"Let us revisit ZSUN's press releases:"
By: frisky $$$
Reply To: None Sunday, 2 Jul 2000 at 1:50 PM EDT
Post # of 23384
Section 17 (b) of Securities Act of 1933 clearly prohibits a party touting a stock without disclosing the amount of compensation. ZSUN was touted by Securities Capital Trading, Access 1 Financial, Stockreporter.com, Dirks & Company with strong-buy recommendation. ZSUN quoted their pseudo-researches through its official press releases. The amount of compensation has never been disclosed.
Let us revisit ZSUN's press releases:
(A) November 19, 1999:
Strong Buy Issued on Zia Sun technologies by Securities Capital Trading. Near-term Price Target over $15 Per Share with Long-term $30 Price Target.
(B) December 10, 1999:
Access 1 Financial Issues Buy Recommendation with $36 12-Month Projection on Ziasun Technologies.
(C) February 7, 2000:
Stpckreporter Issues Strong Buy Recommendation of $28.50 Year 2000 Share Price Target.
(D) April 20, 2000:
Dirks Issues Strong Buy on Ziasun Technologies. ...We believe Ziasun can commend a $1 billion market capitalization within 6-9 months, implying a target stock price of $30/share; ...a 12-18 month target price of $60/share represents a multiple of less than 40 times that year's earnings....
Yes, touts can promote garbage as gold and are protected under First Amendment. However, they must observe Section 17 (b) of Securities Act of 1933.
Several insiders filed statement 144 to sell ZSUN while the pseudo-analysts were touting the stock. The stock plummeted.
IMHO, ZSUN, Securities Capital Trading, Access 1 Financial, Stockreporter.com, and Dirks might all have violated Section 17 (b) of Securities Act of 1933.
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