SEC Races Against Short Sellers
Julie Satow
The Sun, 16 September 2008
In an attempt to stanch the bloodletting on Wall Street, the Securities and Exchange Commission will rush to institute new rules as soon as this week to curb abusive short selling of stocks.
The rules — which are far less sweeping than restrictions the agency temporarily instituted in July on shorting shares of 19 financial firms — will make it fraudulent for traders to mislead brokers about whether they have located a stock they intend to short, and will no longer allow options traders to bet against a stock without borrowing it first. It will also require brokers to close out their short positions sooner.
