Stock Spammer Settles with SEC, Consents to Court’s Judgment
The Securities and Exchange Commission (SEC) has closed the case charging Samuel Aaron Meltzer belonging to St. Paul, Minnesota, for committing securities fraud involving activities relating to stock spam.
The New York's Eastern District Court settled with the final judgment asking Meltzer to make a payment of $159,619.62 in disgorgement, and $89,045.70 in interest. But on the basis of Meltzer's financial condition, he has to now pay only $25,000.
According to the complaint that was filed on February 18, 2003, Meltzer is a professional online spammer who used the Internet to conduct securities fraud. He took money from stock issuers and promoters in return for distributing millions of UCE (Unsolicited Commercial E-mail) and made websites to forward various types of penny stocks.
Meltzer flooded the Internet with his promotional materials. His websites had different URLs and he registered them under different names like GrowthStocks2000 and WiseStocks2000. Meltzer then sent the unsolicited e-mails to potential investors. The messages recommended different stocks and also had links to promotional websites that Meltzer created. Further, these sites posed to originate from legitimate sources.
During 1998 and 2001, Meltzer canvassed stocks on behalf of twelve issuers and earned at least $160,000 in cash and stock. Such were his ill-gotten gains from fraudulent conduct.
According to SEC, Meltzer lied that he recommended the stocks based on his own opinions about market investments. He said that he arrived at those opinions by reviewing the public filings of the issuers and by interviewing their management.
But in reality Meltzer, did neither. He simply published the representations and recommendations of the stock promoters who paid him to do the job. The complaint stated that Meltzer's websites and e-mails misrepresented the prevailing business prospects of the stock issuers as well as their future plans.
The final judgment of the court has imposed on Meltzer further restrictions in addition to the financial penalties. It commands him from acting against the anti-fraud provisions of the federal securities acts. It also bars him from penny stock activities. Meltzer agreed with the court's final word without acknowledging or refuting the allegations the Commission charged against him.
Related article: Stock Spamming On the Rise
» SPAMfighter News - 31-07-2007