Devin Nunes, CEO of Truth Social, speaks during the Conservative Political Action Conference (CPAC) in National Harbor, Maryland, U.S., Thursday, March 2, 2023.
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Citadel titles have been torn Trump Media CEO Devin Nunes on Friday sent a letter to the Nasdaq Stock Exchange mentioning Citadel Securities and other major market firms after warning of possible illegal short-selling trades in DJT stock.
“Devin Nunes is the proverbial loser trying to blame ‘naked short selling’ for his stock price decline,” a spokesperson for Citadel Securities said.
“Nunes is exactly the kind of person Donald Trump would have fired against The Apprentice,” the spokesperson said, referring to the reality TV show about the former Republican president’s business competition.
“If he [Nunes] worked for Citadel Securities, we will fire him, as skill and integrity are at the heart of everything we do,” the spokesperson added.
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A spokesperson for Trump Media said in response to CNBC: “Citadel Securities, a corporate giant that has been fined and censured for an incredibly wide range of offenses, including matters related to short selling, and is world famous for ripping off investors everyday retail investors at the behest of other companies, is the last company on earth that should be lecturing anyone about “integrity.”
Nunes’ letter to Nasdaq CEO Adena Friedman came as Trump Media provided shareholders with detailed instructions on how to prevent their shares from being used by short sellers betting on DJT’s price to decline.
Although Trump Media’s stock price has risen sharply over the past three days, it is still trading about $26 per share lower than its debut opening price on March 26.
The company, which posted revenue of just $4.1 million last year, has seen its market capitalization lose billions of dollars as its share price falls.
Nunes told Friedman in his letter: “I am writing to bring your attention to the potential market manipulation of Trump Media & Technology Group Corp.’s stock.”
Nunes suggested that Trump Media’s price had been used for so-called naked short selling, a practice in which traders sell shares of a company that the seller had not actually borrowed for that purpose.
Nunes said brokers have “a significant financial incentive to lend non-existent shares” to short sellers because of the unusually high premiums they have been able to charge for such loans of DJT shares.
“The data available to us indicates that just four market participants were responsible for more than 60% of the extraordinary volume of DJT shares traded: Citadel Securities, VIRTU Americas, G1 Execution Services and Jane Street Capital,” Nunes wrote.
Citadel Securities was the only one of these four firms to comment on Nunes’ letter, and the strong language in his response is surprising, particularly given the political backgrounds of the people involved at Trump Media and Citadel Securities.
Nunes is a former Republican congressman from California. He resigned from the House of Representatives at the end of 2021 to become the head of Trump Media when it was private. The company went public last month following a merger with a shell company.
Donald Trump, the presumptive Republican presidential candidate, is the majority shareholder of Trump Media, with a stake of almost 60%.
The founder and non-executive chairman of Citadel Securities is Ken Griffin, who has been a major donor to Republican candidates.
Griffin contributed $5 million to a political action committee supporting former South Carolinian Nikki Haley in her unsuccessful campaign against Trump for the GOP nomination.
In September 2021, Griffin donated $5,800 to Nunes’ congressional campaign, three months before Nunes said she would resign to become CEO of Trump Media, according to a Federal Election Commission filing.
– Additional reporting from CNBC Brian Schwartz