SEC To Short Sellers: Open Your Books

Sep 18 2008 | 12:21pm ET

The Securities and Exchange Commission yesterday took new steps to restrict short-selling, and its chairman said that it is mulling new disclosure requirements for hedge funds.

The regulator adopted two new rules yesterday designed to push traders and brokers to deliver borrowed shares for shorting to buyers. It also promulgated a rule barring deception of brokers about the delivery of borrowed shares to buyers.

“In order to ensure that hidden manipulation, illegal naked short selling, or illegitimate trading tactics do not drive market behavior and undermine confidence, the SEC today took several actions to address short selling abuses,” Cox said. “In addition to these initiatives, which will take effect at 12:01 a.m. ET on Thursday, I am asking the Commission to consider on an emergency basis a new disclosure rule that will require hedge funds and other large investors to disclose their short positions.”

Under the proposed emergency, all investors managing more than $100 million, including hedge funds, will be “required to promptly begin public reporting of their daily short positions,” Cox said in a statement. The proposal must be approved by the commission before its adoption.

Cox also said that the SEC would issue a second round of subpoenas to “significant” hedge funds, seeking disclosure of “past trading positions in specific securities.” The agency this summer demanded information from hedge funds about market manipulation of financial shares.

View The New Rules HERE


In Depth

Fundraising for Mid-Sized PE Funds: Should You Use a Registered B/D?

Dec 6 2016 | 7:18pm ET

When does a fund sponsor need to use a registered broker/dealer when raising capital...

Lifestyle

Trump Attends 'Villains and Heroes' Costume Party Dressed As...Himself

Dec 5 2016 | 11:16pm ET

U.S. President-elect Donald Trump attended a "Villains and Heroes" costume party...

Guest Contributor

A Hard Look At Your ‘Soft’ Hedge Fund Marketing Information

Dec 8 2016 | 9:03pm ET

Conventional wisdom holds that due diligence examines quantitative as well as qualitative...

 

From the current issue of

Since the inception of Modern Trader, a core editorial theme has centered on the wisdom and power of crowds. Editorial emphasis has focused on companies and projects engaged in the collection and analysis of information. 

AVAILABLE NOW at BARNES & NOBLE

NEWSTAND LOCATOR