Naked shorting is something officialdom don't want to talk about...

Naked shorting is something officialdom don't want to talk about - EVER. It's supposed to be illegal.

Even down on the street nobody wants to talk about it; you'll never see anyone promoting it as a service, it's not in any investing books, never ever mentioned in the finance media. Basically the difference between regular shorting and naked shorting is STOCK LENDING: Now there's something people do want to talk about - because it infuriates them that a company they hold as an investment is lending out it's own common stock for a few shekels, while the borrower is madly shorting the same company to create or play on negative sentiment for his own narrow advantage. If ever the human race could come up with a classic example of Dog eat Dog.....this is a great example.

So here, what the authorities do is bury their heads in the sand and keep quiet....because they are timid..
But not so in the USA as @ddwn exposed here on HC as I remember, they tossed the whole sticky problem onto the people who wanted it: the Broker - and it works like this: if the naked trades are settled and nobody is complaining - all good. But if any trades go bad and parties cannot pay - it's your problem Mr Broker, do your best and get it fixed! Unless you can find eventual remedy in the courts, your license will be ripped up and you can vacate the building. But I guess that could never happen because of the enormous heft big bank backed brokerages can bring to bear to get stuff "fixed"quietly.

So then naked shorting here in Australia is like a taboo subject at dinner parties, for example like incest.
There are rules about who can do it - with whom, and when (it's starting to sound like illicit sex already .
But thats only due to the fawning nature of our spineless authorities who will do anything - from boot-licking upwards - to capitulate to the influence of big sponsors of global share trading - or else they might "pack up our bats and balls and take our business somewhere more friendly like Singapore" !!!!