SEC proposes new rule requiring short-sellers to disclose their positions monthly

Gary Gensler has been circling short-sellers for months, and now the Securities and Exchange Commission chief is looking to make a big move. Under a new rule proposed by the SEC Friday morning, some investors would be required to report their short sale-related activity to the SEC on a monthly basis, allowing the commission to make detailed short-selling data available to the public for the first time.

“Today, the Commission unanimously voted to propose rules and amendments to broaden the scope of short sale-related data available to the investing public and to regulators,” Gensler said in a statement. “If adopted, it would strengthen transparency of an important area of our markets that would benefit from greater visibility and oversight.”

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Since taking the reins at SEC, Gensler has made market transparency a key goal, and short-selling has been a major area of discussion, including after the wild short squeeze that took hold in January 2021 on meme stocks like GameStop GME, -5.80% and AMC Entertainment AMC, -3.90%. The fallout from the short squeeze resulted in a Congressional hearing and an SEC investigation. While the probe did not find any actual malfeasance, Gensler has been hinting that he still was monitoring short-sellers. In February, Bloomberg News reported on a sweeping Department of Justice probe of at least 30 short-selling firms and allies.


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