Apr. 20, 2022
Dear members of the SEC, As a very concerned investor, I want to make my statement known about this proposal. It is my understanding of this proposal, that with approval, the Securities Financing Transaction Clearing Service (SFT) would serve as a potential "loophole" for "failure-to-delivers." Failure-to-delivers/failure-to-receives (as you KNOW), popularly caused by ILLEGAL NAKED SHORT SELLING, have been a reoccurring problem within this market caused by criminal bad actors and unfair market mechanics, and in the future, WILL cause substantial outcomes. Approval of this proposal will allow abusive naked short sellers to continue shorting companies with no penalty, while causing FTD's, and postponing deliveries (criminal) near INFINITELY as a result of NSCC "novation." This proposal provides no solutions, but rather a temporary used band-aid. Within the SFT Clearing Frequently Asked Questions section, under "What are the benefits of the SFT Clearing service?: Bottom Answer: "Additionally, the need for Agency Lending Disclosure (ALD) reporting is no longer applicable for SFTs novated to NSCC." This is a problem for me. They have no disclosure of this "benefit" of SFT's in this proposal, which allows me to infer that the NSCC is fighting for lesser market transparency. Under the guidelines of ALD, agency lenders will be required to provide data to the borrowers' credit and regulatory capital groups so they can monitor credit exposure and calculate capital requirements for each principal lender. While they will not be required to book individual loans by principal lenders, borrowers will need to retain these records in accordance with existing regulations. This very exact implementation is what they want to strip away under the SFT with approval of this proposal. If you, members of the SEC are fighting FOR market transparency, please WITHDRAW this proposal. A. Moultrie