Article: How to conquer synthetic identity fraud

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How to conquer synthetic identity fraud

Carey O’Connor Kolaja, 29 June 2021

“No single organization can stop synthetic identity fraud on its own,” reports The Federal Reserve. “Fraudster tactics continually evolve to stay a step ahead of detection—and the most sophisticated fraudsters can operate at scale in organized crime rings, generating significant losses for the payments industry. It is imperative that payments industry stakeholders work together, share information and keep up with the threat.”

Synthetic fraud is today’s fastest-growing type of financial crime. To make matters worse, up to 95% goes undetected by regular fraud models, as these actors behave, act and look like regular customers that neither the human eye nor highly complex computer vision methods would have detected. Continue reading “Article: How to conquer synthetic identity fraud”

Article: SEC is investigating Japanese investment giant SoftBank for market manipulation

Article - Media, Publications

SEC is investigating Japanese investment giant SoftBank for market manipulation

DUNCAN RILEY, 25 March 2021

The U.S. Securities and Exchange Commission is investigating Japanese telecommunications company and investment giant SoftBank Group Corp. for alleged market manipulation.

Founded in 1981, SoftBank holds a significant share — 21.2% as of 2020 of Japan’s mobile phone subscription market — but is best known in the W est for its prolific investment portfolio. The list of companies SoftBank has invested in is too long to list but notable names include Uber Technologies Inc., Didi Chuxing Co. Ltd., Grab Holdings Inc., Nvidia Corp., TikTok owner ByteDance Ltd. and DoorDash Inc.

Along with operating the world’s largest technology-focused venture capital fund, Softbank has a particular interest in ride-hailing companies. Except for Lyft Inc., SoftBank owns significant minority stakes in just about every other company in the market. When Grab purchased Uber’s Southeast Asian arm in 2018, it was a deal between two SoftBank-funded companies. Continue reading “Article: SEC is investigating Japanese investment giant SoftBank for market manipulation”

Article: Naked Shorting In The Uber IPO: It Couldn’t Happen On A Blockchain

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Naked Shorting In The Uber IPO: It Couldn’t Happen On A Blockchain

Caitlin Long

Forbes, 16 May 2019

The SEC explicitly gave banks a green-light to naked-short securities that are subject to underwriting commitments, such as IPOs. It revealed this in a Q&A about Regulation SHO (available here, Question 1.5).

Continue reading “Article: Naked Shorting In The Uber IPO: It Couldn’t Happen On A Blockchain”

Article: How Naked Short-Selling Helped Support Uber’s Flailing Stock

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How Naked Short-Selling Helped Support Uber’s Flailing Stock

Evan Niu

The Motley Fool, 15 May 2019

The public debut of the largest ridesharing company, Uber (NYSE:UBER), has not gone well. Widespread investor pessimism over the sustainability of ridesharing economics helped push shares down after going public last Friday, following the IPO pricing at the low range of expectations. An estimated 81% of the equity capital that Uber raised in the private markets is now sitting in the red, according to Axios.

Uber’s underwriters were apparently so concerned about the debut that they made a rare move: naked short-selling.

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Article: As Morgan Stanley’s “Nuclear Option” Failed, Uber Stock Plunged

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As Morgan Stanley’s “Nuclear Option” Failed, Uber Stock Plunged

ZeroHedge, 14 May 2019

Uber’s underwriters, led by Morgan Stanley, were so (rightfully) worried that the company’s IPO was going to crater in the days after its public offering, they deployed what CNBC is calling “a nuclear option” and shorted IPO stock naked, even beyond the traditional greenshoe. Of course, anyone in the industry would simply call this “selling to the dumb money ahead of an obviously overpriced IPO,” but we digress.

This naked shorting is utilized as a tactic to “support the stock” in addition to the usual 15% greenshoe that underwriters overallocate just so they can cover into, if the stock is plunging, with hopes of stabilizing the drop (Morgan Stanley was also Uber’s very much ineffective stabilization agent). CNBC referred to the short covering as “a technique that goes above and beyond the traditional help a new offering can get.”

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Article: Uber underwriters worried about the IPO deployed unusual ‘naked short’ tactic to support the stock

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Uber underwriters worried about the IPO deployed unusual ‘naked short’ tactic to support the stock

Leslie Picker, Hugh Son

CNBC, 14 May 2019

Uber’s underwriters, led by Morgan Stanley, were so worried the company’s initial public offering had run into trouble, they deployed a nuclear option ahead of the deal last week, so they could provide extra support for the stock, four people with knowledge of the move said.

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Article: Investors Psyched To Learn That Morgan Stanley Was “We Need A Naked Short”-Level Of Confident As Uber IPO Approached

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Investors Psyched To Learn That Morgan Stanley Was “We Need A Naked Short”-Level Of Confident As Uber IPO Approached

Thornton Mcenery

Dealbreaker, 14 May 2019

Uber’s appeal as a public company at this stage of its life has always been a mystery to us, yet even we are a little shocked that the bankers taking it to market were so sure it was priced to drop that they went through the trouble of building a naked short into the IPO and then sold that decision to investors as what we can only define as “Dipshit Insurance.”

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