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Article
Publication date: 1 July 2004

Perrie M. Weiner, Edward Totino and Robert D. Weber

Over the past few years, regulators, issuers, investors, and other market participants have expressed increasing concerns regarding the real or perceived effects of short…

Abstract

Over the past few years, regulators, issuers, investors, and other market participants have expressed increasing concerns regarding the real or perceived effects of short selling. For example, thinly‐capitalized issuers whose shares trade on the over‐the‐counter market often blame short sellers for declines in the prices of their stocks. Recently, these issuers’ ire has focused on so‐called “naked short sellers,” i.e. short sellers who do not locate or borrow shares before selling. Likewise, other market participants have expressed apprehension about conduct involving short sales that may be viewed as disruptive or manipulative. The Securities and Exchange Commission (SEC) and the self‐regulatory organizations (SROs) have addressed these concerns both by promulgating new regulations governing short sales and by pursing enforcement actions. This article summarizes the new short sales rules contained in Regulation SHO and the amendments to Regulation M, and discusses recent enforcement actions pertaining to short sales.

Details

Journal of Investment Compliance, vol. 5 no. 3
Type: Research Article
ISSN: 1528-5812

Keywords

Article
Publication date: 24 April 2019

Perrie Michael Weiner, Edward D. Totino and Aaron Goodman

To analyze the evolution of market manipulation and fraud by short-sellers and online bloggers and mechanisms available for addressing and remediating the damage caused by…

Abstract

Purpose

To analyze the evolution of market manipulation and fraud by short-sellers and online bloggers and mechanisms available for addressing and remediating the damage caused by such fraud, including recent activity by the US Securities and Exchange Commission (the “SEC” or “Commission”).

Design/methodology/approach

This article discusses the development of a modern market manipulation and fraud scheme – the “short and distort” – including a review of potential claims by the targeted companies and anticipated impediments to asserting such claims.It further examines the need for regulation and the possibility that the SEC has opened the door for civil claims for this type of fraud.

Findings

Companies wrongfully targeted by illegitimate short-sellers may pursue claims for securities violations, defamation, business interference, securities fraud and extortion, among other claims.However, each of these claims has had, and still has, both business and legal challenges, as the short-seller’s initial defense tends to be to attempt to prove the truth of their statements to the market or establish those statements as legitimate opinion.The SEC has made the pursuit easier but there is still a long way to go.

Originality/value

This article contains valuable information about recent SEC enforcement activity and practical guidance from experienced securities lawyers.

Details

Journal of Investment Compliance, vol. 20 no. 2
Type: Research Article
ISSN: 1528-5812

Keywords

Article
Publication date: 6 July 2015

Perrie Michael Weiner, Patrick Hunnius and Sean R. Crain

To address “Conflicts, Conflicts Everywhere,” a speech at the recent IA Watch 17th Annual Compliance Conference by Julie M. Riewe, co-chief of the Securities and Exchange…

124

Abstract

Purpose

To address “Conflicts, Conflicts Everywhere,” a speech at the recent IA Watch 17th Annual Compliance Conference by Julie M. Riewe, co-chief of the Securities and Exchange Commission’s Enforcement Division’s Asset Management Unit (AMU).

Design/methodology/approach

Provide information on the AMU’s creation, the AMU’s 2015 priorities for each of the primary investment vehicles it polices –registered investment companies; private funds (both hedge funds and private equity funds); and other client accounts, such as separately managed accounts/retail accounts – and the AMU’s central concern across all of the investment vehicles it polices: conflicts of interest.

Findings

Conflicts of interest will be receiving much attention from the Commission in the coming months. In order to help avoid an SEC inquiry or, worse yet, an enforcement action, corporations and individuals should seek counsel.

Originality/value

Practical explanation and guidance from experienced securities and financial services lawyers.

Details

Journal of Investment Compliance, vol. 16 no. 2
Type: Research Article
ISSN: 1528-5812

Keywords

Content available
Article
Publication date: 6 July 2015

Henry A Davis

96

Abstract

Details

Journal of Investment Compliance, vol. 16 no. 2
Type: Research Article
ISSN: 1528-5812

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