[[the shorting of BB stocks by an individual U.S. citizen is illegal]]
I challenge you to prove that statement with a legal citation from either the United States Code or the Code of Federal Regulations. I did some legal research on this, figuring that you were just blowing smoke and trying to scare people from doing that.
There is nothing that prohibits the short selling of an OTC BB stock in 17 CFR 240.10a-1 or 17 CFR 240.10a-2, the main federal regulations on short selling, nor could I find anything in 15 USC 78i, 15 USC 78j, or 15 USC 78jjj, that cover prohibited actions under the Securities and Exchanges Act. I also scanned through other parts of Title 17, Code of Federal Regulations, and Title 15, United States Code, but those sections were the only ones I found immediately, that were appropriate.
Apparently, in the U.S., it is illegal to short a stock that your broker can not borrow. Most brokers will also not let you short any stock under $5 per share, which is my main regret in the DGIV saga, because when I found out about the stock, it had already sunk to $3 per share, and I could not short it.
Paul M. |
