Apr. 20, 2022
To whom it May Concern: In regards to the proposed SR-NSCC-2201-003, please reject this proposal. As a retail investor I am highly disturbed by the content of this new proposed rule that would effectively allow for FTDs (Failure To Deliver) to continue and worsen, which can be abused by market makers and used in conjunction with illegal naked shorting and abusive dark pool trade routing to control and suppress the price on security trading. This does not in any way benefit investors and in fact could be extremely harmful, which is anathema to the entire purpose of the SECs very existence. The SEC needs to look to why there is a need to push this rule in the first place, and why these organizations that directly benefit from these rules are proposing it. Is it because some market participants have engaged in risky behaviour and as a result, need a bailout through rule changes that directly benefit them? If so, if the SEC does consider pushing this proposal through, what does it tell the market about engaging in risky and illegal behaviours? that It's okay to do so because the SEC will always be there to bail them out because if thats the case, would this not just encourage market participants to create and take on riskier activities in the future? Think about the actions of these entities and what they do to the american people - this proposed rules encourages naked shorting (effectively counterfeiting shares) by enabling FTD's to continue/worsen which robs americans of their pensions. These entities are borrowing shares that don't exist and shorting them and this proposed rule will enable them to continue doing it in the future by kicking the can indefinitely - will the SEC be responsible for the continued counterfeiting of shares and robbing of pensions/401k's of the american people? Pushing this proposal through will indicate that the SEC is complacent in allowing this to continue, and will indicate to the market that the SEC is not on retail's side (which would go against what your SEC commissioner has said when he became commissioner that he is "here to protect retail investors") Please do not allow SFTs (Security Financial Transactions) proposed in this rule, to create new and potentially endless layers of can-kicking to be allowed, whereby the very real financial obligations of the FTDs get passed along instead of settled. I can see how it provides stability in the moment, but it also allows for abusive practices where market makers are never accountable for their failings. This is not acceptable and creates an opportunity to harm retail investors and it violates our rights for a free and fair market. The manipulation needs to come to an end. This rule only further encourages and rewards risky behaviour being taken by organizations that would continue with even more riskier behaviour if they continue to be bailed out by a regulating body that should really be neutral in promoting/regulating an equal, fair, and transparent market. Pushing this rule through would result in further loss in confidence in the SEC in their ability to keep an open, fair and transparent market for ALL participants. This proposal will encourage entities to further naked short/counterfeit shares, and will further worsen the situation. There are reasons why other countries have outright banned naked shorting - passing this through will indicate to other countries the corruption and loss of market confidence to the international and domestic investors because it would outline the SEC's compliance (through the passing of proposals that enable this risky behaviour) and participation to these activities that hurt retail investors. Please remove this proposed rule and furthermore please do not try to propose something similar again in the future, as iterations of this have been rejected in the past and continue to be rejected by educated investors every time they resurface. What a colossal waste of time, mine and yours, to continue to have to repeat this song and dance over and over again. The mission of the SEC is to look out for the well-being of investors such as myself, so I would propose that you direct your attention to doing so. This would best be accomplished by banning Payment For Order Flow which is inherently harmful to retail investors and which unfairly benefits Market Makers and brokers who do not have investors best interest in mind. Another worthy target for your attention would be to shut down the abusive use of dark pools by market makers such as Citadel which has been used to undermine the true value of securities traded by retail investors and to suppress price discovery. Thank you in advance for your timely attention to this matter, and please live up to your obligations and help the investors from predatory behavior by financial institutions. Sincerely, -Allen Hou