Scammers Used SeekingAlpha for Bogus Stock Promotions, SEC Says
- Regulator fines firms that made payments to article writers
- Authors received compensation for publishing bullish research
Pedestrians walk along Wall Street near the New York Stock Exchange (NYSE) in New York, U.S., on Monday, Oct. 31, 2016. U.S. stocks rose from a six-week low amid an increase in deal activity as traders assessed the outlook for the presidential election and interest rates in the world's largest economy.
Photographer: Michael Nagle/BloombergSeekingAlpha.com tries to ensure that research published on its popular investing website is unbiased by requiring writers to disclose whether they’ve been paid for touting stocks. But U.S. regulators say there’s an easy work around: lying.
On Monday, the Securities and Exchange Commission sued 27 individuals and companies for their involvement in hundreds of conflicted articles that appeared on SeekingAlpha and other sites. The authors checked a box that said they hadn’t been compensated, concealing the payments they’d received from stock promoters, the SEC said in a statement.