Kash Patel Takes on Wall Street Manipulation: Investigating Naked Short Selling and Insider Trading in Trump Media Stock Amid Broader Market Concerns

In a high-profile move that’s drawing attention from across the financial and political spheres, Donald Trump’s Media Company, Trump Media & Technology Group (TMTG), has launched an investigation into the practice of naked short selling of its stock. The probe, announced in June 2024, seeks to identify any potential market manipulation or illegal practices targeting TMTG’s stock. Leading the charge is Kash Patel, appointed to the TMTG board of directors in April 2022, who has long been a vocal critic of Wall Street abuses and has made it clear that he's committed to protecting the interests of retail investors.

Patel, a former top aide to President Donald Trump, has used his platform to advocate for government transparency and fair financial markets. He’s become increasingly outspoken about the market manipulation tactics that have affected both small investors and the broader economy. His involvement in the TMTG investigation isn’t coincidental. Patel’s efforts align with growing concerns over illegal short selling practices, including naked short selling, which has been a hot topic in recent years.

Naked short selling occurs when investors sell shares of a stock they don’t own or haven’t borrowed, with the intention of driving the stock price down. This practice can artificially deflate a company’s stock value, harming individual investors and skewing the true market value. The investigation into TMTG was prompted by unusual trading activity in early 2024, leading to questions about potential market manipulation and unfair practices targeting the company.

Rep. Devin Nunes, in a letter to Nasdaq CEO Adena Friedman, expressed alarm over the irregular trading patterns of TMTG stock. He emphasized the need for a thorough inquiry, noting that such an investigation would protect retail investors from manipulation and provide much-needed accountability in the face of potential illegal trading practices by Wall Street insiders. "A thorough inquiry into the anomalies of DJT stock trading would help protect these shareholders from any market manipulations and defend them against possible illegal practices," Nunes wrote.

The TMTG investigation takes place against the backdrop of a broader conversation about the state of U.S. financial markets. Under the Biden administration, there has been growing concern about the proliferation of illegal short selling, including naked shorting, which critics argue has been allowed to continue unchecked. Some point to the influence of powerful political figures, like former Speaker Nancy Pelosi, whose stock trades have raised questions about potential conflicts of interest and insider trading. While Pelosi has defended her actions, her trading activity, particularly around stocks tied to government policy decisions, has led to increased scrutiny from both the public and watchdog groups. Many believe this situation represents a disturbing pattern of privilege and market manipulation benefiting the political elite.

In addition to concerns about insider trading, retail investors have been raising alarms about the suppression of meme stocks—particularly GameStop (GME) and AMC Entertainment (AMC)—which became the focus of widespread trading activity in 2021. These stocks, which had been targeted by institutional short sellers, saw massive price increases fueled by retail investors banding together in online communities like Reddit’s WallStreetBets. In response, critics argue that Wall Street and financial institutions manipulated the markets to suppress the stock prices, using tactics like naked short selling to maintain control. This phenomenon of “meme stock suppression” prompted hearings in Congress and calls for tighter regulations on trading practices, especially concerning short selling and market manipulation.

Kash Patel’s leadership in addressing the potential manipulation of TMTG stock is part of a broader effort to challenge these systemic issues within the market. As a strong advocate for retail investors, Patel is positioning himself as a defender of small investors, working to level the playing field and ensure that powerful insiders can’t continue to exploit loopholes to manipulate stock prices.

In his fight against market manipulation, Patel is advocating for much-needed reforms to ensure that retail investors have equal footing with institutional players. The investigation into Trump Media’s stock trading is just one front in this ongoing battle, but it highlights a much larger issue: the need for greater transparency and accountability in the financial system. As Patel continues to push for action, it’s clear that the conversation around market manipulation, insider trading, and the regulation of short selling will remain front and center, especially as retail investors demand more protections and a fairer playing field.