SEC charges stock research firm, co-founders with fraud for charging companies to produce supposedly unbiased reports
The Securities and Exchange Commission charged stock research firm SeeThruEquity LLC and its co-founders brothers Ajay and Amit Tandon on Thursday with fraud for issuing research reports that were bought and paid for by the target companies rather than the unbiased research they promoted to investors. According to the SEC’s complaint, SeeThru and the Tandons hid the fact they were receiving several thousand dollars in conference presentation fees for inviting companies to make a "presentation" at an investor conference and giving companies input into the substance of the supposedly unbiased research reports, including the price targets at times. The price targets in SeeThru’s reports were typically 300% more the current trading price of the stock. The SEC also alleges that Ajay Tandon, SeeThru’s CEO, frequently traded in the same stocks that his firm was evaluating including scalping. SeeThru’s Tandons frequently stated in published interviews and elsewhere that neither the firm nor its principals traded in securities for which they published research. Scalping is where a perpetrator makes a stock recommendation to investors and simultaneously trades against that recommendation in the open market without adequate disclosure. The SEC’s investigation is ongoing.
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