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.
I explicitly support the 15-minute reporting requirement. This cost is necessary to prevent fraud and loopholes. Retail will benefit from increased transparency. This rule would allow retail investors to have a much better idea of the risks associated with their transactions if which companies are being targeted is made public knowledge. When funds are allowed to short in secrecy, retail investors remain dangerously unaware of the risks they take on when purchasing securities. More frequent reporting allows for more frequent reactions. Less frequent reporting prevents retail investors and working families from protecting themselves from predatory short-selling. Working families and individual investors deserve to be able to view this data in order to make informed decisions.
A short seller is not an investor, but in fact the opposite. The SEC seems to prioritize hedge fund comfort and profiteering over investor protection and market transparency. Short sellers fear \"short squeezes\" that can follow the exposure of their short selling strategy, but this isn't a reason for the Commission to decide against greater transparency. If short selling is more tightly regulated and reported on through this rule and others focused on short selling, such \"short squeezes\" and dangerous volatility will become less commonplace. Wall Street will quickly come to understand that positions that could result in such dangerous volatility, which would be a significant benefit to the market overall.
There are significant dangers inherent in long, untracked lending chains that lead us toward economic fragility. Securities lending activity can hide massively destructive chains of obligation that can even become so large to even become an issue of national security. Transparency in this area is more important than ever before. The risks associated with reckless securities lending and short selling go far beyond any theoretical benefit of short selling. This is highlighted most clearly when examining the events of January 28, 2021. Investor protection should come first.
Sincerely,
A Concerned Investor