I'm short 2000 barrels of crude oil (2 futures contracts). I guess I'm naked because I did not borrow the crude and I don't own the crude. I do put up a margin requirement.
I believe I can short the sp500 index too. I can go short 1 contract which is about 250,000 dollars worth of stock. Further, I would be naked in that I did not borrow 250,000 dollars worth of sp stocks.
but you're short the index so you'll either have to buy it back or deliver the shares by contractual obligation. the demand for the shares is built into the contract. it's not "naked shorting."
My comments were limited to STOCK shorting. As to the scenario you describe I would have to do further analysis as to whether things are borrowed with the knowledge of their owners or it they are the result of fraudulent brokerage activities.
But at first glance I don't see shorting futures contracts to necessarily to be an abrogation of fiduciary responsibility.
You're not naked, you're just short crude. Buy it back any day you like, and the transaction is settled, done, finis. Naked stock shorts never get settled...and that's the difference AND the problem.