shown that all open obligations were net zero two days after each transaction settlement date? If Shorting Hedge Funds aren’t using the derivative market and swaps to hide the shorted shares, then why does all of the publicly available hard information, data, and math point otherwise? Why did the CFTC issue an unexpected letter that allows for the delay on the reporting of swap positions until 2023? What was the SEC’s, and any Market Maker’s, involvement with the CFTC in regards to the creation and implementation of that letter? If Kenneth Griffin and Vlad Tenev did not lie to congress, then why does their story of what happened to GameStop at the start of this year constantly change when they are asked about it in a public interview, and why do those interview statements not coincide with the internal emails and documents that point towards collusion between Citadel and Robinhood? Why was a civil class action lawsuit against Citadel and Robinhood dismissed by a judge before any legal proceedings were allowed to occur? Forget January 28th, what caused the extreme volatility that has happened since, such as in mid March, early June, and early and mid November? Why do large investment firms get to make contributions towards media outlets that push the narratives that cause millions of people to have their money stolen through the organized pump and dumps the investment firms establish? Why was CNBC allowed to claim that r/WallStreetbets was pumping $SLV stock right after Jan 28th, when the actual forum posts from the Reddit community members within that forum, at that time, clearly and openly paint a different picture of the complete opposite sentiment, specifically hundreds of posts that showcased Citadel as being the 5th largest investment owner in $SLV, and genuinely concerned warnings on the risk and unattractiveness of the stock due to it being a predatory pump and dump by that firm? Why are large investment firms allowed to have unfair advantages in the market place due to the ability to purchase and use expensive algorithm based software and physical real estate for hardware that is not accessible to the general public? Why is the media being allowed to portray individual investors as the cause of the obviously algorithmic based manipulation occurring on the “meme stock” prices, which can only originate from the large hedge funds and Market Makers that use high end algorithmic software? Why are government officials allowed to own and trade stocks, when there is a clear conflict of interest in their ability to change public policy in a way that benefits their stock portfolios? Those are just a few of the many very pressing questions that I, and many others, have failed to have accurate information and answers be provided to us. In addition, there are also issues of Payment for Order Flow, Dark Pools, Failure-To-Delivers, Blatant Insider Trading, Illicit Derivative Market Options and Swaps Trading, Federal Reserve and Central Banking Oversight, and Predatory Shorting that all need to be addressed in order to protect the individual investor. I, personally, think that the ability for anyone to create purchasing power through insider trading tactics, such as being given fraudulent loans which are backed by assets whose values were artificially inflated by criminal investors using an exuberant amounts of stolen wealth to influence the price of that asset, such as stocks, art, and collectables, needs to be addressed. I think the financial investors who use this tactic, alongside the tactic of purposely and maliciously co-conspiring to short their investment’s competition, for the goal of industry dominance, need to be arrested. However, this issue is more than just about protecting individual investors in the marketplace, it is a national security issue. The failures and loopholes that exist have allowed outside foriegn bodies to infiltrate and manipulate our economic sector. Our dependence on foriegn economies and exchanges has left our entire nation vulnerable to the decisions those foriegn bodies make. Why this has been allowed to occur, and why direct action has not been taken to prevent the intended destruction of our economy, by foreign bodies, is beyond me. The impact these foreign bodies have had regarding the current economic and inflation fiascos, specifically their contribution to the shipyard bottlenecks that are crippling our small business economies, and their ability to influence mass purchases of commodities through algorithm based social media platforms, has already set in motion irreparable damage to our nation. I’m going to be completely honest, I am having a very hard time understanding the logic behind the decisions being made by the U.S. elected and regulatory officials in regards to the topic at hand. I will admit that my judgement on these issues is skewed due to the bias of seeing everyday the impact the failures to regulate a free market causes me, my loved ones, and every other American citizen. I understand that high level officials have to remove emotion from hard decisions. But even looking at this situation from a purely resource management position, it is clear to see that we as a nation are completely misusing and wasting the assets that are the American people. They should not be viewed as a source to siphon money out of, they should be viewed as an irreplaceable tool. One that needs to be serviced and maintained, in order for that tool to be effective. Allowing monopolized financial institutions to steal from the general public is the opposite of maintaining those people. Valuable people, with the potential to create innovative businesses that would bring profit to our country, have died, and continue to die, because of this lack of regard and maintenance. It is obvious to see that we are undoubtedly living in unprecedented times. In past writings I have compared what has been occurring in the present time to the Wild West. We are adventuring into a new frontier when it comes to our financial sector, as seen by the rise of decentralized cryptocurrencies, an increased awareness of investment policies by the public, and unacceptable restrictions that have been forced upon the individual investors who have a right to participate in a free market. Like the Wild West, all of these new frontiers have provided ample space for corruption to set in. And, again, similarly to the Wild West, I believe it is the duty of the U.S. Marshal Service to publicly step in to investigate and hold accountable the extremely serious corruption and crimes that are occuring. It is clear that, despite the many attempts that I, and others, have made to have the SEC, FTC, FBI, Congress, and other regulatory bodies investigate the crimes occurring, no agency is willing, or simply not capable, of being the voice of reason that enforces the laws and regulations that are clearly being broken. If that is the case, it is time to pass it on to an agency that has the power to enforce the law. The U.S. Marshal Service has precedents of overseeing cases of investigation when those cases involve multiple other regulatory and investigative agencies, such as the current topic involves. They have also been used as the preferred agency to investigate serious allegations of white collar crime and fraud when those crimes are committed with the involvement of guns and drugs, and, if I am not mistaken, there are companies being publicly traded on our markets that operate within the production and distribution of guns and drugs, directly tying them to the financial institutions that need to be investigated. Furthermore, the U.S. Marshal Service’s main purpose is to service the federal courts, and that is where the issues that have occurred due to this topic need to be solved. In the courts, during trials, to prove the innocence or guilt of those who have allegedly committed serious crimes, as accused by the vast numbers of the American general public. These trials need to be fair and unbiased, and not overseen by any of the 131 federal judges that improperly heard 685 court cases between 2010 and 2018, in which they or their family members owned shares of companies that were the plaintiffs or defendants in the litigation, or by any other judge that might have a preconceived biased towards any of the parties involved in the court case. Anything less than that occurring is a complete failure to the American people, and history will recognize that, and recognize those who were responsible for allowing that failure to occur. I think the topic of enforcement is something that your agency needs to address publicly, as looking through the proposed rules, I saw nothing discussing how the financial industry is planning on legitimately holding financial criminals accountable for their fraudulent, unethical, and illegal actions. There needs to be prison time. There needs to be actualized financial retribution based on percentage of wealth. There needs to be compensation and justice for the millions of Americans who have routinely been lied to and stolen from. History, through this public record, will show that these issues are being, and have been, brought up by the general public, and failure to comment on them openingly and publicly will only continue to weaken the resolve the American public has towards elected and regulatory officials’ ability, and willingness, to solve the real world issues that affect all of our lives. Please feel free to directly reach out for correspondence with me. Anything I expressed in this comment are my own personal beliefs, and I do not affiliate myself with any other organizations or groups. What has been going on is not okay. This country shouldn’t need young retail investors, like myself, to tell the men and women who are overseeing and controlling our financial industries that they are acting like children, need to grow up, and that we need to solve these extremely serious issues today, not tomorrow. Respectfully, Jason Wendt, MBA