Citadel Securities slams Trump Media CEO over DJT’s brief sale letter

Norman Ray
Norman Ray

World Courant

Devin Nunes, CEO of Fact Social, speaks on the Conservative Political Motion Convention (CPAC) in Nationwide Harbor, Maryland, USA, on Thursday, March 2, 2023.

Al Drago | Bloomberg | Getty Pictures

Citadel Results cracked Trumpmedia CEO Devin Nunes Friday for a letter he despatched to the Nasdaq naming Citadel Securities and different main market companies after warning of potential unlawful brief promoting of Trump Media inventory.

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“Devin Nunes is the proverbial loser attempting accountable bare brief promoting for his declining inventory worth,” a Citadel Securities spokesperson mentioned.

Citadel Securities founder and non-executive chairman Ken Griffin is a significant donor to Republican candidates, together with Nunes, a former Republican congressman.

“Nunes is strictly the kind of individual Donald Trump would have shot on (The) Apprentice,” the spokesperson mentioned, referring to the previous Republican president’s actuality TV present.

“If he (Nunes) labored for Citadel Securities, we might fireplace him as a result of competence and integrity are on the coronary heart of every thing we do,” the spokesperson added.

A Trump Media spokeswoman mentioned in response: “Citadel Securities, a company large that has been fined and convicted for an extremely big selection of violations, together with points associated to bare brief promoting, and is world-renowned for pushing bizarre deceive non-public traders. of different corporations, is the final firm on the earth that anybody must be lectured about ‘integrity’.”

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Later Friday, Trump Media famous in a brand new submitting with the Securities and Trade Fee the assertion it issued in response to Citadel Securities’ remark about Nunes, each on the Fact Social app and within the media.

The submitting states: “Relatively than supporting our frequent sense efforts to advertise transparency and compliance, Citadel Securities bizarrely focused our CEO with an unhinged assault.”

Pavlo Gonchar | Mild rocket | Getty Pictures

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Nunes’ letter to Nasdaq CEO Adena Friedman, disclosed in a submitting with the SEC, got here two days after Trump Media gave shareholders detailed directions on the best way to stop their shares from being utilized by brief sellers who’re betting that the inventory’s worth will valleys.

Though Trump Media’s inventory worth has risen sharply over the previous three days, it’s nonetheless buying and selling sharply decrease than its opening worth on March 26.

The corporate, which owns Fact Social and had simply $4.1 million in income final yr, has seen its market capitalization lose billions of {dollars} because of the decline in its inventory worth.

Nunes instructed Friedman in his letter: “I’m writing to attract your consideration to potential market manipulation of the inventory of Trump Media & Expertise Group Corp.”

Nunes urged that Trump Media’s worth had been used for so-called bare brief promoting, a apply during which merchants promote shares of an organization that the vendor had not truly borrowed for that objective.

Nunes mentioned brokers had “a big monetary incentive to lend nonexistent shares” to brief sellers due to the unusually excessive premiums they might cost for such loans of Trump Media inventory, ticker image DJT.

“Information made out there to us exhibits that simply 4 market members are chargeable for greater than 60% of the extraordinary quantity of DJT inventory traded: Citadel Securities, VIRTU Americas, G1 Execution Providers and Jane Road Capital,” Nunes wrote.

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Citadel Securities was the one one in every of these 4 corporations to touch upon Nunes’ letter.

The sturdy language in her response is placing, particularly given the political background of individuals concerned with Trump Media and Citadel Securities.

Nunes resigned as consultant of a California district within the Home of Representatives on the finish of 2021 to change into the top of Trump Media when it was privately held. The corporate went public final month on account of a merger with a shell firm.

Donald Trump, the presumptive Republican presidential candidate, is almost all shareholder of Trump Media and has an almost 60% stake.

Citadel Securities founder Griffin contributed $5 million to a political motion committee that supported former South Carolina Governor Nikki Haley in her failed marketing campaign in opposition to Trump for the Republican nomination.

In September 2021, Griffin donated $5,800 to Nunes’ congressional marketing campaign, three months earlier than Nunes mentioned he would resign his seat to change into Trump Media’s CEO, in line with a Federal Election Fee submitting.

Citadel Advisors, an funding administration agency additionally based by Griffin, in December owned practically 160,000 shares value $2.8 million in Digital World Acquisition Corp., the shell firm whose merger with Trump Media final month took Trump Media public might be traded.

A Citadel spokesperson instructed CNBC, when requested about that stake in DWAC: “Per our function as a market maker, we regularly keep a sure stage of stock for closely traded shares.”

“The goal is to facilitate buying and selling for purchasers, and to not make a focused wager a method or one other,” the spokesperson mentioned.

– Further reporting by CNBC’s Brian Schwartz.

Citadel Securities slams Trump Media CEO over DJT’s brief sale letter

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