Creatd, Inc. ($VOCL) today disclosed it has collected significant findings from an internal investigation spearheaded by its subsidiary CEOBLOC's team. The company remains actively engaged with Christian, Smith & Jewell, LLP and its data partners, including Share Intel, to further this investigation. The investigation centered on potential issues related to naked short selling and the substantial volume of fails-to-deliver associated with its stock.
Since its public listing, Creatd, Inc.'s stock has seen over 30 million fails-to-deliver (FTD), with a remarkable 25 million since 2020. Based on the stock's closing prices during these FTDs, this equates to an approximate value of $69 million in failures for Creatd, Inc. alone. Importantly, these numbers are derived from the SEC website and other data sources, capturing only the reported fails-to-deliver.
The volume of unreported naked shorts is estimated to be substantially higher, potentially at a 5:1 ratio, due to regulatory loopholes and the involvement of Market Makers primarily trading $VOCL. This could equate to a synthetic reduction of over $200 million in shareholder value. Data patterns indicate that while most of the naked short selling originates from major institutional market makers. The timing and size of certain orders also suggest manipulative practices by individual hedge funds.
Jeremy Frommer, CEO and Chairman of Creatd, commented on the findings, stating, “The data we've uncovered shows strong indications of synthetic stock price deflation correlated with the fails-to-deliver data. We are committed to putting an end to naked short selling and other abusive trading practices that harm our shareholders and distort the true value of our stock. Over the upcoming weeks, I intend on reviewing the data with Wes and his team at Christian, Smith & Jewell, LLP and we intend to release more detailed findings to shed light on these malpractices and their impact. My goal is to move the issue to the congressional level in the first quarter of 2024. Our dedication to transparency and shareholder value remains unwavering.”
The Company remains steadfast in its commitment to ensuring transparency, integrity, and compliance in all its financial dealings. The ongoing investigation aims to identify any irregularities and take appropriate measures to address and rectify them.
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