SEC Charges Market Manipulation For False Tweets

November 13, 2015

While some companies have recently used social media for the release of material news, caution may be warranted for a medium that is vulnerable to abuse. The SEC recently announced market manipulation charges arising from false tweets that affected the stocks of two companies. According to the SEC’s complaint, an investor tweeted multiple false statements on Twitter accounts that he deceptively created to look like the real Twitter accounts of well-known securities research firms. The false tweets caused sharp drops in the stock prices of two companies and triggered a trading halt in one of them. Read the SEC press release.

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