MANHATTAN (CN) - An upstate penny stock promoter defrauded investors by pumping stock on his website while dumping millions of his own shares for nearly $3 million, the SEC says. It sued Christopher Wheeler, of Victor, N.Y., and his website, OTCStockExchange.com.
The issuers of the thinly traded penny stocks paid Wheeler millions of shares as undisclosed compensation, in exchange for which he pushed the stock on OTCStockExchange.com, and posted "lofty price predictions for the stock without any reasonable basis for those projections," the SEC said.
If and when his pumping brought a "dramatic, but temporary, increase" in the volume of shares traded, and the price, Wheeler dumped his own shares, the SEC said.
The SEC seeks disgorgement and an injunction warning Wheeler that he should never do such a thing again. Ever.
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