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SEC Charges Self-Described Promoter With Microcap Market Manipulation Scheme

Posted on November 29, 2018 at 4:10 PM

The SEC charged a self-described penny stock promoter and an entity he controlled with orchestrating a scheme to manipulate trading in at least 97 microcap stocks.

According to the SEC’s complaint:

  • Eric Landis of Charlottesville, Virginia, falsely claimed to third-party media buyers for microcap companies that he would distribute promotional materials for the stocks via email lists with tens of thousands of subscribers.
  • In reality, his distribution lists were a sham. To generate trading volume and create the false impression that he was drumming up investor interest, the SEC alleged that Landis traded thousands of microcap shares himself using brokerage accounts in his own name, in the name of an entity he controlled, Ridgeview Capital Partners LLC, and in the names of several third parties. 
  • Altogether, the SEC alleged that Landis placed thousands of manipulative trades over three years, including approximately 1,300 “matched trades,” which involved simultaneously selling and buying stocks in the microcap companies he was paid to promote.

The SEC’s complaint, filed in the U.S. District Court for the District of Massachusetts, chargedLandis and Ridgeview with violating the antifraud and market manipulation provisions of the federal securities laws. The SEC is seeking a permanent injunction against future violations, disgorgement of ill-gotten gains plus prejudgment interest, monetary penalties, and a penny stock bar.

Landis was previously found liable in a lawsuit brought by the SEC and convicted of related criminal charges based on his role in a prior market manipulation scheme. Before investing, microcap investors should review the investor-education materials available at Investor.gov.

Read More:
Release
https://www.sec.gov/news/press-release/2018-266" target="_blank">https/www.sec.gov/news/press-release/2018-266

Complaint
https://www.sec.gov/litigation/complaints/2018/comp-pr2018-266.pdf" target="_blank">https/www.sec.gov/litigation/complaints/2018/comp-pr2018-266.pdf

Investor Alert
https://www.investor.gov/news-alerts/investor-alerts/investor-alert-fraudulent-stock-promotions" target="_blank">https/www.investor.gov/news-alerts/investor-alerts/investor-alert-fraudulent-stock-promotions

Categories: Fair Dealing