Subject: RE: File No. S7-06-22; Modernization of Beneficial Ownership Reporting
From: Matt McMahon
Affiliation:

Jun. 26, 2023

Dear Securities and Exchange Commission, 

I am writing to provide my comments for rule S7-06-22, which aims to modernize beneficial ownership reporting and enhance transparency and fairness in our financial markets. Comments and requests are below: 


Protecting Shareholder Rights: By giving beneficial ownership once the underlying security is delivered, the proposed rule can protect the interests of existing shareholders and maintain their voting power. This protection is essential to prevent dilution and ensure fair representation. 

Ensuring Fair and Equal Voting: Opposing the inclusion of derivative holders as beneficial owners ensures equal and fair voting rights for directly registered shareholders. It prevents undue influence and manipulation from derivative holders who may not have actual ownership of the underlying securities, ensuring that voting rights remain balanced and representative. 

Accurate Calculation of Ownership: The proposed examination of the delta concept for calculating ownership ensures accurate representation. Ownership should be based on the actual delivery of the underlying security, to prevent potential distortions arising from including derivative holders. This accuracy is vital for ensuring market fairness. 

Increased Transparency: The rule should enhance transparency by requiring hedge funds to disclose their short positions and activities. This transparency makes it more difficult for hedge funds to hide their positions and provides investors with a clear picture of the market. It ensures that key information is equally accessible to all participants in the market. 

Timely Reporting: The rule's requirement for prompt reporting of short position changes prevents the accumulation of hidden short positions. Reporting on time ensures that investors have access to up-to-date info about activities in the market and reduces the potential for market manipulation. 

Enhanced Oversight: The use of structured data, as required by the rule, helps enable improved monitoring of ownership data. Enhanced oversight empowers regulatory bodies to identify possible risks and take appropriate actions to protect market integrity. It improves the effectiveness of market surveillance. 

Deterrence against Market Manipulation: The increased transparency and reporting requirements help deter coordinated actions aimed at manipulating stock prices. By discouraging market manipulation tactics used by certain entities, the rule ensures a more level playing field for all market participants. 

Level Playing Field: This rule's transparency and accountability contribute to a more fair market environment. Ensuring that all investors have access to relevant info, promoting fair competition and preventing unfair advantages for specific market participants. It supports the key principles of equity and fairness. 

In conclusion, we should focus on the provisions for protecting shareholder rights, ensuring fair and equal voting, accurate calculation of ownership, increased transparency, timely reporting, enhanced oversight, deterrence against market manipulation, and establishment of a level playing field which are all vital for the integrity and fairness of our financial markets. I'd also like to note that this will be another example of how time and time again entities like Citadel continuously work against the interests of Household Investors and I can guarantee they will take an opposing view to what I have outlined here. When will the SEC begin to realize that entities like Citadel have only selfish intentions and do not seek to improve transparency or fairness in our markets? 

Thank you greatly for your time and your attention to this matter. I hope that you will carefully consider the importance of transparency, fairness, and the preservation of shareholder rights in our financial system and not let larger entities like Citadel have a louder voice simply because they have the financial pull to do so. Household Investors are the heart of the markets so I hope you hold mine and others concerns to a higher degree of concern than groups such as Citadel. 

Sincerely, 

Matt McMahon -- 




Matthew J. McMahon