More than two months later and shareholders have not received the proposed preferred shares.
The company’s preferred shares that traded under MMTLP have been deleted as part of the highly anticipated Next Bridge Hydrocarbons spinoff.
Before that, on Dec. 9, the Financial Industry Regulatory Authority (FINRA) halted trading ahead of the final day on the market for MMTLP stock.
Next Bridge Hydrocarbons is not a publicly traded company, despite being spun off from one.
Investors who held MMTLP stock on Dec. 13 were expecting to receive shares of the private company.
Next Bridge Hydrocarbons on MMTLP Halt
Next Bridge Hydrocarbons released the following statement regarding the MMTLP halt.
“We recognize that some of our shareholders who owned Meta’s Series A Non-Voting Preferred Stock prior to the Spin-Off might have been affected by FINRA’s halting of the trading in that stock while the Company was still wholly owned and controlled by Meta.
The current board and officers of the Company have no information from FINRA regarding the Trading Halt other than the information in the public notice published by FINRA announcing the Trading Halt.
Further, FINRA did not provide any advance notice to the Company or Meta prior to its initiating the Trading Halt.
While we were not involved in the Trading Halt, we certainly empathize with anyone adversely affected by the Trading Halt and are assessing the matter.
The Company believes that our primary means of delivering shareholder value is to develop our interests in the Orogrande Basin, and we remain focused on this objective.”
In regard to what happened to shares of Next Bridge, the company said the following:
“AST has distributed all shares of our common stock related to the Spin-Off –either directly to any stockholders that held their shares directly registered with AST or to our shareholders’ bank, broker or nominee representatives.”
About Next Bridge Hydrocarbons
The Company is an independent public reporting energy company engaged in the acquisition, exploration, exploitation and/or development of oil and natural gas properties in the United States. Our primary focus has been the development of interests in an oil and gas project consisting of 134,000 contiguous gross acres we hold in the Orogrande Basin in West Texas in Hudspeth County, Texas. In addition, we have minor interests in the Eastern edge of the Midland Basin in Texas, and two minor well interests in Oklahoma. Please visit www.nextbridgehydrocarbons.comfor more information.
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Forbes published a piece surrounding Uber’s ‘troubled’ IPO stating that the SEC green-lighted naked shorting of IPOs in 2015.
“A curious thing happened during Uber’s troubled initial public offering last week: naked short selling of UBER shares by the banks involved in placing Uber’s IPO, according to several sources who confirmed this to CNBC.
But it was legal in this case, and it gave the banks a chance to profit–as investors lost money–when the IPO traded down 18% in its first two days.
Naked-shorting of IPOs by banks, which the SEC green-lighted as recently as 2015, has changed IPO market dynamics by altering the relative power between banks, issuers and investors.
To the detriment of investors, banks now have less fear of incurring major losses from pricing an IPO too high because banks now have a tool (naked shorting) to protect their downside risk.”
Forbes said that thanks to the SEC’s explicit statement allowing naked shorting during IPOs, banks have a chance to win regardless of what the IPO is priced at, a fear they had prior to getting the green light on naked shorting.
In a space call with Genius Group ($GNS) CEO Roger Hamilton, a user had stepped up to question the proof of naked shorting discussed about in sort of media or case.
As you can imagine, speakers on the panel were quick to give the user the information they lacked to research in the first place.
But it’s there, and this is just one case on the proof of naked shorting in the market.
GNS Shares Plummet After IPO
Genius Group CEO Roger Hamilton said he suspected naked shorting was happening in his company stock after shares had gradually plunged after their IPO date.
Roger Hamilton has been leading the fight against naked shorts by not only raising awareness on social media but also by taking legal action.
The company just launched phase 2 of their legal battle against naked short selling.
One of the topics discussed in the space call with Roger was of dual listing using the blockchain.
My thoughts on the blockchain are that it provided accountability and less stress on investors when dealing with manipulative shorting tactics.
It’s still a very new innovation, especially when discussing a tradable blockchain exchange.
A great effort to fight naked shorting nonetheless.
“Naked shorting is impossible to do when securities are issued natively on a blockchain. Had Uber’s shares been issued on a blockchain rather than through legacy systems, banks simply would not have been able to issue more UBER shares than the quantity of shares outstanding. The price-suppressive impact of the naked shorting–however large or small it was in the Uber case–simply could not have happened,” said Forbes.
