The Securities and Exchange Commission Friday suspended trading in securities of 15 companies because of "questionable trading and social media activity."
The agency said it did so as part of its continuing effort to respond to "potential attempts to exploit investors during the recent market volatility."
The Friday action "follows the recent suspensions of the securities of numerous other issuers, many of which may also have been targets of apparent social media attempts to artificially inflate their stock price," the agency said in a statement.
Nick Morgan, partner at legal defense firm Paul Hastings and a former SEC trial attorney, told ThinkAdvisor Friday in an email: "I have no doubt that the SEC is paying closer attention to the impact of social media posts now than it was prior to the political furor over GameStop."
According to Melissa Hodgman, acting director of the SEC's Division of Enforcement, the SEC's "recent suspensions of trading in nearly two dozen securities — including 15 today — are one facet of our ongoing efforts to police the market and protect investors."
Regulators, she explained, "proactively monitor for suspicious trading activity tied to stock promotions on social media, and act quickly to stop that trading when appropriate to safeguard the public interest. We also remind investors to exercise caution and do their diligence before investing generally, including in companies promoted on social media."
The SEC order also states that none of the issuers has filed any information with the SEC or OTC Markets, where the companies' securities are quoted, for over a year.
