New Enforcement Policies For Reg SHO And Fair Market Making Requirement
New enforcement policies are going into effect today with regard to short selling. The first is FINRA 4320, which mandates 13 day buy-ins for open delivery failures applying to shares of non-reporting corporations.
FINRA 2010-043, also starting on 2/28/11 reinstates the “short sale exempt” (SSE) marking requirements for trade reporting and the OATS system. Those MMs accessing the bona fide MM exemption from executing pre-borrows or “locates” before admittedly naked short sales must now formally acknowledge the accessing of that exemption.
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