Apr. 20, 2022
Dear SEC, You are constantly publically repeating your mission of maintaining fair, orderly, and efficient markets for all participants, especially retail investors. This rule cannot be passed as it has the opposite effect, again, especially on retail investors. What the proposed rule attempts to do is provide a mechanism for institutional firms to delay the delivery of securities which would otherwise result in Failure-To-Delivers (FTDs) FTDs have to be resolved and are costly and this is an attempt to circumvent that obligation by granting them overnight IOUs. It is further painfully obvious that institutional firms in particular intent to hide those FTDs accruing, which stem from selling short to retail investors. FTDs for shares that have been sold but never delivered, and in fact cannot be delivered because there was never a locate to begin with. Those that are "Naked" short sales. They can only be delivered if the short seller was to go in the open market and buy the shares, which is what obviously wants to be avoided with this rule. It is just another attempt to legally avoid RegSho, a rule which is so porous and ambiguous that it has done nothing to avoid FTDs and illegal naked short selling since inception. I would like to get specific here as I think it very beneficial to bring public attention to this topic: There is one idiosyncratic stock, which has been the victim of excessive naked short selling for years: GameStop ($GME). In coordination with other market participants, short sellers have found various creative ways to hide the true short interest and FTDs. However, the popularity of the stock continues to increase day by day, nationally and internationally, but the high retail demand is internalized and routed through dark pools to obfuscate it. By doing so, short sellers are racking up a humongous bill which will have to be settled at some point. Shorts must close and short sellers will have to pay the piper eventually. Retail investors will not idly stand by anymore while institutions try to avoid that obligation by any means necessary, which is exactly what this rule intends to do. Kick the can again. Not delivering a good which was already sold makes for unfair, inorderly, and inefficient markets which goes entirely against your mission. So please do your part and stop this rule. The whole world is watching. Best, Anthony Lathiago