April 20, 2022
This rule should be withdrawn. It allows bad actors who illegally naked short to infinitely extend the position without any risk. An infinite time loophole will be created where one could take profit now knowing they would be no risk of requiring to unwind their position. Risk is necessary and the penalty for taking undue risk needs to be enforced and paid. They could be caught with their hand in the cookie jar, stare you in the eye, and continue to take the cookie, eat it with a grin, and do it over and over. When the cookies run out, it isn't the bad actor that will pay -- they already have your cash -- it is everyone else and it will be a systemic problem as it has been shown the SEC is powerless to prevent this behavior in terms of cellar boxing, death spirals, illegal shorting, failures to deliver, and other illegal schemes involving nefarious short sales.