I just recently started shorting and noticed I have to pay out a dividend.

I've read numerous websites documenting that this is how it works but frankly I'm at a loss of words (and some $$$).

I'm borrowing the stock from someone. So really, the person I borrow from should get paid the dividend from the company.

Instead, they get paid by the company.. and then I pay some fictional person???

Does anyone know why this is the way it is? It almost seems like the whole process got mucked up somewhere and everyone's been going with it over the years and (2) dividends are getting paid out when only (1) dividend should.