SEC Rule 10b-5 is the primary anti-fraud provision of the federal securities laws. It was adopted pursuant to Section 10(b) of the Securities Exchange Act of 1934 (“1934 Act”), as amended and is the primary rule used in securities fraud cases. Violations of SEC Rule 10b-5 can result in SEC civil actions and can also be […]
Read MoreMessage boards and social platforms can move thinly traded and microcap stocks quickly. That speed is exactly why the U.S. Securities and Exchange Commission (SEC) pays close attention to stock promotions on venues such as InvestorsHub (iHub), Stocktwits, Seeking Alpha, and Investor Village. The biggest compliance issue is simple — if a post is “paid [&helli…
Read MorePractical guidance on Rule 144 legal opinions, restrictive legend removal, and transfer agent processing, including shell company and 144 legal opinion considerations.
Read MoreIf you intend to raise money using the regulations for crowdfunding or take your company public, you will need to understand how the SEC’s registration statement requirements work, and how you may be able to raise money from the correct application of federal and state exemptions from registration. Crowdfunding is the solution...
Read MoreA short sale transaction can be part of a legitimate trading strategy if done legally. Illegal Short selling...
Read MoreRule 506 of Regulation D of the Securities Act of 1933 provides a private placement exemption from federal securities registration which is increasingly being used by companies seeking to raise capital prior to going public.
Read MoreBy Securities Lawyer 101 | Securities Lawyers Gone Wild The latest SEC insider trading complaint has many familiar ingredients: confidential merger information, out-of-the-money call options, friends and relatives, alleged kickbacks, and a group chat that appears to have missed the lecture on discoverability. It also has a few less common ingredients, includ…
Read MoreThe Path from OTC to National Exchange Uplisting from the OTC Markets to Nasdaq or NYSE expands investor access, liquidity, and visibility. It requires detailed preparation, compliance with exchange standards, and governance upgrades. Issuers who completed a DPO or registered on Form 10 often view uplisting as the next strategic milestone. In 2026, the pro…
Read MoreEvery initial public offering (IPO) in the United States relies on a team of financial intermediaries known as underwriters. Underwriters are investment banks that guide private companies through the process of going public, manage the sale of securities, and help ensure compliance with federal securities laws. They perform due diligence, negotiate pricing…
Read MoreFor small and mid-size companies, the costs, dilution, and loss of control associated with a traditional underwritten Initial Public Offering (IPO) can outweigh the benefits. A Direct Public Offering (DPO) provides an alternative—allowing the issuer to register its securities directly with the SEC, sell shares without an investment-bank underwriter, and cont…
Read MoreForm 10 Shells occupy a unique niche in the U.S. capital markets. These corporations register a class of securities under the Securities Exchange Act of 1934 (“Exchange Act”) by filing Form 10. Crucially, this registration occurs without a concurrent public offering under the Securities Act of 1933. While this process makes a company an SEC-reporting [&helli…
Read MoreThe digital transformation of finance has blurred the line between investor communication and viral marketing. In the past decade, social media platforms such as X (formerly Twitter), Reddit, and Stock Twits have become dominant channels for investor sentiment and information flow. Their influence has extended far beyond secondary markets—now shaping initial…
Read MoreThe U.S. Supreme Court has agreed to hear a case that could significantly limit the Securities and Exchange Commission’s (SEC) ability to recover illegal profits. The central question is whether the agency must prove that investors suffered actual financial loss before it can order a wrongdoer to “disgorge” their ill-gotten gains. The Supreme Cou…
Read MoreLearn the 2025 website requirements and best practices for SEC-reporting OTC Markets issuers (OTCQX, OTCQB, OTCID). Ensure compliance with Regulation FD, SEC disclosure rules, and OTC guidelines through a transparent, accessible investor relations website.
Read MoreThis article discusses the risks and consequences of toxic convertible financing, also known as "death spiral financing," for small and emerging companies trading on the OTC Markets. These financings typically involve convertible promissory notes that convert into stock at deep discounts to the market price. The core issue is the floating conversion rate tie…
Read MoreThe document outlines common disclosure deficiencies that lead to OTC Markets suspending or downgrading issuers under Rule 15c2-11, which requires current, publicly available information for broker-dealer quotations. Compliance with OTC Markets’ standards ensures transparency, liquidity, and investor trust, while non-compliance risks suspension or downgrade…
Read MoreThe have intensified enforcement in the OTC Markets. The focus has shifted sharply toward broker-dealer gatekeeper obligations, fraudulent stock promotions, and manipulative trading.
