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SEC v. Craig.

On November 5, 2015, the Securities and Exchange Commission (“SEC”) filed securities charges against James Alan Craig, a 62-year-old Scottish trader.[1]  The SEC’s complaint concerns Craig’s use of Twitter accounts to commit securities fraud by making false statements about publicly traded companies in order to manipulate the price of those companies’ exchange-traded securities.  Just as the SEC warned in the investor alert of fraudsters who conceal their true identities by mimicking credible sources of market information, the complaint alleges that Craig created the Twitter accounts to mislead the public into believing that tweets issued from those accounts were from established securities research firms. … Read the rest

On November 5, 2015, the Securities and Exchange Commission (“SEC”) issued an investor alert to warn investors about fraudsters who attempt to manipulate share prices through social media.[1]  For a full text of the investor alert, click here.  With the prevalence of social media and their increasing usage in market research, this seems to be a particularly appropriate topic for an investor alert.

In the investor alert, the SEC warned that, while social media can provide many benefits for investors, such as stock research and up-to-date news, it also presents opportunities for fraudsters to spread false or misleading information about a stock to large numbers of people with minimum effort and at a relatively low cost. … Read the rest