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Comment for Proposed Rule 89 FR 286

  • From: Curtis Higgins

    Comment No: 73249
    Date: 2/12/2024

    Comment Text:

    Time to promote post-trade regulatory
    fixes in US:
    1) Fine$ + margin call$ for FTDs [NO
    waivers at NSC's whiml
    2) Mandatory Buy-In
    3) If buy-in fails, raise offer$ until it
    4) Suspend & close accounts of brokers
    who FTD >3x/month: Sec&Exch Act
    1934, §17A.a.5.(C)

    Please find it in your capacity to protect market participants from predatory naked short selling. This includes but is not limited to greater transparency, eliminating FTDs, enforcing buy ins on FTDs, more active margin calls, and suspending or expelling accounts who consistently violate these goodwill exceptions. Obviously there’s a function to FTDs. A legitimate function that in theory is designed to prevent market back up. But it’s become exploited and subverted to the point where it’s functioning as a method of extracting the most possible amount of capital without actually delivery the underlying security. Constantly rolling these over and delaying the purchase, or blatantly leaving them to never be purchased through other market derivatives like swaps of all different forms.

    Similarly, there is a legitimate function to ATPs/ATSs, but like FTDs, they are actively exploited to suppress real price discovery in favor of hedge fund activity and short sellers personal interests. This exploitation of the market undermines true fairness in the market and lends unfair advantages to short sellers who's main interest involved bankrupting legitimate companies in favor of their own personal gains at the dismay and ruin of investors. By the exploitation of FTDs in conjuncture with ATSs/ATPs, also known as “dark pools”, the short sellers can, and do, use these exploitations to perpetually devalue companies illegitimately. These aren’t the only tactics employed through short sellers, and this is why we need the SEC to act in the interest of household investors. From individuals who buy through brokerages, hold in their own name, or those who hold securities and ETFs through retirement funds and other long term investment strategies geared at retirement or other wealth building strategies.

    Short sellers and hedge funds shouldn’t be allowed to be Market Makers. Market makers shouldn’t be allowed to have partial interests in the direction the market is destined to go. This begs the need for greater transparency. The need for real accountability in the forms of fines that equal a greater amount than what is profited from such activity that includes but not limited to the exploitation of FTDd and dark pool manipulation. Other factors need ti be fixed as well. The list seems to be growing ever longer and that’s before accounting for exceptions made to certain participants. It doesn’t help to make rules if certain contributors are exempt from their rules, assuming these rules are enforced in the first place.

    It’s obvious that these actions are being brought to light at an increasing rate. And it’s astounding that these actions were ever allowed or tolerated from the beginning. We need more activity from our gatekeepers to the market. And that begins with you, the SEC. You have the publics support to act in our best interest. We besiege you to act at our behest and more importantly in our best interest. We will remember those who act in our best interest, and we are ever vigilant to take oversight to the actions that guide these policies, for better or worse. We have become increasingly more active in demanding positive change and we sorely need your help. The sanctity of the United States Financial Markets depending heavily upon your ability to protect investors and enforce the rules against those who look to exploit the sanctity of our markets.

    These actions are becoming increasingly untenable and eventually we will see the negative impacts that will bear financial consequences if these exploitations are not rectified if they continue unchecked. Please hold those accountable to highest standard with no leeway given to any who fail to properly interact within the proper function of our markets. We need to eliminate the secondhand functions of these supposedly legitimate actions that include, but are not limited to FTDs, darkpool activity, mis-marking sales, and skirting the buy ins of securities that are legitimately purchased through brokers, transfer agents, and any who have a fiduciary responsibility to act on the behalf of common investors. We need greater protection for all investors who are considered long investors, and greater accountability for short sellers and hedge funds regardless of their accumulative wealth.

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