[whimsicalism]

> They didn't tell you how much of the position they closed out on. They can say "they closed their position" even if they only closed out on 1% of it.

There is no ambiguity in what "closing the position" means. Stating on CNBC that you have closed the position when in fact you only bought shares to cover 1% of your short would put you in jail.

Your mental model for how the world works is wrong.

[stdgy]

Serious question: Has anyone ever been jailed for publicly saying they've closed a short position but not actually closing it all?

Is it equally illegal to say on CNBC that you closed it out, but to email your investors and tell them you didn't?

Is the legal issue that you're misleading your investors or that you're manipulating the market? Both?

[ziml77]

The thing the SEC is going to take issue with is lying to investors. Investors have a right to know what's going on with their money.

And despite how it seems from outside Wall Street, hedge funds are definitely scared of the SEC. Banks worry less because their money is sourced differently. Hedge funds have to worry about legal action not just for the fines but also for scaring their investors. When individual investors are so large it only takes a few redemptions to significantly impact AUM.

[Avalaxy]

The same way that tweeting "funding secured" puts you in jail?

[whimsicalism]

Musk didn't even make any profit from that (he didn't sell) and he still was fined $20 million and had to give up his Tesla board chair.

[TuringNYC]

Recall that when that was said, it was being said by an executive and director of a public company.