The SEC's Sting.com

Securities and Exchange Commission runs a nationwide 'sweep' of Internet fraud.

  • Share
  • Read Later
The SEC has been doing its surfing. On Wednesday the commission announced an orchestrated -- and unprecedented -- coast-to-coast operation to combat insider trading, Internet-style. Targeted, in 23 coordinated filings, were 44 "individuals and companies across the country, for committing fraud over the Internet and deceiving investors around the world," according to the commission's press release.

The offenses are of the kind that veteran Net hounds know all too well: Spams, message board postings, newsletters and web sites touting surefire "microcap" stocks -- and lying about whether the solicitations were from people with vested interests. That sort of hanky-panky has always been the SEC's raison d' tre -- but today's big sting is proof of how much the Internet version scares the commission. "One of the big problems with the Internet investing has always been a lack of accountability -- anyone can say whatever they want without their motives being examined," says TIME Wall Street columnist Daniel Kadlec. "Anyone who listens, and acts on it, is taking a big chance." It's comforting that the SEC is on the case -- but when it comes to the lightning-quick, ephemeral Web, caveat emptor is still your best bet.

Eleven on the SEC's Hit List:

  • Stocks to Watch
  • The Future Superstock
  • Princeton Research
  • Sitra Enterprises
  • Liberty Capital
  • Global Penny Stocks
  • Starwood Media Group
  • The Taxin Network
  • Emerging Company Report
  • Core Communications Group Inc.
  • National Investors Council