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Fails to deliver in shares of AMC Entertainment Holdings, Inc. skyrocketed more than nine-fold, per data released today by the SEC.

Shares failing to clear numbered nearly 190,000 at the end of January, the most recent reporting period. Fails to deliver even neared 400,000 at one point in the data set, a staggering number.

This is a massive increase from 20,000 just two weeks prior.

Huge fails to deliver are nothing new for AMC. For some mysterious reason, this little stock has huge numbers of failed trades, month after month.

Here are the fails to deliver from the end of January for some of the largest stocks in the market. All are far below AMC’s, despite being much larger companies:

Alphabet Inc. Class A Shares: 27,991
Amazon.com Inc: 0
Apple Inc: 0
Microsoft Corp.: 0
Tesla Inc: 48,826

Sometimes, fails to deliver don’t point to anything nefarious. They can be the result of clerical errors and other honest mistakes.

But when a stock has a persistent pattern of huge fails to deliver, it can be a sign of naked short selling. This generally illegal practice involves selling short shares you don’t own.

Naked shorting is a powerful way to push down a stock’s price. If you don’t even need to own the stock, you can short an unlimited number of shares.

Indeed, the Department of Justice is currently investigating short sellers for illegal tactics. Federal agents have raided offices and seized hardware and trading records.

So we have a long term pattern of suspiciously high fails to deliver and a federal investigation. Is it really so hard to believe short sellers are breaking the law?

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What do you think is really going on in shares of AMC? Leave a comment at the bottom and let me know.

See you tomorrow, everyone! 🙂

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More on markets:

AMC Fails to Deliver Skyrocket 1940% to Start Year

Melvin Capital Under Federal Investigation

How Giant Hedge Fund Tiger Global Blows Up

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