Read MoreShort selling — the sale of borrowed shares with the expectation of repurchasing them later at a lower price — plays a legitimate role in market efficiency. However, in the Over-the-Counter (OTC) Markets, where liquidity and transparency remain limited, short selling can be disruptive and manipulative when misused.
Read MoreIn the age of social media, financial influencers, or “finfluencers,” have become powerful voices in shaping investment decisions. With large followings on platforms like TikTok, Instagram, YouTube, and X, finfluencers offer financial advice, promote investment products, and share trading strategies, often in an engaging, relatable style. While t…
Read MoreOn March 11, 2025, the Public Company Accounting Oversight Board (“PCAOB”) issued an Order Instituting Disciplinary Proceedings, Making Findings, and Imposing Sanctions, permanently revoking the registration of Accell Audit & Compliance, P.A. (“Accell”). The PCAOB is a nonprofit corporation created by the Sarbanes–Oxley Act of 2002 that regul…
Read MoreOn December 10, 2024, a federal grand jury in Dallas, Texas, returned an indictment charging a Texas businessman for his role in a yearslong scheme involving at least five publicly traded companies. According to court documents, Philip Verges, 59, of Dallas, controlled five publicly traded companies, which he used to engage in an investment fraud […]
Read MorePublished: January 6, 2025 On December 11, 2024, Clinton Greyling, 50, of Tamarac, Fla., was sentenced by U.S. District Court Judge Richard G. Stearns to one year of probation. He was also ordered to perform 200 hours of community service and to forfeit $229,576. Greyling was charged on July 30, 2024 with one count of […]
Read MoreOn December 11, 2024, the Securities and Exchange Commission (the “SEC“) filed a complaint in the United States District Court for the District of Utah charging five individuals and three entities for their roles in a fraudulent scheme to secretly acquire and dump into public securities markets millions of shares of microcap stocks. Utah [&hell…
Read MoreWhile going public offers many benefits, it also comes with risks and a large number of regulations with which issuers must become familiar. Despite the risks, the U.S. capital markets remain one of the most attractive sources of financing in the world. Going public is a complicated and intricate procedure. So, it is essential to […]
Read MoreMore and more issuers going public opt for a direct public offering. Unlike an Initial Public Offering (IPO), in a direct public offering, the issuer sells shares of its stock directly to investors rather than through an underwriter. Going public transactions using a direct public offering eliminates the costs and risks associated with a reverse merger trans…
Read MoreCompanies become subject to the SEC’s periodic reporting requirements in several ways, including by filing a registration under the Securities Act of 1933, as amended or pursuant to the Securities Exchange Act of 1934. The SEC's periodic reporting rules require that publicly traded companies disclose a wealth of information to the public. Periodic reporting…
Read MoreProspective For Underwriters & Broker-Dealers: Due Diligence Considerations Unlike traditional Initial Public Offerings (“IPOs”), there is no potential liability for issuers under Section 11 of the Securities Act in connection with Regulation A+ offerings. Sellers in Regulation A+ offerings are potentially liable under Section 12(a)(2) of the Securities…
Read MoreForm S-1 Benefits & Going Public When a company sells shares, the shares must be covered by an effective registration statement or be exempt from the Securities & Exchange Commission’s registration statement requirements. Form S-1 is the most commonly used registration statement form. The form offers issuers flexibility, allowing them to structure th…
Read MoreWhat Is Investor Relations? Investor relations or stock promotion involves disseminating information about a public company to increase its stock price and/or trading volume. The person who publishes this information is sometimes referred to as a “Stock Promoter”, “Investor Relations Provider” or “Stock Tout”. How Do Investor Relations Firms Promote A Stoc…
Read MoreOn March 19, 2024, the U.S. District Court for the District of Massachusetts entered final judgments against California resident Kevin C. Dills and two entities that Dills controlled, Bright Star International, Inc. and Life Sciences Journeys, Inc. In June 2023, the SEC charged Dills and Joseph A. Padilla for their roles in a fraudulent stock-selling [&helli…
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