Wednesday, July 29, 2015

SEC News - Whistleblower Award, Insider Trading, Microcap Market Manipulation

Three Penny Stock Promoters Behind Pump-and-Dump Schemes

Three alleged microcap stock scammers have been charged with defrauding investors by disseminating promotional e-mails exhorting readers to immediately buy purportedly hot stocks so they could secretly sell their own holdings at a substantial profit.

The SEC announced a whistleblower award of more than $3 million to a company insider whose information helped the SEC crack a complex fraud.  The multi-million dollar payout is the third highest award to date under the SEC’s whistleblower program.

A Pennsylvania attorney has been charged with insider trading in the stock of Harleysville Group, Inc. in advance of the 2011 announcement of a $760 million merger of Harleysville and Nationwide Mutual Insurance Company.

A purported investment adviser in San Diego has been charged with stealing money from clients for personal use and conducting a Ponzi scheme to pay customers making redemption requests.

15 individuals and 19 entities are now facing charges for their roles in alleged schemes to manipulate the trading of microcap stocks.  The 34 defendants include six firms alleged to have acted as unregistered broker-dealers catering to customers who sought to conceal their stock ownership and manipulate the market for microcap securities. 

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