Professor Podgor over at the White Collar Crime Prof Blog points us to this Securities and Exchange Commission press release that describes the SEC’s lawsuit against some Houston-area telemarketers who are taking a rather creative approach to soliciting purchases of six microcap stocks.
Turns out that the stock promoters left hundreds of thousands of fraudulent “wrong number” stock tip messages in which a woman by the name of “Debbie” would leave a hot stock tip message on the phone recipient’s voice mail and would leave it in such a way to make the recipient believe that “Debbie” had dialed the number by mistake and had really meant to call a friend to pass along the hot stock tip.
The SEC complaint alleges that the messages were part of a larger scheme enabling the Houston-based stock promoters (Peter S. Cahill of Houston and Cahill’s Clearlake Venture Group) to sell approximately $4.5 million of one of the touted stocks through a Tampa, Fla.-based broker-dealer. The SEC alleges that the scheme drove up the price of each of the touted stocks, temporarily inflating their combined market capitalization by approximately $180 million.
Gosh, what is the world coming to? You can’t even trust those hot stock tips mistakenly left on your voicemail anymore? ;^)
Houston's Clear Thinkers
Longtime Houston attorney Tom Kirkendall's observations on developments in law, business, medicine, culture, sports, and other matters of general interest to the Houston business, professional, and academic communities.
Yes, itís difficult to know how people today could fall for this sort of scheme. If theyíll fall for this, there must be an awful lot of people out there getting cases of penis crËme and bankrupting their accounts sending money to get King Jose out of the Ecuador. Nevertheless, the phone calls from people like this are undoubtedly annoying, and they seem only worse in the age of cell phones. One of the downsides of cells is that they are always with you. You can never be out. This has several effects. First, it means that marketers donít really need a specific time to call anymore ñ any time is fair game, since weíre always willing to answer. Secondly, there is this tension between wanting to know who is calling and wanting to protect our own cell numbers that results in never really knowing for sure whose on the other end of the phone. Most of the time thereís a number, but no name. I always feel I have to answer in case it is someone who knows me. If I donít, and it turns out to be my mother-in-law, Iím in trouble. Because like marketers, she canít understand why anyone wouldnít answer his phone since he always has it. Sometimes I miss land lines.
We live in the technological information age we ourselves created. As Einstein once noted, technological advances are always morally neutral. The aim of recent advances in technology is to make exponentially more information much more readily available and at faster and faster speeds. For the average consumer and citizen, this is a positive benefit. It means we can get answers to our questions more quickly, that we can find directions to a restaurant in minutes if we need them. The problem is, the amount of information and ease of access is available to people who seek to do harm just as it is to those of us who use it for good. Hackers, virus makers, and data miners all know how to use the same technology to their advantage. And in truth, as with the atom bomb, the only way to truly protect ourselves from annoyances produced by new technology is to give up the technology altogether.