Let’s talk money…..short selling is a means of profiting from a fall in a share price.
Whether we agree with it or not people make their whole career around this. What is wrong is when someone issues a spurious report that deliberately drives down a share price especially where that report contains inaccuracies.
But, surely we are protected from this?
The answer is yes and no. If we are based in the UK and regulated then we can’t do this without strong foundations and even then it may be very difficult to defend. However, you can attack a UK company from abroad, profit and face no penalty for your actions.
If you want to dig around take a look at two companies Civitas (Social Housing) and Home REIT (providing long term accommodation for the homeless). Civitas is just coming through this, and Home REIT have had to suspend shares to protect investors as they fight the claims.
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