Article: Part 5 in Series on Illegal Naked Shorting’s Role in Stock Manipulation: Traditional Shorting Compared to Naked Shorting (Both Legal and Illegal)

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Part 5 in Series on Illegal Naked Shorting’s Role in Stock Manipulation: Traditional Shorting Compared to Naked Shorting (Both Legal and Illegal)

Larry Smith

Smith On Stocks, 29 April 2019

This is the fifth blog in the series that I am writing to describe how illegal naked shorting is used broadly and massively to manipulate the stock prices of (primarily small) companies. I have been studying illegal naked shorting for nearly five years and I have found it to be incredibly complex and disturbingly it is widely practiced on Wall Street. My earlier blogs were intended to build a foundation needed to understand future blogs.

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Article: Village Farms International Inc (TSX:VFF): This Famous Investor Thinks it’s a Giant Fraud

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Village Farms International Inc (TSX:VFF): This Famous Investor Thinks it’s a Giant Fraud

Ryan Vanzo, 23 April 2019

Village Farms International (TSX:VFF)(NASDAQ:VFF) stock is riding high from all the cannabis hype. Since 2019 began, shares have exploded higher by more than 300%. The run could be over, however. At least that’s what one famous investor is saying. While you may not have heard of Andrew Left, he is one of the most respected short-sellers today. His firm Citron Research has uncovered countless frauds and scams, profiting handsomely after the stocks take a dip. Recently, Left has set his targets on Village Farms. Here’s what he discovered.
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Article: Part 4 in Series on Illegal Naked Shorting’s Role in Stock Manipulation: Who are the Key Players?

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Article: Part 4 in Series on Illegal Naked Shorting’s Role in Stock Manipulation: Who are the Key Players?

Larry Smith

Smith On Stocks, 17 April 2019

I worked on Wall Street as an analyst for nearly 40 years and was involved in the stock market on a day to day basis. Throughout this time, I was focused on fundamental developments that would give an insight into the potential for a company to grow its sales and profits and then trying to translate that into future stock performance. Like many investors, I believed that this was the overarching factor in predicting future stock performance. I had no inkling and I would have been shocked if someone had told me ten years ago what the experience of the past decade has taught, i.e., in many, many cases (particularly for small companies) fundamentals are not the most important factor determining the stock price.

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Article: Deutsche Bank faces action over $20bn Russian money-laundering scheme

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Deutsche Bank faces action over $20bn Russian money-laundering scheme

Luke Harding, 17 April 2019

Germany’s troubled Deutsche Bank faces fines, legal action and the possible prosecution of “senior management” because of its role in a $20bn Russian money-laundering scheme, a confidential internal report seen by the Guardian says.

The bank admits there is a high risk that regulators in the US and UK will take “significant disciplinary action” against it. Deutsche concedes that the scandal has hurt its “global brand” – and is likely to cause “client attrition”, loss of investor confidence and a decline in its market value.

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Article: German regulator files complaint on alleged Wirecard manipulation

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German regulator files complaint on alleged Wirecard manipulation

BaFin targets two FT journalists and several short-sellers after reports hit payments group’s share price

Olaf Storbeck

Financial Times, 16 April 2019

The German financial watchdog has filed a criminal complaint against two Financial Times journalists and several short sellers, accusing them of potential market manipulation over reports about suspected accounting irregularities at payments processor Wirecard.

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Article: RM LAW Announces an Investigation of Village Farms International, Inc.

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RM LAW Announces an Investigation of Village Farms International, Inc.

PRNewswire, 16 April 2019

RM LAW, P.C. announces an investigation on behalf of Village Farms International, Inc. (NASDAQ: VFF) (“Village Farms” or the “Company”) investors concerning the Company and its officers’ possible violations of federal securities laws. On April 16, 2019, Citron Research published a report titled “Citron presents the Red Flag Why the SEC should investigate Village Farms – Price Target $1”. Following the release of this report, Village Farms’ shares dropped more than 10%.
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Article: Village Farms Investigated by Block & Leviton LLP For Violations of Federal Securities Laws

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Village Farms Investigated by Block & Leviton LLP For Violations of Federal Securities Laws

GLOBE NEWSWIRE, 16 April 2019

Block & Leviton LLP (www.blockesq.com), a securities litigation firm representing investors nationwide, is investigating whether Village Farms International, Inc. (“Village Farms” or the “Company”) (NASDAQ: VFF) and certain of its officers and directors violated federal securities laws. On April 16, 2019, Citron Research published a report titled “Citron presents the Red Flag Why the SEC should investigate Village Farms – Price Target $1”. Following the release of this report, Village Farms’ shares dropped more than 15%. Block & Leviton LLP was recently ranked 4th among securities litigation firms by ISS for recoveries in 2017. The firm represents many of the nation’s largest institutional investors and numerous individual investors in securities litigation throughout the country. Indeed, its lawyers have recovered billions of dollars for its clients.
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Article: Part 3 in Series on Illegal Naked Shorting’s Role in Stock Manipulation – Prime Brokers and the DTCC Have a Troubling Monopoly on Clearing and Settling Stock Trades

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Part 3 in Series on Illegal Naked Shorting’s Role in Stock Manipulation – Prime Brokers and the DTCC Have a Troubling Monopoly on Clearing and Settling Stock Trades

Larry Smith

Smith On Stocks, 11 April 2019

I am not going to attempt to show in any detail how the clearing, settlement and depositing of securities system evolved from the crisis of the mid-60s to what is now a totally paperless, electronic system. But briefly, Congress passed legislation in 1971 for two new service organizations, whose objectives were the speeding up the clearance and settlement process. The Depository Trust Company (DTC) was established as the nation’s principal securities depository, with the mission to convert paper certificates to electronic book entries and to immobilize the paper certificates and keep them in a vault at the DTC. (No more shuttling by messengers.) The National Securities Clearing Corporation (NSCC) was established at the same time to speed up clearance and settlement services.

