Re: question about touting stocks...
the other angle is the stock manipulation angle. if you make statements or take actions that are designed to manipulate the price of a security, it's illegal.
for example, if i take a low volume stock that trades, say 10,000 shares a day. then i buy a bunch of shares. after that, i send private messages alerting my friends to buy shares. following that i write blogs, post messages, send tweets to thousands of my followers that 'this is the most undervalued stock' etc. etc., thereby causing the price to rise, and during that time i sell some or all of my shares at a profit. well the sec will likely view this behavior as illegal (falling under touting or scalping provisions).
you could read about the tokyo joe case as an example:
http://www.sec.gov/news/press/2001-26.txt
tokyo joe was charging for his services. there are others you can read about that should follow the pattern above on the sec website.
the key is that if you have thousands of followers and you specifically offer picks to them, you can be held to account. if you are just posting a message on a board etc., it won't fit into that category.
also you can google:
site:sec.gov touting
site:sec.gov scalping
site:sec.gov manipulation
and get some idea of the types of actions that are brought.
http://www.sec.gov/litigation/litreleases/lr15956.txt
http://www.sec.gov/litigation/litreleases/2009/lr21204.htm
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 Reply to cashrich - Msg #2101430 - 03/18/2011 03:31
question about touting stocks...
if a person says, "PLUG will prolly go to 1.00" is that illegal?
what does the SEC consider illegal touting anyways?
from what i can tell from the internet 1. false information 2. non-disclosure of compensation 3. non-disclosure of ties to company.
so, if it doesnt fall within these 3 thing, it's ok under freedom of speech?
i like this business, but i want to keep everything legal, so want to learn as much about this subject. thanks.
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