Today's Lesson: Don't Buy Penny Stocks Off Facebook

Or don’t buy penny stocks at all.  If someone is touting a penny stock, on the web or in person, every instinct inside of you should be asking the simple question of “why is this ‘great’ information being offered to me?”

Props to the SEC for taking down this internet-based scam…

SEC Charges Two Canadians With Fraudulently Touting Penny Stocks on a Website, Facebook and Twitter

FOR IMMEDIATE RELEASE
2010-114

Washington, D.C., June 29, 2010 — The Securities and Exchange Commission announced today that it has obtained an emergency asset freeze against a Canadian couple who fraudulently touted penny stocks through their website, Facebook and Twitter. The SEC also charged two companies the couple control and obtained an asset freeze against them.

According to the SEC’s complaint, the defendants profited by selling penny stocks at or around the same time that they were touting them on www.pennystockchaser.com. The website invites investors to sign up for daily stock alerts through email, text messages, Facebook and Twitter.

The SEC alleges that since at least April 2009, Carol McKeown and Daniel F. Ryan, a couple residing in Montreal, Canada, have touted U.S. microcap companies. According to the SEC’s complaint, McKeown and Ryan received millions of shares of touted companies through their two corporations, defendants Downshire Capital Inc., and Meadow Vista Financial Corp., as compensation for their touting. McKeown and Ryan sold the shares on the open market while PennyStockChaser simultaneously predicted massive price increases for the issuers, a practice known as “scalping.”

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Josh here.  No one is sharing “confidential information” about a stock that “could go up 1000%” out of the goodness of their hearts.  It’s always a scam. 

Score one for the good guys with these crooks out of the game

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  1. Eat Verts commented on Sep 23

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