Today I Want to talk about how the Dtcc is working with the Shore to try and protect them and to try and prevent the mother of all short squeezes? Those Sfts or Securities financing transactions were created not to give the shorts cash to pay for the Moas, but actually for the Shorts to borrow more shares from other institutions. So stay tuned and let's make some money. And now I'll drive straight in with the key information. So seven for one Trey Posted this extract but said but you're probably right I'm probably just another conspiracy theorist because surely there's no way the SEC would approve another Bernie Madoff scam And surely there's no way the SEC would protect shorts, right? Well, you may remember that regulation created in 2021 to set up Sfts or Securities financing transactions.

That's where institutions hedge funds Banks or anybody else could lend Securities at face value for cash. They suggested that would be done to try and prevent any kind of fire sales AKA When the market crashes, Instead of these hedge funds Banks and institutions having to dump their shares falling in value, they can effectively just lend them out for face value and receive that cash to pay and to meet any margin requirements. They had hoped that I'd prevent any kind of fire sales prevent a market crash from exponentially worsening. But actually, the secret to Sfts is much worse.

This extract says Sfts involve the owner of Securities who are typically a registered Investment Company pension plan Sovereign Wealth fund or other institutional firm transferring those Securities temporarily to a borrower in return for the lent Securities the borrower transverse collateral and a net rate payment as well as interest on any cash collateral too. And it says the Nscc understands that Sfts provide liquidity to markets and facilitates the ability of Mark participants to make delivery on short sales and thereby avoiding failure to delivers naked shorts and similar situations. So we can see that actually, instead of Sfts being lent out to prevent a market crash or fire sale scenario, it actually just makes it easier for those funds to short more. Securities Because the Sfts or the lending of those Securities provide liquidity to markets and facilitate the ability for those short sales.

So it seems the DTC is actually making new rules to make it easier for Shorts to locate more shares, creating an entirely new role and an entire group of people specifically designed just to lend out. Securities It's funny how this ruling has now come full circle. I Remember talking about Sfts back in 2021 I Said this ruling isn't necessarily good, but it shows the hedge funds are scared and these institutions are in trouble. Little did I know that they're not just in trouble having to lend out those shares to prevent Market crashes, but they're having to lend out those shares to locate even more shares to shore.

But as Bighams has tweeted, it seems the Dtcc only really protects the big boys. and if you're not part of that big boys club, the Dtcc and the SEC will catch you. This article says the US regulator has slapped a trading firm with a 1.7 billion dollar penalty for defrauding thousands of victims. The Cfdc is visiting a South African Bitcoin trading and networking firm with a ban and a 1.7 billion dollar penalty if you didn't realize this is a larger penalty than many of the big boys like JP Morgan Goldman Sachs Citadel and others pay on a regular basis.

Not only that, but this firm has also been banned from the markets altogether, something we've never, ever seen happen to those big market makers. Even though 1.7 billion dollars as a fine may not sound colossal, it's actually every single penny this trading firm stole and more. Imagine Citadel having to pay hundreds of billions of dollars for the money they've stole and more. This is the Cfdc.

See: this firm collected at least 29 000 Bitcoin worth over 1.7 billion dollars for his crimes. He must pay more than 1.7 billion dollars in civil monetary penalties the highest in any Cftc case. Don't get me wrong, it's good this firm has been caught and ordered to pay back every single penny they stole. But I Just wonder when it's going to be the Big Boy's turn to pay back every penny they've stolen.

As Charles Payne pointed out, it's likely this guy was caught and forced to pay back every penny he stole because he didn't donate hundreds of millions of dollars to elected officials. Charles Payne said They said the United States and the dollar remain preeminent partly to the rule of law, but without equal application. We're a Banana Republic sambachment Freed has already skated or escaped on campaign finance charges for the sake of the nation's position on the world stage. Let's hope everything else sticks.

We know somebody who does donate hundreds of millions to elected officials, and that's Ken Griffin And it's likely why the Dtcc, the Cftc, or the SEC have never gone after him and somebody else before Ken Griffin that loved donating money was obviously Bernie Madoff. It seems as soon as you start donating money to elected officials, you'll pretty much exempt from any kind of investigation. And if you are ever caught doing something illegal, well, it's just a few thousand dollars in fines. Dave Murphy Also tweeted a very interesting quote from a former SEC lawyer.

David Murphy are saying will the SEC ever go after Naked Shorts? How long does it take generally for the SEC to take action against these manipulative trading firms? But a former SEC lawyer said that nobody makes a name for themselves at the SEC by taking action against naked Shorts. likely because the SEC the Dtcc, the Cftc are paid off and funded exactly by those shorts shorting still front and center in the Reddit trade, many pointing to the recent swings in AMC being driven by so-called naked Shorts, the illegal practice of Short Selling a stock without actually locating that stock to borrow. So as naked shorting happening in this market, our next guest says, yes, it is. Let's bring in Jacob Frankel former SEC enforcement lawyer he is now a partner at.

