The U.S. Securities and Exchange Commission (SEC) has suspended trading in a dormant company amid concerns about a coordinated effort on social media to pump up the stock.
The SEC halted trading in SpectraScience Inc., a company that has not filed financial reports since 2017 and appears to be inactive, citing questions about recent trading in the company’s stock and online promotion of the stock.
“Certain social media accounts may be engaged in a coordinated attempt to artificially influence the share price of SpectraScience,” the SEC said in its order.
The regulator noted that trading in the company’s shares increased but that there’s been no news from the firm.
“This is a reminder that investors should exercise tremendous caution when investing based on social media or a sudden surge of enthusiasm for a particular security, especially where that interest does not appear tied to any news about the company or industry,” said Melissa Hodgman, acting director of the SEC’s enforcement division.