Watch Twitter For The Next Round Of SEC Halts For Stock Promotion
April 14th, 2009 at 9:35 am Posted by The Dean
Back on 3/20/08 the SEC halted the stocks of three companies for promotional videos on youtube.com: NTCX, YNGR and GPKE. These halts by the SEC were the first of their kind for promotional activities on social media websites… but The Dean thinks they certainly won’t be the last!
Social media stock promotions are catching fire— and the latest trend seems to be stock promotions on Twitter.com. Now while stock promotion is legal… if you don’t disclose payment then you’re violating SEC regulations.
While Twitter.com should be utilized by every company (both public and private) for marketing purposes… there’s a big difference between good tweeting & bad tweeting. I’ll use CVIC as an example of bad tweeting.
CVIC already has 1,816 followers but only 27 twitter updates. And most of those updates are promoting their own stock… ultra risky move for SEC halt IMO!
They also claim to be the “first public co in medical marijuana biz” but that’s completely false… there were plenty of otherscams stocks that tried the medical marijuana angle (google Amigula). There’s even another publicly-traded marijuana scam stock spamming on twitter! The symbol is GFON.
So any public company utilizing twitter.com… you’re walking a very fine line and should get in contact with the pro’s @ http://www.intelligendo.com. Their expertise is social media for public companies and they understand the in’s & out’s.
In my opinion, the year 2009 will see numerous counts of stock halts by the SEC for undisclosed stock promotions using Twitter. So before the SEC warns you on such illegal activity… take it from The Dean. You don’t want to be caught holding the stock of any company risking a halt from the SEC on the likes of twitter stock promotion.
