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In July 2007, Piper Jaffray Cos. was fined $150,000 by the [[New York Stock Exchange]] (NYSE). Piper violated securities trading rules from January through May of 2005, selling shares without borrowing them, and also failing to "cover short sales in a timely manner", according to the NYSE. <ref>[http://www.nyse.com/DiscAxn/discAxn_07_2007.html "Member Firm Disciplined for Violations of SEC Rule on Short Sales and Operational and Supervisory Violations," NYSE Regulation, July 11, 2007]</ref> At the time of this fine, the NYSE had levied over $1.9 million in fines for naked short sales over seven regulatory actions.<ref> [http://www.bloomberg.com/apps/news?pid=newsarchive&sid=afpYSjiXF7iE "Piper Fined by the NYSE Over Short-Sale Violations", Edgar Ortega, Bloomberg News] </ref>
Also in July 2007, the [[American Stock Exchange]] announced two final disciplinary actions for violations of Regulation SHO short sale rules. SBA Trading was sanctioned for $5 million including a $1.4 million forfeiture of trading profits and ALA Trading was fined $1.2 million plus forfeiture of $1.8 million in profits. Both firms and their prinicpals were suspended from any activities involving Amex organizations for five years. Both firms used a market maker exemption to engage in naked short selling without acting as a bonafide market maker, and then engaged in close out transactions designed to circumvent Regulation SHO delivery rules. As a result of these violations, they were able to maintain naked short positions in a number of Regulation SHO threshold securities for an extended period of time. The violations were investigated by the Financial Industry Regulatory Authority (FINRA), formerly the NASD. <ref> [http://www.amex.com/atamex/regulation/discipline/2007/BArensteinALA_Decision_072007.pdf Amex Discplinary Decisions, ALA Trading]</ref> <ref>[http://www.amex.com/atamex/regulation/discipline/2007/SArensteinSBA_Decision_072007.pdf Amex Discplinary Decisions, SBA Trading]</ref> <ref>[http://www.exchange-handbook.co.uk/index.cfm?section=news&action=detail&id=68550 "American Stock Exchange Announces Two Disciplinary Actions For Violations Of Regulation SHO Short Sale Rules", Mondo Visione, July 31, 2007] </ref>
==Legislation==
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