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Failure to deliver

A failure to deliver occurs when a seller does not deliver securities by the settlement date. Most failures are operational rather than sinister, which is why raw failure data is a poor proxy for naked shorting.

instruments and markets · updated 2026-09-08

Where does failure to deliver come up?

This term is used in the following manipulation techniques, each explained in full on its own page.

The naked short selling debate — Naked short selling is selling short without having borrowed the security or arranged to borrow it, which is restricted by Regulation SHO and whose real-world scale and price impact remain genuinely contested.

Enforcement actions involving these techniques

Action	Agency	Filed	Technique	Penalty	Status
SEC v. Robinhood Financial LLC and Robinhood Securities, LLC (naked short selling debate, 2025)	SEC	2025-01-13	Naked Short Selling Debate , Spoofing	—	settled
SEC v. Maxim Group, LLC (naked short selling debate, 2023)	SEC	2023-09-29	Naked Short Selling Debate	—	settled
SEC v. Citadel Securities, LLC (naked short selling debate, 2023)	SEC	2023-09-22	Naked Short Selling Debate	—	settled
SEC v. Simplex Trading, LLC (naked short selling debate, 2023)	SEC	2023-09-11	Naked Short Selling Debate	—	settled
SEC v. Hal D. Mintz and Sabby Management LLC (naked short selling debate, 2023)	SEC	2023-06-14	Naked Short Selling Debate	—	filed

See also

Naked short selling — Naked short selling is selling short without having borrowed the security or arranged to borrow it. Regulation SHO restricts it an…
Regulation SHO — Regulation SHO governs short sales in US equities, imposing locate and close-out requirements and a price test triggered by sharp …

Terms that refer here

Naked short selling · Regulation SHO

Back to the full glossary — 261 defined terms.