Trump Media, the parent company of the former president’s Truth Social, has raised concerns about potential illegal activity impacting the price of its shares. The company alerted Nasdaq Inc. regarding suspected 'naked' short selling, a practice involving the selling of shares that are neither owned nor borrowed, which is generally considered illegal. In contrast, legitimate short sellers borrow shares before selling to benefit from declines in a company's share value.
In a letter to the exchange, the CEO of Trump Media outlined these concerns, indicating that the company's shares were on a list maintained by Nasdaq that suggests unlawful trading activity. The company's shares have experienced significant fluctuations, with a 50% decrease from its all-time high following its merger with a blank-check acquisition company to go public.
