The Securities and Exchange Commission is Sleeping On Their Job

The biggest problem on Wall Street is allowing crooks to manipulate penny stocks in the Over-The-Counter market (OTC). Many investors, mostly beginners, are losing thousands of dollars everyday from trying to grow rich from penny stocks. A penny stock is a stock that trades under $5.00 and is trading in the OTC market, which is not an actual exchange like the New York Stock Exchange or the NASDAQ. The OTC market is “A network of companies that serve as ‘market makers’ in particular low-priced and thinly traded stocks”(

The Securities and Exchange Commission is letting these crooks control the OTC market by running pump-and-dump scandals. A pump-and-dump is “A form of microcap stock fraud that involves artificially inflating the price of an owned stock through false and misleading positive statements, in order to sell the cheaply purchased stock at a higher price. Once the operators of the scheme ‘dump’ their overvalued shares, the price falls and investors lose their money”( Don’t get me wrong, there has been many crooks who have been caught and got what they deserve, but there are hundreds more of them out there controlling the market everyday! If you research just a tad bit about the OTC market, you will find that every article or newspaper will mention that it is purely manipulated. Why is the Securities and Exchange Commission not doing anything about this knowing that these scandals are going on everyday? The OTC market is a crooks playground to make a quick buck while investors eventually go broke.

Penny stock promoters are the key to the pump-and-dump scandals. Search “Penny stock promoters” on your search engine and witness thousands of them pop up with misleading information. Penny stock promoters also work together with other promoters to increase their leads (investors). The Securities and Exchange Commission should ban penny stock promoters who are being paid millions of dollars to promote promising returns on investments to individuals who invest in the crooks fake company. Pump-and-dump scams are successful when the hype is there, which is the job of these promoters – to fool many investors in order to create a buying frenzy for the insiders to sell their shares at a higher price. Ever seen the movie “Boiler Room”? Well, it’s not a fiction. How about “Enron”, have you heard of that company? One of the largest pump-and-dump scheme in history. The OTC market is full of Enron companies that are getting away with fraud!

The Federal Bureau of Investigation has released several articles regarding complaints about these penny stock scams. One article explains, “So far, our joint investigation has uncovered more than 40 schemes, convicted 40 perpetrators , identified thousands of victims in nearly every state and several foreign countries, and discovered hundreds of millions of dollars in losses” ( So, the Federal Bureau of Investigation and the Securities and Exchange Commission both know about these scandals going on, why can’t they set more regulation into the OTC markets to stop these fraudulent events? Or better yet, why can’t they just get rid of the OTC market if it does no good to anyone but crooks? Stocks are placed on the OTC market for a reason – they do not meet the criteria to be placed on the New York Stock Exchange or the NASDAQ. Well, if that’s the case, then why should the company be allowed to go public and cause individuals thousands of dollars in losses? The Securities and Exchange Commission, so called ‘watchdogs’, need to wake up and take action now.

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26 Responses to The Securities and Exchange Commission is Sleeping On Their Job

  1. tommyb1984 says:

    Interesting take, take a stock like FNMA for example it was a 80$ stock what should the committee do if it drops from 80 al the way to .01 or .000001

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