Citadel Securities blasts Trump Media CEO over DJT brief sale letter

Citadel Securities ripped Trump Media CEO Devin Nunes on Friday for a letter he despatched the Nasdaq Inventory Market which talked about Citadel Securities and different main market firms after warning of attainable unlawful short sale buying and selling in DJT shares.

“Devin Nunes is the proverbial loser who tries to blame ‘naked short selling’ for his falling stock price,” a spokesperson for Citadel Securities mentioned.

“Nunes is strictly the kind of individual Donald Trump would have fired on The Apprentice,” mentioned the spokesperson referring to the previous Republican president’s enterprise competitors actuality TV present.

“If he [Nunes] worked for Citadel Securities, we would fire him, as ability and integrity are at the center of everything we do,” the spokesperson added.

A spokeswoman for Trump Media instructed CNBC in response: “Citadel Securities, a corporate behemoth that has been fined and censured for an incredibly wide range of offenses including issues related to naked short selling, and is world famous for screwing over everyday retail investors at the behest of other corporations, is the last company on earth that should lecture anyone on ‘integrity.’ “

Nunes’ letter to Nasdaq CEO Adena Friedman got here as Trump Media has given shareholders detailed directions on methods to keep away from their shares being utilized by brief sellers who’re betting that the value of DJT will fall.

Whereas Trump Media’s share worth has risen strongly up to now three days, it’s nonetheless buying and selling at about $26 per share decrease than its debut opening worth on March 26.

The corporate, which had simply $4.1 million in income final 12 months, has seen its market capitalization shed billions of {dollars} on account of the share worth drop.

Nunes instructed Friedman in his letter, “I write to bring your attention to potential market manipulation of the stock of Trump Media & Technology Group Corp.”

Nunes instructed that Trump Media’s worth had been used for so-called bare brief promoting, a follow during which merchants promote shares of an organization that the vendor had not really borrowed for that goal..

Nunes mentioned brokers had “significant financial incentive to lend non-existent shares” to brief sellers due to the unusually excessive premiums they’ve been capable of cost for such loans of DJT shares.

“Data made available to us indicate that just four market participants have been responsible for over 60% of the extraordinary volume of DJT shares traded: Citadel Securities, VIRTU Americas, G1 Execution Services, and Jane Street Capital,” Nunes wrote.

Citadel Securities has been the one a kind of 4 firms to touch upon Nunes’ letter, and the sturdy language in its response is placing, notably due to the political background of individuals concerned in Trump Media and Citadel Securities.

Nunes is a former Republican congressman from California. He resigned from the Home of Representatives in late 2021 to develop into the top of Trump Media when it was privately held. The corporate grew to become publicly traded final month on account of a merger with a shell firm.

Donald Trump, who’s the presumptive Republican presidential nominee, is almost all shareholder in Trump Media, holding a stake of almost 60%.

Citadel Securities’ founder and non-executive chairman is Ken Griffin, who has been a significant donor to Republican candidates.

Griffin contributed $5 million to a political motion committee backing former South Carolina Nikki Haley in her unsuccessful marketing campaign in opposition to Trump for the GOP nomination.

In September 2021, Griffin donated $5,800 to Nunes’ congressional marketing campaign, three months earlier than Nunes mentioned he was resigning his seat to develop into Trump Media’s CEO, based on a Federal Election Fee submitting.

– Further reporting by CNBC’s Brian Schwartz