Approximately 513 million AMC shares, known as BDRs are being traded through Brazil’s stock exchange program.
BDRs are certificates issued by a depositary institution in Brazil that represent securities (stocks) issued by publicly-held corporations with headquarters overseas.
DISCLAIMER: “The depositary institutions must be authorized by the Central Bank of Brazil (Banco Central do Brasil – Bacen) and CVM to issue BDRs. The responsibility of disclosing the financial information of the issuing foreign company lies with the depositary institution.”
You’ll find that the depositary institution that disclosed this information was CitiBank.
Welcome to Franknez.com – a fellow ape by the name of Jimmy_AMC uncovered some rather disturbing news straight from CitiBank confirming the existence of millions of AMC shares overseas.
Here’s the case study that not only proves the existence of AMC synthetic shares, but also documents the loopholes in our financial system.
What is A2MC34 BDR?
A2MC34 is the ticker symbol for AMC stock in Brazil.
A2MC34 is a depositary receipt.
One of those receipts represents 1/6th of an actual share in the NYSE.
The depositary receipts are represented by a bank account or institution, in this case CitiBank, in which they have converted AMC shares into these so called BDRs (foreign stock).
It is up to the issuer (CitiBank’s client), whether they choose to convert the BDR into actual NYSE shares or not.
“There are plenty of issuers that operate with closed books”, according to Fidelity International Trading.
This particular BDR is not a sponsored ADR.
An ADR is an American Depositary Receipt that is negotiable, meaning AMC Entertainment has absolutely no legal say or obligations to these depositary receipts.
How Does A2MC34 BDRs Affect Share Price in The U.S?
According to the Fidelity International Team, these BDRs are a separate instrument and are not going to track the pricing of a share trading in the U.S market.
AMC’s shares outstanding in Brazil are approximately 3.08 billion, via Bloomberg.
Remember, this is a completely separate entity then the outstanding shares here in the U.S markets (500 million).
AMC’s market cap is 101 billion real (Brazil) which has nothing to do with the market cap in the NYSE according to the Fidelity International Trading Team.
You divide 3.08 billion shares by 6 to calculate the equivalence of 1 whole U.S market share and you get more than 513 million U.S shares that have been converted into BDRs.
You can listen to the entire conversation between Jimmy and Matthew Connor from Fidelity International Trading below.
So, what does this mean for AMC and retail investors?
It means that about twice the float in outstanding shares was converted into BDRs offshore.
This means these shares no longer have to be covered by any institution who created them in the first place.
We need answers from the SEC and its chairman, Gary Gensler effectively.
CitiBank Is One of The Largest Custodians in The World
With $23.7 trillion in assets under custody and administration and a global custody network spanning more than a hundred markets worldwide, Citi is one of the largest custodians in the world.
As you can tell, we’re going down the rabbit hole on this one.
Now, because CitiBank provides private banking services to institutions globally, they are not obligated to let Jimmy_AMC know who exactly processed these BDRs.
You can listen to the phone conversation between Jimmy and Michael Moore, a director at Citi on his YouTube channel here.
The DTCC Approved These BDRs
I did a little bit of research as to how this process even begins.
Well come to find out, the issuance needs to go through a private custodial bank, such as Citi, then processed through the DTCC, and finally going through the custodians program to convert the underlying asset.
The DTCC approved converting more than 513 million [NYSE] AMC shares into 3.08 billion BDRs (foreign stock), essentially brushing these synthetic/extra shares under the rug from the U.S markets.
I want you to take this in for just one second…
Ladies and gentlemen, this is financial treason.
This information must reach the masses.
I urge for community leaders and influencers to speak out on this incredible matter.
The community is the only solution.
Nobody in the government will stop this.
But there are more than 4 million retail investors in this community.
Make a RUCKUS.
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