FINRA plans to protect the bad actors behind the MMTLP scandal in the latest MMTLP court update.
The self-regulatory body is claiming immunity and is refusing to provide retail investors with the blue sheets that shed light on the trading activity and fraud that occurred in ticker symbol MMTLP prior to the U3 halt and delisting.
FINRA states that the petitioner’s request is ‘overbroad and unduly burdensome’, being one of the few claims to deny MMTLP investors the blue sheets.
They also state that blue sheet data may reveal the confidential trading approach of firms and their customers, and includes personal, financial, and identifying information for individual and other investors.
“Because Blue Sheet Data contains highly confidential information, FINRA does not make Blue Sheet data publicly available.
FINRA also restricts access to Blue Sheet Data collected by examination and investigations team.”
This is a massive red flag that leads the average investor to believe the self-regulatory agency must be overseen and be limited some power.
Essentially what this means is the market can have a collusion of bad actors with a common goal and never have to take accountability should a party or investigations team request to view their trading activity via Blue Sheet Data.
SEC Chairman Gary Gensler often speaks about the remarkable importance of blowing the whistle in cases like this.
FINRA is Granted Immunity in MMTLP Blue Sheet Data Request
According to the latest MMTLP court case documents, FINRA is granted absolute immunity from suit and all burdens of litigation, including discovery, “for claims arising out of its regulatory activities.”
“Because immunity precludes lawsuits against FINRA for conduct that arises from its regulatory activity, if the Petition is granted, this Court would establish precedent that would also expose FINRA — as well as other New York-based SROs like the NYSE and NASDAQ stock exchanges — to a potential deluge of pre-action disclosure requests made by disgruntled investors “fishing” for information to support potential securities lawsuits.
FINRA is making no effort to protect retail investors but rather to keep their client’s information and trading activity private.
FINRA is a legal black market where powerful institutions are able to cheat the average investor without taking accountability due to the agencies unlimited power and lack of oversight.
Transcripts surfaced in April revealing conversations between FINRA and the SEC relating to the MMTLP case last year.
“Looks like this MMAT/MMTLP matter has now hit my Fraud team’s radar screen (and seemingly a lot of other radar screens as well). I know you have spoken to Patti Casimates and our General Council’s office — but was wondering if it made sense for my Fraud team to have a conversation directly with you and your folks working on the matter so we are not duplicating efforts.
We are looking at the two issuers from a fraud/manipulation angle and, in fact, bluesheeting both MMAT and MMTLP as we speak,” said Sam Draddy to the SEC on December 5th, 2022 — just days prior the U3 halt and delisting of MMTLP.
Petition to Strip FINRA’s Absolute Immunity Status
Since the latest MMTLP court update, a petition to strip FINRA’s absolute immunity status has surfaced on social media.
“In light of FINRA’s inability to protect retail investors, as stated in their mission statement, and amidst of the concerns of illegal naked shorting, spoofing and market manipulation present in the stock market, I propose the SEC and Congress strip FINRA’s SRO status and its Absolute Immunity protection.
A regulatory body such as FINRA (or any public, private or self-regulated body for that matter) should not be able to shield itself from any form of litigation on the basis of absolute immunity.
The judicial system works only if everybody and every body has equal participation,” says the petitioner.
Nearly 1,000 people have signed the petition.
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