I dont ever post here but I have an issue concerning manipulation - and class actions etc; that's the bit that really caught my eye.
I am not a trader but I use live market screens so that I have at least some insights into the companies I want to invest in. IMO manipulation is rife in many ASX listed companies and the things I have a real hostility to is where short selling is used in conjunction with HFT - and that of course includes fraudulent buy and sell orders which you allude to. But I have a question which you maybe have more knowledge.
Naked short selling is illegal. When I place a sell order on CommSec a warning springs up that I must have the stock.
Now as I understand, during the course of a trading day a market manipulator may be prepared to short sell a stock depending how his/her strategy is looking compared to the live market. If he does not own any stock to support his planned short - he needs to borrow some. I have no idea how that works but no doubt it can be processed in some slick fashion that the racket of stock lending allows. Now the next part of my query is this: shorts have to be reported daily to ASIC - but what does that mean exactly? Does it mean willy nilly trading can occur during the day until a nett short position is reached at 4.10pm after all the buying and selling has finished? Could it mean that the manipulator does not really need to prove he has cover for his new short position until the clock ticks around to 4.10pm? And finally, could it be that naked short selling is taking place across the ASX all day until the books need to be closed at 4.10pm. If that were the case it would mean wholesale criminal practice enough to keep an army of prosecutors busy were any class actions to occur as you allude to? After all, one naked short sale made by anyone in the space of a few seconds is a crime. If it's a hundred times a day, it is a hundred crimes.
