What I don’t get is how you can short 140% of a stock to begin with. That means there has to be dark pools of ghost stock out there that is ‘off books’.
How can you have MULTIPLE due dates for a short share of stock? Shorting is supposed to be borrowing a share with an option to buy it within a future date. The only way your scenario works is if you borrow the stock to short, then offer to short to someone else during the same time frame. That would give you multiple dates, and this creates the >100% short versus float position even though it is still only one share of stock, but you have leveraged the transaction to make you money. That should be totally illegal because you never own the stock. It is borrowed, so how can you offer something borrowed you don’t own to someone else to borrow? This effect is no different then naked shorting which IS illegal because you don’t actually borrow the stock.
The other way they can do this is to offer ‘fractional’ shares. That way you can get your multiple dates, but that does not account for the >100% short position versus %float. No, the only way you can get >100% is through fraud and off-book accounting. This is leveraged shorting.