The Trump Media & Technology Group is is doubling down on allegations that its shares are traded illegally – This time he brought his concerns to Congressional leaders.
Trump Media CEO Devin Nunes called on Congress to conduct a “thorough and expeditious investigation” into the company’s alleged “unlawful manipulation” of its shares. Nunes made the request in a letter on Tuesday to the chairmen of the House Judiciary, Financial Services, Ways and Means and Oversight and Reform committees.
Nunes said the company’s shares appeared to have been manipulated through a practice known as “naked” short selling, or illegally selling shares without first borrowing them. Trump Media’s CEO wrote that this was “particularly concerning because ‘naked’ short selling often results in sophisticated market participants profiting at the expense of retail investors.”
He noted that Trump Media has been on Nasdaq’s “Reg SHO Threshold List” – a list of securities whose transactions have failed to clear at a registered clearinghouse for five consecutive days – since April 2 “Indication of unlawful trading activities” with its shares was listed.
While “naked” short selling is one possible reason for a security not to clear, there are many Reasons why a stock might be on the Reg SHO list.
“We believe there are strong signs of unlawful manipulation of DJT shares,” Nunes wrote to members of Congress. “Therefore, I respectfully request that you initiate an investigation into DJT’s anomalous trading to determine its extent and purpose and whether any laws, including RICO laws and tax evasion laws, were violated so that the perpetrators of illegal activities can be held accountable .” Account.”
Trump Media, the company behind former President Donald Trump’s Truth Social, went public on the Nasdaq under the ticker symbol DJT on March 26 after completing its initial public offering Merger with Digital World Acquisition Corp.an acquisition company with a special purpose, or SPAC.
The company said the investigation should include requests for trading data from the Consolidated Audit Trail, data from the Financial Industry Regulatory Authority (FINRA), information from the Depository Trust and Clearing Corporation (DTCC), and reports from DTCC member firms indicating the total number of trades since then February 14 reflect shares sold short (inclusive). (Trading under the ticker symbol DWAC ahead of DJT’s March 26 debut).
After the revelations, Trump Media shares were in free fall for weeks Multimillion-dollar losses from operations in 2023the registered one Resale substantially all of its outstanding securitiesand the announcement of his own Live TV streaming platform.
Despite the collapse in Trump Media’s stock value, it is Daily short volume has remained stablesuggesting that sales are coming from long sellers rather than short sellers.
Shares of Trump Media rose nearly 8% on Wednesday afternoon, trading at $35.06 per share, increasing its market capitalization to $4.78 billion.
Based on data Nunes provided to the company, he said only four market participants accounted for more than 60% of trading volume in Trump Media shares: Citadel Securities, VIRTUAmericas, G1 Execution Services and Jane Street Capital.
Nunes I wrote a similar letter to Nasdaq CEO Adena Friedman last week. In response to the letter, a Citadel spokesman said Nunes was “the proverbial loser trying to blame ‘naked short selling’ for his falling stock price.”
This article originally appeared on quartz.