Trump Media Notifies SEC of Potential DJT Stock Manipulation

Trump Media Flags Suspicious Trading Activity to SEC, Alleges Potential Naked Short Selling

Trump Media and Technology Group Corp. (Nasdaq, NYSE Texas: DJT) has formally alerted federal regulators to what it describes as suspicious trading patterns involving its stock, according to a memo sent to the Securities and Exchange Commission on Wednesday.

The company, which operates the Truth Social platform, Truth+ streaming service, and Truth.Fi financial brand, has raised concerns about potentially illegal naked short selling and market manipulation of its shares following unusual disclosures by a UK-based hedge fund.

In its communication addressed to Acting SEC Chairman Mark Uyeda, TMTG highlighted a recent disclosure filed in Germany by London-based Qube Research & Technologies. According to the memo, Qube revealed a short position of nearly six million shares in DJT stock on April 10, raising questions about transparency and regulatory compliance.

“A U.K.-based entity, with a data center in Iceland, only disclosed these short sales in Germany,” TMTG noted in its memo, which was also sent to the Financial Industry Regulatory Authority (FINRA), Nasdaq, and the New York Stock Exchange.

The company pointed to discrepancies between Qube’s disclosure and official market data. According to Nasdaq figures cited by TMTG, total short interest in DJT as of March 31 was approximately 10.7 million shares, with third-party sources indicating the figure remained virtually unchanged at around 11 million shares as of April 16.

“Neither Nasdaq, NYSE Texas, nor any other source has been able to confirm when the trades disclosed by Qube were conducted or if they were conducted at all,” the memo states, suggesting potential irregularities in reporting or execution.

TMTG also referenced historical trading patterns that have raised red flags. The company noted that DJT stock appeared on Nasdaq’s Regulation SHO Threshold Security List continuously for more than two months in 2024. This list identifies securities with significant failures to deliver, often an indicator of potential naked short selling—a practice where traders sell shares they haven’t actually borrowed or located.

The company urged immediate regulatory action, requesting that the SEC “investigate this suspicious trading and report your findings back to TMTG and any relevant civil and criminal authorities.”

In a pointed criticism of market oversight, the company added that “American equities exchanges should be operated with full transparency and maximum efficiency, not as an opaque free-for-all reminiscent of a third-world casino.”

Short selling is a legitimate investment strategy where traders borrow shares to sell, hoping to buy them back later at lower prices. However, naked short selling—selling shares without first borrowing them—is generally prohibited under U.S. securities regulations implemented after the 2008 financial crisis.

The controversy comes at a time when TMTG is expanding its business portfolio beyond social media. The company describes its mission as “ending Big Tech’s assault on free speech by opening up the Internet and giving people their voices back.” In addition to Truth Social, which positions itself as “a safe harbor for free expression amid increasingly harsh censorship by Big Tech corporations,” TMTG has launched Truth+, described as a TV streaming platform focused on “family-friendly live TV channels and on-demand content.”

The company is also venturing into financial services with Truth.Fi, which it describes as incorporating “America First investment vehicles,” though specific details about this offering were not elaborated in the memo.

Market experts note that short selling controversies often emerge around volatile stocks with passionate investor bases. The SEC typically does not comment publicly on ongoing investigations, and it remains to be seen whether the agency will take action based on TMTG’s allegations.