Investors want more held accountable following Bill Hwang’s sentencing of 18 years. There seems to be a rule that culprits only go to jail if high net worth individuals get screwed.
But what about retail investors?
Retail investors have taken note that prison only becomes a viable option when the pockets of ultra high net worth individuals has suffered.
Madoff, who also defrauded billions from banks and high net worth clients, created such a massive problem that his punishment was a 150 year sentence.
The Ponzi-schemer is said to have lost over $65 billion from the highest net worth individuals, royal families, and institutional parties during his time.
It is estimated that nine financial institutions lost over $9 billion in Hwang’s fraud, per Fortune, not nearly as much as Madoff’s clients.
Looking at the disgraced scandal involving Epstein, JPMorgan, and alleged high-net worth public figures, lies another case of injustices.
When high-net worth individuals are exposed to significant losses, prison becomes a viable consequence.
This is never the case when it comes to the defrauding of Main Street, your day-to-day retail investors.
Who are these figures cheating day-to-day investors?
You have the ‘liquidity’ fairies such as Citadel and Virtu who have taken advantage of retail investors time and time again with no serious repercussions.
Citadel was recently named in a RICO lawsuit in Georgia along with others for defamation and intellectual property theft, “rendering the company ‘uninvestable’ for anyone but themselves.”
In September, the SEC reported that for five years Citadel incorrectly marked short sales as long sales and vice versa.
“Compliance with the order marking requirements of Reg SHO is a key component of regulatory efforts to curtail abusive market practices, including ‘naked’ short selling,” said Mark Cave, Associate Director of the SEC’s Division of Enforcement.
“This action against Citadel Securities demonstrates that a broker-dealer’s failure to comply with the requirements of Reg SHO can have negative downstream consequences on the accuracy of the firm’s electronic records, including its electronic blue sheet reporting, depriving the Commission of important information about the markets it regulates.”
David Inggs who is Global Head of Operations at Citadel and is responsible for all products across asset servicing, billing, cash management, and clearing, also has a board seat at the regulatory agency DTCC.
This conflict of interest has raised big concerns amongst the retail investor community who argue it’s no surprise Citadel has not faced any major consequences for violations.
The Securities and Exchange Commission said in September that the market maker violated a provision of Regulation SHO, the regulatory framework designed to address abusive short selling practices, which requires broker-dealers to mark sale orders as long, short, or short exempt.
For years now, Main Street has argued that illegal short selling practices have suppressed the price of stocks and pinned down the performance of stocks in companies they support.
Investors want more individuals held accountable following Archegos’ Bill Hwang’s sentencing.
The question now is, will Trump’s administration be the force to rule out corruption in the financial and capital markets?
After all, Trump’s social media site publicly scrutinized Ken Griffin’s Citadel Securities for naked short selling the market earlier this year stating:
“Rather than support our common sense efforts to promote transparency and compliance, Citadel Securities bizarrely targeted our CEO with an unhinged attack. Here’s our response:
“Citadel Securities, a corporate behemoth that has been fined and censured for an incredibly wide range of offenses including issues related to naked short selling, and is world famous for screwing over everyday retail investors at the behest of other corporations, is the last company on earth that should lecture anyone on ‘integrity.’”
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Also Read: JPMorgan CEO Has Now Become The Target of Over 200 Investigations
About The Author
Naked short selling has destroyed the integrity of the small and micro caps. All the data is bad with regard to share counts and trading volume. These pigs have ruined a great area of investing. There can be no settlements or frankly any mercy shown for these scumbags once the truth is evident.
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