Remember How Naked Short Selling Wasn’t a Big Deal?
Bob O’Brien
Sanity Check via Wayback, 28 January 2009
Bernie Madoff’s brokerage owed $600 million in stock to its clients, that it, well, didn’t actually have on hand, as in the shares were either never delivered to the brokerage, or far more likely, it just, “Desked the trades” – meaning that it took the client cash, represented the securities as having been bought in the market and delivered (via the brokerage statement the client got every month), but never bothered with buying the shares.
Also known as one type of naked short selling.
