August 11, 2006

Cyber version of pump and dump

By Ben Cunningham
Interesting report on the 10Q Detective Blog about a web based pump and dump operation. 10Q detective along with other blogs like Footnoted is doing a great job of investigating obscure corporate SEC filings. This is another great example of how the blogosphere is holding large, heretofore unaccountable, institutions accountable.

On August 1, the SEC (Commission) charged Nicholas A. Czuczko, age 34, with civil securities fraud. Mr. Czuczko, the operator of a stock picking website, allegedly made more than $2.7 million in profits by secretly selling the stocks that he recommended as "mega bonus buys" on his site, www.thestockster.com

The Commission's complaint alleges that Czuczko, of Beverly Hills, Calif., routinely recommended obscure, thinly-traded penny stocks on his website while he personally planned to sell the stock into the rising price spurred by the recommendation(s).