Tuesday, January 26, 2010

SEC Charges Two California Firms For Unlawful Short Selling Practices

Enforcement Actions Are SEC's First Under Revised Rule to Curtail Abusive Short Selling

Washington, D.C., Jan. 26, 2010 — The Securities and Exchange Commission today separately charged two California investment advisory firms for engaging in improper short selling of securities in advance of their participation in a company's secondary offering. These mark the first cases filed under the SEC's amended Rule 105 of Regulation M, which is designed to prohibit manipulative short selling ahead of follow-on securities offerings.

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