Naked short selling, or naked shorting, is the practice of short-selling a tradable asset of any kind without first borrowing the asset from someone else or ensuring that it can be borrowed.
Naked shorting was enabled legally by UCC Article 8 in 1994, owing to a combination of two features: (1) indirect ownership of publicly-traded securities and (2) a special exemption that obviates the normal requirement that the seller prove in advance that it actually owns the property it is selling to a buyer.
“What we actually own is an IOU from our broker-dealer–a contractual right to the shares instead of the real thing. Your broker, in certain circumstances, has the right to conjure and sell you IOUs to more shares than actually exist,” says Forbes.
The US legal system made a policy decision to favor liquidity over solvency–to favor negotiability of securities over keeping accurate and timely records of who really owns what.
Patrick Byrne brought naked shorting to the attention of regulators but was ridiculed and eventually paid off with a winning settlement to lay low.
After the events of the ‘meme stock’ frenzy in 2021, retail investors came together and scrutinized the SEC, DTCC, and FINRA for allowing blatant market manipulation to occur.
Retail investors were momentarily prohibited from trading shares of AMC and GameStop due to liquidity concerns within several market makers and brokers including Citadel and Robinhood.
AMC and GameStop have had an incredible amount of FTDs, or failure-to-delivers.
These are orders that have not been executed in options, and are usually a result of a ‘short party’ not owning or not having all of the underlying asset.
This has led retail investors to the educated assessment that synthetic shares are floating in the market; shares known as naked shares used to short a stock.
According to Investopedia, “Despite being made illegal after the 2008–09 financial crisis, naked shorting continues to happen because of loopholes in rules and discrepancies between paper and electronic trading systems.”
(Reuters)FTX has objected to a U.S. Department of Justice request for an independent investigation into the once-prominent crypto exchange’s collapse, saying it is already conducting a wide-ranging probe that includes family members of FTX founder Sam Bankman-Fried.
FTX said in a court filing in Wilmington, Delaware, late on Wednesday that the DOJ’s proposed review would only add cost and delay to its bankruptcy case.
FTX acknowledged “fraud, dishonesty, incompetence, misconduct, mismanagement, and irregularity” in its past conduct, but said that its previous wrongdoing is already being probed by the company’s new management, its creditors and law enforcement agencies.
As part of its own investigation, FTX asked U.S. Bankruptcy Judge John Dorsey, who is overseeing its Chapter 11 proceedings, to help it secure documents from Bankman-Fried, members of his family and other insiders with information about FTX transactions that used “misappropriated and stolen” funds.
These transactions, it said, include a $16.7 million Bahamian real estate purchase under the name of Bankman-Fried’s parents, Joseph Bankman and Barbara Fried.
FTX is also seeking information about political donations connected to Bankman-Fried, asking wide-ranging questions about Mind the Gap, a political action committee founded by Barbara Fried, and Guarding Against Pandemics, an advocacy organization founded by Sam Bankman-Fried and his brother, Gabriel Bankman-Fried.
FTX said Guarding Against Pandemics’ multimillion-dollar Washington, D.C., headquarters was purchased with misappropriated funds.
A spokesperson for Mind the Gap said it did not receive direct contributions from Sam Bankman-Fried, although Bankman-Fried made donations to some political causes it recommended to its donor network.
FTX, once among the world’s top crypto exchanges, shook the sector in November by filing for bankruptcy, leaving an estimated 9 million customers and other investors facing total losses in the billions of dollars.
The U.S. Department of Justice’s bankruptcy watchdog has called for an independent investigation into its collapse, a request that received backing from a bipartisan group of U.S. senators.
FTX’s new CEO, John Ray, who worked with court-appointed examiners while leading Enron Corp and Residential Capital through bankruptcy, is prepared to testify that examiners in those two cases cost a combined $150 million and provided “minimal” benefits to creditors, FTX said.
FTX’s official committee of creditors joined the company in opposing the appointment of an examiner.
FTX also on Wednesday night filed a new list of creditors in bankruptcy court, which included financial watchdogs and government agencies from the United States, Japan and Switzerland, as well as companies including Airbnb Inc and crypto giant Binance.
Sam Bankman-Fried, who has been accused of stealing billions of dollars from FTX customers to pay debts incurred by his crypto-focused hedge fund, has pleaded not guilty to fraud charges. He is scheduled to face trial in October.