Trump Media CEO says he’ll do ‘whatever it takes’ to defend DJT investors from short sellers

Trump Media CEO says he’ll do ‘whatever it takes’ to defend DJT investors from short sellers

Devin Nunes, executive director of Truth Social, speaks during the Conservative Political Action Conference (CPAC) in National Harbor, Maryland, USA, on Thursday, March 2, 2023.

Al Drago | Bloomberg | Getty Images

Trump Media CEO Devin Nunes said Friday he will “do whatever it takes” to protect the company’s retail investors from possible illegal short-selling of its shares.

“If we have to go to Congress or take legal action, we will do whatever it takes to defend our retail investors,” Nunes said in an interview with right-wing media outlet Newsmax.

Nunes also criticized President Joe Biden for mentioning Trump Media’s stock price in a speech earlier this week.

“Isn’t that strange?” Nunes said.

Speaking Tuesday in Scranton, Pennsylvania, Biden took a swipe at Donald Trump, his Republican election opponent in November, as shares of Trump Media plunged from their debut price of more than $70.

“If Trump’s stake in Truth Social — his — his company — falls even further, he may do better with my tax plan than with his,” Biden said.

Trump Media shares trade under the stock ticker DJT, rebounded towards the end of this week but has fallen sharply from its peak. This means that Trump, the company’s largest shareholder, has less value on paper for his 60% stake.

Nunes’ Newsmax comments confirmed his earlier theory that DJT’s stock decline was at least partially due to alleged illegal market manipulation.

Earlier Friday, Nunes warned the Nasdaq CEO that the drop in Trump Media’s stock price could be due to “naked” short selling, a trading practice in which the seller bets that the price of a stock will fall. This is a dealer who sells stocks that are neither borrowed nor intended for a loan agreement.

“DJT was reportedly ‘by far’ ‘the most expensive U.S. stock to sell short’ as of April 3, 2024, meaning brokers have a significant financial incentive to lend non-existent shares,” Nunes wrote in a filing Letter with the Securities and Exchange Commission citing CNBC.

Nunes said Trump Media appeared on Nasdaq’s Reg SHO Threshold List, which could indicate illegal trading behavior.

However, the SEC notes on its website that naked short selling does not “necessarily constitute a violation of the federal securities laws” unless it is intentionally used to manipulate the market. It also states that a stock appearing on the Reg SHO threshold list is not necessarily a sign of illegal trading activity.

Later that day, Citadel Securities, one of the trading firms named in the letter, mocked Nunes, calling him a “proverbial loser who is trying to blame ‘naked short selling’ for his falling stock price.”

In the Newsmax interview, Nunes appeared to hit back at this statement: “If you think nothing’s wrong, say nothing’s wrong.” You don’t go out and basically attack me personally.

Citadel Securities founder Ken Griffin is a major donor to Republican candidates, including Nunes, who served as the Republican House representative for California before taking the helm of Trump Media.

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2024-04-20 20:40:28