Trump Media Wants an Investigation into Market Manupulation, Blames 'Naked' Short Sellers for Losses

Trump Media & Technology Group has unleashed another volley in its attack on short sellers who bet on Donald Trump's social media firm. Devin Nunes, CEO of Trump Media, has asked the Nasdaq to assist in examining the alleged market manipulation of the company's stock.

He is looking for trade information from 13 financial institutions and requests that the Nasdaq "fully cooperate with any and all congressional or other investigations into these firms."

"DJT stock is owned by over 620,000 stockholders, the great majority of whom are regular retail investors. A thorough investigation into the peculiarities of DJT stock trading will assist safeguard these shareholders from any market manipulations and defend them against suspected criminal acts by Wall Street insiders," Nunes stated in a letter to Nasdaq CEO.

Nunes initially contacted Friedman in April to alert the exchange about "potential market manipulation." The Nasdaq was not immediately available for comment.

Citadel Securities, founded by Republican megadonor Ken Griffin, labeled Nunes a "loser" for blaming Trump Media's losses on short-selling.

Short sellers do not own the shares; instead, they borrow them and then sell them, wagering that the stock will fall, allowing them to buy back the shares at a cheaper price and retain the difference.

Trump Media has accused financial corporations of participating in naked short sells, which are bets that a company will fall without borrowing or holding any shares. Such a technique may be prohibited.

Historically, short selling has served as a scapegoat for corporations facing market pressure.

"Nunes may be attempting to divert attention away from the fact that Trump Media management is struggling to increase revenue and become profitable," said Jay Ritter, a finance researcher at the University of Florida. "Whether there is naked short selling going on or not, it is hard to justify a $8 billion market cap for a struggling firm with $4 million in annual revenue."

Trump controls 65% of the stock in the parent business of the Truth Social app. The stock is traded under the vanity symbol DJT.

Since the stock began trading in March following the merger with shell firm Digital World Acquisition Corp., volatility has been the overriding principle. It has fluctuated drastically, from a high of $79.38 per share on March 26 to a low of $22.84 on April 16. It rose 3% to $46.75 on Wednesday.

Trump Media's $8 billion market capitalization is virtually completely based on the Trump brand and his dedicated fanbase, which includes small-time investors who have supported him by propping up the stock.

Trump Media posted a first-quarter net loss of $327.6 million on revenue of less than $1 million.