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Trump Media warned the Nasdaq market of “potential market manipulation” of the company’s stock through “naked” short selling of shares.
The warning came as Trump Media offered shareholders detailed instructions on how to avoid someone lending their DJT stock to short sellers, who then execute trades betting that the price of the stock will fall.
Trump Media disclosed the warning to Nasdaq CEO Adrena Friedman in a filing Friday morning with the Securities and Exchange Commission, as DJT’s stock price has risen in recent days but remains significantly lower to the more than $70 per share with which it debuted on March 26. .
Trump Media CEO Devin Nunes, in his letter, did not directly accuse anyone in particular of naked short selling, that is, selling stocks without first borrowing from such sales for that purpose .
But Nunes noted that as of Wednesday, “DJT appears on Nasdaq’s ‘Reg SHO Threshold List,’ which indicates illegal trading activity.”
“This is particularly troubling given that ‘naked’ short selling often involves sophisticated market participants profiting at the expense of retail investors,” Nunes said.
Nunes, whose company owns the Truth Social app, pointed to circumstantial evidence that DJT was the most expensive stock to short in the United States in early April, which he said would give brokers “a significant financial incentive to lend non-existent shares.” “
Former President Donald Trump owns nearly 60% of Trump Media’s stock. The paper value of its stake has fallen by billions of dollars since DJT began trading last month.
Trump, the presumptive Republican presidential nominee, is currently on trial in New York state court on criminal charges related to the payment of hush money in 2016 by his then-lawyer to porn actor Stormy Daniels .
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