• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar

Republica Press

Your Business & Political News Source

REPUBLICA PRESS
Your Business & Political News Source

  • Home
  • BUSINESS
  • MONEY
  • POLITICS
  • REAL ESTATE
  • SCIENCE/TECH
  • US
  • WORLD

Penny Stocks Are Booming, Which Is Good News for Swindlers

by

“It’s all just a pool filled with sharks,” said Urska Velikonja, a law professor who studies securities regulation at Georgetown University Law Center. “It’s where the unwary go to get eaten.”

Penny stock booms tend to occur during raging bull markets, when greed abounds. They were hot in the 1980s, when the arrival of cheap, long-distance telephone service gave rise to brokerage firms that specialized in high-pressure, cold-call pitches of worthless stocks.

That was the specialty of Blinder, Robinson & Company, which was led by Meyer Blinder, a New York broker with a flamboyant reputation. In the mid-80s, it became the largest penny stock brokerage in the country. But by 1990 it had been liquidated, and by 1992 Mr. Blinder had been convicted of racketeering and securities fraud. After his conviction was announced, he lunged at a prosecutor, threatening to kill him.

But stock-touting technology changes with the times. Cold-calling went out, followed by faxes and email spam. Today, social media sites like Twitter and Reddit, which powered the rise of GameStop and other meme stocks, are the preferred method for building unwarranted hype.

According to a civil complaint filed this month by the S.E.C., Andrew Fassari of Irvine, Calif., used his Twitter account — OCMillionaire — to pump up the price of Arcis Resources, a company that has not conducted business since at least 2016, but whose stock still trades. Mr. Fassari, regulators said, bought 41 million shares of the company and then posted misleading information, including fictitious emails from the company’s purported chief executive about expansion plans. Over nine days in December, the share price skyrocketed more than 4,000 percent — to a little over a nickel. Mr. Fassari’s gains were $929,000, according to the agency.

Mr. Fassari’s lawyer, Jessica C. Munk, said he denied wrongdoing. “It appears Mr. Fassari has been hit with fallout from the GameStop, Robinhood, Reddit controversy,” Ms. Munk said in a statement, including a reference to the Robinhood trading app. She also noted the S.E.C. action’s “lightning pace.”

View Source

Filed Under: BUSINESS Tagged With: Business, Financial Industry Regulatory Authority, Media, New York, Penny Stocks, Securities and Commodities Violations, Social Media, Stocks and Bonds, technology, Twitter

Primary Sidebar

More to See

Game Plan Launches Groundbreaking College Athlete Career Development ‘Academies’ Program

GREENVILLE, N.C.--(BUSINESS WIRE)--Employers aiming to win the war on talent have a new “A” team to tap into: college and professional athletes. … [Read More...] about Game Plan Launches Groundbreaking College Athlete Career Development ‘Academies’ Program

Mortgage demand sinks even as rates drop

People wait to visit a house for sale in Floral Park, Nassau County, New York.Wang Ying | Xinhua News Agency | Getty ImagesMortgage rates dropped for … [Read More...] about Mortgage demand sinks even as rates drop

Mortgage Rates May Stay on the Up Escalator in July

Mortgage rates are likely to rise in July, extending a seven-month streak. High inflation, and the Federal Reserve's efforts to control it, have … [Read More...] about Mortgage Rates May Stay on the Up Escalator in July

Copyright © 2022 · Republica Press · Log in · As an Amazon Associate we earn from qualifying purchases.

Terms and Conditions - Privacy Policy