SEC Operation Spamalot: Suspends Trades Of 35 Companies Promoted By Stock Spam
from the take-that dept
In the last year or so, stock spam has grown in popularity tremendously. Apparently (and somewhat amazingly) it's incredibly successful for the spammers. It's a bad bet for the recipients of the spam, who are quite likely to lose money investing in those stocks. However, it appears that there are plenty of suckers out there who believe the stock spam and get taken. In fact, with stories of porn spam on the decline, it seems like many spammers have figured out that focusing solely on stock spam is definitely the easiest way to make a quick buck. So what's the government to do? There have been some attempts at education campaigns, but today the SEC stepped it up with their own "Operation Spamalot" (yes, that's really what they're calling it) and suspended the trading of 35 companies featured in stock spam. These aren't minor suspensions either -- but will last a minimum of 10 days. The stocks are all OTC stocks, so not subject to much in the way of regulatory oversight compared to stocks listed on the various exchanges.
Of course, there are some big questions raised by this. While some stock spammers are spamming in conjunction with the business owners, for many others the people at the company have no idea that their stock is being used as part of a pump-and-dump scam. However, even if they're not involved, their stock is now frozen. Of course, considering that most of these stocks were of the penny stock variety, it probably doesn't make that much of a difference. And, while the SEC doesn't say so directly, it sounds like they believe the companies are likely to be involved in the spamming. It will be interesting to see what happens after the 10 days are up and how many of the stocks start trading again. Even more interesting, though, will be to see how this impacts the stock spam business. Chances are that stock spammers will quickly move on to another set of stocks, and this won't slow them down a bit. After all, there are plenty of OTC penny stocks out there, and many more suckers to fleece.
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short by Ayal Rosenthal on Mar 8th, 2007 @ 8:07pm
I've always thought about shorting those types of stocks whenever I get such an email.
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by Anonymous Coward on Mar 8th, 2007 @ 8:50pm
Stock Spam FTW
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Spamalot? by The Swiss Cheese Monster on Mar 8th, 2007 @ 9:42pm
I think the SEC might be looking for a lawsuit. That sounds like it might break the bounds of fair use.....
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Re: short by Lawrence D'Oliveiro on Mar 9th, 2007 @ 2:28am
Yeah, that's what I thought, too. How come more people don't do it? Or do they do it but refrain from bragging about it? :)
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for those interested in what spamstocks do by Cestan on Mar 9th, 2007 @ 3:01am
http://www.spamstocktracker.com/
a nice and fun site
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Re: short by Gordon Gecko on Mar 9th, 2007 @ 4:10am
Ummm.....OTC stocks can't be shorted.
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by John on Mar 9th, 2007 @ 6:31am
Thanks Cestan...I always wondered about where those stocks were going after I got the spam! I thought about shorting them too, thinking it was indeed possible...
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Short-term performance? by Heath Ackley on Mar 9th, 2007 @ 10:17am
Well, these appear to be pump and dump schemes. Which means, you could make some great money if you buy the day after you get a spam e-mail and sell before the market closes that afternoon. Over any long period, the risk in these companies is like buying junk bonds times 10. Actually, I wonder if a monte carlo simulation could be run on OTC stocks and give them credit ratings? Overall recommendation: drag and drop into trash.
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by a on Mar 9th, 2007 @ 10:32am
You really don't want to get involved with these type of stocks. You just never know exactly what game is being played, while the people playing them do.
Maybe its being done by a brokerage company that is planning to sell what they own, and they just want to firm the price up so when they move it doens't go down. Maybe its a pump and dump, maybe someone just decides to hurt someone that day.
Wall Street is fucked up, houses will see a competitor take a short position and drive the price up, just to crush someone. Never bet money that matters when the big boys are just playing a game.
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Reverse pumping by |333173|3|_||3 on Mar 10th, 2007 @ 3:02am
if you want to get an competitor into trouble (say before a buyout), you could start a fake pump-and-dump and get them into a lot of trouble. If the SEC announces that there appears to be something underhand going on, the company's stock is likely to fall.
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trade google instead by chris on May 15th, 2007 @ 4:29pm
a 4th grader can trade google. Learn flags and pennants. Here is last weeks google chart with technical analysis.
http://www.naughtyconnect.com/z.jpg
I trade goog once per day. 70% of the time i am right.
Happy trading.
-Chris
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by Warren P. Buffet on Jul 3rd, 2008 @ 6:08am
I predict that Merrill Lynch will go brock and have to file bankruptcy within the next 9 mos. as stock sale volumes dewinder.
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