Petition to uphold rule 10b-21 as set forth by the SEC, put a stop to Dark Pool Trading, and set appropriate fines for violations.

“Sept. 17, 2008 — The Securities and Exchange Commission today took several coordinated actions to strengthen investor protections against "naked" short selling.” (sec.gov 2008) The Rule 10b-21 is aimed at targeting fraudulent short selling transactions. 
What is “naked short selling”? “Naked shorting is the illegal practice of short selling shares that have not been affirmatively determined to exist.” (Investopedia John Olagues May 28, 2020)

So what does this mean? HF (hedge funds) are put in a position where they can purposely short companies for self profit. The use of “synthetic shares” (shares that don’t exist) gives them the ability to manipulate a particular stock(s). HF also use media outlets to sway the public’s opinion in their favor which can be a easy as reporting a particular stock should be sold or that it’s not a good buy. Individual investors don’t have the money or resources to combat those with big money.

Couple naked short selling with Dark Pool trading. “Dark pools are a type of alternative trading system (ATS) that give certain investors the opportunity to place large orders and make trades without publicly revealing their intentions during the search for a buyer or seller.” (Investopedia James Chen May 21, 2020)  Dark Pool activity needs to cease immediately. This practice is being used for market manipulation and gives a permanent edge to large brokerage accounts vs individuals. This is a form of indiscernible trading that benefits those with a large finical backing. 

Rules pertaining to naked shorting and FTD (failure to deliver) must be upheld and amended immediately. When a FTD occurs large firms simply pay a small fine which in some cases can be .0001 percent of the dollar amount owed. Fines should be scaled and an appropriate to the amount of trades/ money due. Suspensions should be enforced for repeat offenders and trading licenses revoked for repeat offenders.

Individual retail investors, those with 401k & pensions, and the economy at large are affected by these practices. Please sign the petition in support of making trading more transparent and holding those who aren’t following, or upholding, the rules accountable. 

http://www.sec.gov/news/press/2008/2008-204.htm

https://www.investopedia.com/articles/optioninvestor/09/naked-short-selling.asp

https://www.investopedia.com/terms/d/dark-pool.asp