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Article: Goldman Sachs faces 72 million won fine due to naked short selling

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Goldman Sachs faces 72 million won fine due to naked short selling

Kim Min-jee, 10 April 2019

Goldman Sachs was slapped with fines by financial authorities for illegal short stock selling. According to the Financial Services Commission on April 9, Goldman Sachs India, a subsidiary of Goldman Sachs, was fined 72 million won for making a naked short selling at a meeting of the Securities and Futures Commission held in February.

Goldman Sachs allegedly made naked short selling for 21 Lotte Chilsung Beverage shares and 18 JW Pharmaceutical shares in October 2017 and January 2018, respectively. Goldman Sachs said, “It is a human error.”

In November last year, the committee also slapped a record 7.5 billion won fine on Goldman Sachs International, a unit of Goldman Sachs, on charges of illegal short stock selling. Continue reading “Article: Goldman Sachs faces 72 million won fine due to naked short selling”

Article: State Street CEO Joseph Hooley Made Over $16 Million Last Year.

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State Street CEO Joseph Hooley Made Over $16 Million Last Year.

Allied Progress, 09 April 2019

IN 2018, STATE STREET CEO JOSEPH HOOLEY MADE OVER $16 MILLION. In 2018, State Street Chairman And CEO Joseph L. Hooley Received $16,102,525 In Total Compensation. [State Street, SEC Schedule 14A, 2018] In The Wake Of The Financial Crisis, State Street Settled For $663 Million For Its Role In The Crisis—Including Notifying “Preferred Investors” About The Impending Trouble While Leaving Charities And Retirement Funds “Completely Unaware” Of The Problems. Continue reading “Article: State Street CEO Joseph Hooley Made Over $16 Million Last Year.”

Article: Goldman Sachs affiliate again faces fine for naked short selling

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Goldman Sachs affiliate again faces fine for naked short selling

Bae Hyunjung, 09 April 2019

South Korea’s financial authority has fined a Goldman Sachs affiliate 72 million won ($63,000) for naked short selling, marking the third case of the US-based investment bank facing sanctions here.

The Securities and Futures Commission of the Financial Services Commission judged earlier this year that Singapore-based Goldman Sachs India Investments conducted short selling without securing underlying assets, officials said Monday.

Naked short selling refers to the sale of borrowed shares in order to profit by buying them back at a lower price, but without actually borrowing the stocks first. Unlike short selling, naked short selling has been prohibited in Korea since 2008. Continue reading “Article: Goldman Sachs affiliate again faces fine for naked short selling”

Article: Lyft is threatening litigation against Morgan Stanley, accusing the firm of supporting short-selling

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Lyft is threatening litigation against Morgan Stanley, accusing the firm of supporting short-selling

Deirdre Bosa, Leslie Picker

CNBC, 6 April 2019

Lyft has threatened litigation against Morgan Stanley, accusing the firm of supporting short-selling for investors who are subject to lock-up agreements.

In a letter sent to Morgan Stanley on April 2, Lyft questioned the firm about its alleged role in helping market certain products that would help pre-IPO investors bet against the stock.

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Article: Part 2 in Series on Illegal Naked Shorting’s Role in Stock Manipulation- Conventional Wisdom on How Short Sales are Executed

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Part 2 in Series on Illegal Naked Shorting’s Role in Stock Manipulation- Conventional Wisdom on How Short Sales are Executed

Larry Smith

Smith On Stocks, 4 April 2019

The current conventional wisdom on how a short sale is transacted is that a short seller borrows stock from a specific investor who is long the stock, then at some later point buys back the stock in the open market. They then return the stock to that “same specific investor” from whom it was borrowed. Before I met ShareIntel, this is what I thought happened, but as I began to work with them and to do more research on my own, I was jolted when I realized that this is not what goes on in the real world of Wall Street and in later reports I will address how the actual process facilitates widespread naked shorting that enables stock manipulation by some hedge funds..

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Article: Shopify Shares Fall Fast Following Report From Short Seller

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Shopify Shares Fall Fast Following Report From Short Seller

KEVIN CURRAN, 04 April 2019

Shares fell over 3% after the report’s release, cutting into the Canadian e-commerce company’s 50% gain to kick off 2019. “I still think they are best in class,” Andrew Left, Citron Research’s executive editor, acknowledged in an interview with Real Money. “It’s just that when you have a PE ratio over 300, its being priced like nothing bad can happen.”

He cited the emergence of competition from Square’s (SQ) online store, Facebook’s (FB) Instagram checkout, and the rumored launch of a Microsoft’s (MSFT) shopping competitor, as indicators that could deflate the stock. “This is a company that is priced for hyper growth. If they lose 15% of their base, their multiple is going to get smacked,” Left commented.
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