Author: Don Davidson <email@example.com> at Internet
Date: 06/30/2000 10:20 AM
Subject: Raging Bull LOCH Post #94920
The attached letter says it better than I ever could; It's gospel. Can you honestly keep a straight face and look the other way?
CONTACT INFO FOR SEC; RE: OTCBB MM SHORTING...
I urge everyone to contact the SEC to complain about OTCBB Market maker unregulated short sales. I am including contact information and my letter to the SEC. The more investors demand action the harder it is going to be for the SEC to sit back on this one.
RE: File No. S7-24-99.
Jonathan G. Katz
Secretary, Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549-0609
June 28, 2000
RE: Unregulated Short Sales by OTCBB Market Makers
I urge you to consider regulating short sales by OTCBB Market Makers.
At present, OTCBB Market Makers have no reporting requirements whatsoever concerning short sales. Short selling serves many useful purposes in keeping our financial markets in check. However, if it is unregulated it can be subject to massive abuse.
I believe that the values of all OTCBB companies are controlled by the market makers. Because the present rules allow them to naked short a security with no reporting requirement the market makers can continue to short a security indefinitely, essentially betting that they can outlast private investors. If the market maker succeeds in "beating the will" out of private investors, the market maker never has to cover its short position.
I am an active trader with level 2 and I have seen countless abuses by the market makers. Activities which should be criminal are commonplace. I have seen companies report blockbuster earnings and news only to have its share price decline. I have reviewed numerous time and sales reports and have seen day after day of investors buying shares of a security and the price of the security drop lower and lower.
There is no justifiable reason to allow OTCBB market makers to continue to short sell without regulation. There should be reporting requirements as to how many shares each market maker is short and limits should be set so that a market maker cannot continue to short millions upon millions of naked shares.
Please keep me informed as to the status of any proposed regulations.
Very truly yours,