Investor Relations in the 21st Century

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Friday, January 13, 2012

SEC targets social media scams

As originally posted on Inside Investor Relations.

 Commission charges investment adviser and issues two risk alert bulletins covering securities fraud and social media


The SEC has charged an Illinois-based registered investment adviser with fraudulently offering more than $500 bn in fictitious securities through various social media websites, signaling an aggressive stance by the regulator in monitoring online investment activity.

The charges against Anthony Fields, 54, allege that he used LinkedIn discussions, among other social media sites, to promote fictitious ‘bank guarantees’ and ‘medium-term notes’ resulting in interest from multiple purported potential buyers.

The fictitious securities were allegedly offered through Anthony Fields & Associates and Platinum Securities, both entities founded by Fields who serves as president, chief compliance officer and sole control person, according to the complaint.

The SEC called for a ‘cease and desist’ hearing within 60 days to look into the matter and demanded a response from Fields.

In an earlier letter to the SEC dated last July, Fields denied the allegations, stating that the charges are ‘an attempt to describe me and my character as a spin-off of Dr Jekyll and Mr Hyde, and…  a flagrant attempt to tarnish me and my firms’ reputation and a very opinionated statement.’

Efforts to reach Fields yesterday were unsuccessful.

Investor alerts

The SEC used the occasion of the charges to issue two risk alert bulletins aimed at investors and investment advisers.

‘Social media is landscape-shifting’, an investment adviser alert notes, describing the need for investment advisers to examine and monitor their firm’s compliance programs relating to the use of social media.

In a separate alert to investors, the SEC notes that the rise of social media ‘present opportunities for fraudsters’ due to their low cost, ease of launching a legitimate-looking website and anonymity, which makes it difficult to identify who is behind an investment offering.

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