SEC seeks to curb naked ambition
The SEC has amended legislation in a belated effort to clamp down on naked short selling. But it remains under pressure from a lobby group that ranges from senators to lawyers, and management to shareholders, who believe the new rules are having little effect.
|Donaldson: the SEC chairman is under
mounting pressure to prove that new
rules on naked short selling are working
ON JANUARY 24 this year, Anthony Elgindy was convicted in Brooklyn Federal Court on charges relating to a naked shorting scam that affected more than 100 penny-stock companies. Between 1999 and 2002, Elgindy had been running a subscription website for hedge funds and brokers that invested in shares traded over the counter or on the pink sheets. On the website, Elgindy established a message board where he posted price-sensitive, non-public information provided by an FBI agent, Jeffrey Royer, on the penny-stock companies and their executives.