Dickinson Wright Jacob Great to have you with us. Good to be back with you. Simple as that naked shorting exists in this market even though it's an illegal practice. Well, it's not entirely illegal.

But yes, in the large cap Market it absolutely would be, uh, illegal if if they, um, if a party's unable to locate the shares, borrow the shares deliver the shares. Yes, under those circumstances, um, it is illegal and it's something that's been going on in the market for a long time. What really has happened here is companies like GameStop AMC all these meme stocks have brought naked Short Selling Really to the Forefront of the Market's interest, This thing is going on for a very long time in a small cap market and is very much a problem. So if I were to try to think about how much of this naked shorting is actually going on in, let's say an AMC Is that a lot of intraday shorting like we were talking about during the commercial break? Is it up to an option expiration and then kind of gets, uh, flattened out? What? How big is it do you think around? Aside from those two things, well, that's really the challenge is we really don't.

We really don't know because a lot of it turns on. You know, on on a it's a very firm specific analysis. Is there coordination? Is there Manipulative activity? Is it intraday? As you point out, I Mean when I was at the commission and enforcement, you know I did a manipulation case that involved marking the flows of the porter end. Looking only at 30 minutes of trading, it does not have to be over an extended period of time.

The issue is identifying it and the people who see it or see it most closely are those who are in the market. And then the question then is are they willing to bring that information directly to the attention of the SEC Which often means also poking around in that company's books. So it and I'll should also add the short sellers for a long time and probably into this day are an important source of information for the Sec's enforcement division. By no means do I want to suggest the SEC you know has turned a blind eye.

On the other hand, we really have not seen that many cases over the years involving fraud. On the short side, I'll link the full video down in the description below because I don't want to include the entire video in my video, but it's really interesting to see this format. SEC Lawyer speaking on synthetic shorting, He said it absolutely exists. It happens all over the market, even in stocks like AMC, but it's difficult to pinpoint exactly who's doing it and when.

And it's just a massive mess for the SEC taking them years and years and years to ever bring synthetic short in cases. But one person that is getting his knickers in a Twist about Synthetic shorting is Ken Griffin who's currently having a secret war against their new film, Done Money. This article says the hedge fund billionaire is locked in a nasty behind-the-scenes legal fight over his depiction in the new GameStop movie, and it's hired at least two separate law firms to send Sony Pictures threatening letters. It says Griffin seems most upset at the supposed suggestion that Citadel Security is his E-trading firm that executed stock trades for the Robin Hood app colluded with Robin Hood's co-founder Vladenev to Halt trading on GameStop and other meme stocks during the height of the short squeeze chaos, the Griffinator states the film revives and amplifies the many times debunked collusion narrative and effectively accuses Griffin of committing perjury and saying that Griffin's letter admonishes Sony that if the studio doesn't correct the movie, viewers will wrongly believe that Ken and Citadel Securities conspired with Robin Hood to end the GameStop short squeeze and stick it to retail investors and that Ken Griffin would be within his right to sue for defamation.

but it seems Ken Griffin is unaware of the strides and effect. Cat Striker also explained their strides and effect, which refers to the unintended consequence of further publicizing information by trying to have it censored. and instead of successfully removing that information from the public, it becomes even more widely available than before as a backlash against the censorship attempt. Basically, by Ken Griffin just trying to have the movie altered.

It clearly shows he's guilty and has a guilty conscience and doesn't want anyone else finding out. That's likely because Ken Griffin are the market makers and hedge funds realize this squeeze is still on and they realize they're still in a terrible, terrible position and if more retail investors ended up rallying as a result of this movie, it would end up causing the short squeeze. Cat Strikers also tweeted about how she plans to see the film multiple times over helping AMC generate more revenue and helping the film do better at the box office. This will lead to even more people seeing the film and more and more everyday retail investors being aware of exactly what happened with GameStop and MC.

Finally, Dave Murphy pointed out that it's important to remember: Citadel Securities is still being sued by Northwest Biotherapeutics for manipulating their stock Northwest Biotherapeutics acute Citadel Securities and a number of other market makers of manipulating their stock between 2017 and 2022. it seems that our Securities other market makers Brokers and trading platforms are having more and more and more lawsuits brought against them for Market manipulation and I think it won't be long until people lose confidence in the entire Market as a whole or these market makers end up being sued. So guys, be sure to let me know what you think down in the comments below. And as always, guys, be sure to ding that notification Bell because that way you'll be alerted when I upload a new video.

Cheers.