Oct. 08, 2022
October 8, 2022
October 8th, 2022
Vanessa Countryman, Secretary
Securities and Exchange Commission
100 F Street, NE
Washington, DC 20549-0609
Re: Reporting of Securities Loans (File No. S7-18-21)
Dear Secretary Countryman:
I am writing in strong support of rule 10c-1, Reporting of Securities Loans.
When short-selling practices occur in the dark, circumventing their original intended purpose, and 'current' short-sale information is provided long after a position has been entered into, retail investors and other underprivileged investors cannot be aware of the risks that they take on when buying securities. You can understand why this lack of information would represent a problem for all investors who are expected to invest on incomplete and dated short sale information. I vehemently support the intraday 15-minute reporting requirement. The cost and effort involved with this is justified to help in the early identification of abusive shorting practices, reduce toxic market participants' ability to hide behind loopholes, and attempt to prevent such fraud from occurring in the capital markets.
The new rule would also provide any victimized companies a greater ability to defend themselves against predatory short selling as short selling in the dark harms true competition and price discovery. The enactment of this rule would also introduce the ability for the general public as well as public companies to serve as watchdogs for the SEC as an initial line of defense against abusive practices. This would be accomplished by being able to more granularly monitor short selling for securities fraud for those securities they are invested in, helping and strengthening the SEC's ability to fulfill its mandate, and help weed out market participants that are working against SEC rules, all at no additional cost to the SEC.
I am a strong supporter of transaction-by-transaction reporting. Clearly, aggregated reporting is not transparent and provides far too much rope where fraud can (and is) hidden in aggregates. Why should one individual or entity have to suffer a worse execution whilst another individual or entity benefits from a better execution, just because it is more convenient for certain institutions to report their short-selling practices in the aggregate? It is wholly unfair and contrary to the requirement of best execution, so it should be a mandated requirement for transaction-by-transaction reporting.
Sincerely,
Mike B.