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by Mike Caswell

Options trading firm TradeZero Canada Securities ULC has filed lawsuits in the Supreme Court of British Columbia against three Vancouver-area clients over short sales that they entered and failed to cover. TradeZero says that the clients sold $383,313 worth of shares in a Nasdaq listing, but failed to deliver the stock by the settlement date. (All figures are in U.S. dollars.) As a result, the firm had to purchase shares, the suit states.

The allegations are contained in three notices of claim that TradeZero filed at the Vancouver courthouse on Dec. 10, 2024. The defendants are Harry Cheung, Austin Cheung and Wenying Xia. The three opened margin accounts at TradeZero in January and March, 2024. The accounts were self-directed and were for speculative trading of U.S. securities.

The problem, as described by TradeZero, stems from short sales that the three clients entered in October, 2024, in Chanson International Holding, a Nasdaq company that describes itself as a provider of bakery, seasonal and beverage products. The three accounts entered sales totalling $383,313 on or around the same date in early October, according to the lawsuits. As with all short sales, the sellers were required to deliver the shares by the settlement date to cover the sales.

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