Benzinga - by Nabaparna Bhattacharya, Benzinga Editor.
Trump Media & Technology Group Corp. (NASDAQ:DJT) shares are trading higher on Wednesday, although in a volatile trading session.
The company sent the U.S. House of Representatives a letter regarding potential stock manipulation and anomalous trading.
DJT’s CEO, Devin Nunes, wrote the letter addressing each of the Chairmen of the U.S. House of Representatives Committee on the Judiciary, Committee on Financial Services, Committee on Ways and Means and Committee on Oversight and Reform.
The letter has been published in an exchange filing.
“Since April 2, 2024, DJT has appeared every day on Nasdaq’s “Reg SHO threshold list,” which is indicative of unlawful trading activity. This is particularly troubling given that “naked” short selling often entails sophisticated market participants profiting at the expense of retail investors,” Nunes said in the letter.
“Reports indicate that, as of April 3, 2024, DJT was the single most expensive stock to short in U.S. markets by a significant margin, meaning that brokers have a significant financial incentive to lend non-existent shares,” the company said in the exchange filing.
Nunes, himself a former House GOP chair, wanted to understand whether any laws, including RICO statutes and tax evasion laws, were violated so that the perpetrators of any illegal activity could be held to account.
On Tuesday, the company clarified to its shareholders that brokerage firms may facilitate short selling in DJT shares by lending shareholders’ shares held in margin accounts.
Former President Donald Trump’s Trump Media & Technology Group, behind the Truth Social platform, specifically asked shareholders to hold their DJT shares in a cash account at their brokerage firm instead of a margin account.
The company has also asked shareholders to opt out of any securities lending programs, which should stop their broker from lending their shares.
In addition, Trump Media & Technology said it prefers its shareholders to move their shares to a Direct Registration account at the company’s transfer agent, Odyssey Transfer & Trust Company.
Price Action: DJT shares are trading higher by 1.54% to $33.07 at the last check Wednesday.
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