The SEC charged three penny stock promoters Anthony Thompson, Jay Fung, and Eric Van Nguyen with conducting pump-and-dump schemes involving stocks they were touting in their supposedly independent newsletters for Blast Applications Inc., Smart Holdings Inc., Blue Gem Enterprise Inc., Lyric Jeans Inc.and Mass Hysteria Entertainment Company Inc. According to the SEC, the defendants worked in coordinated fashion to gain control of a large portion of shares in the stock of these microcap companies and then hyped those stocks in newsletters they distributed to prospective investors. After creating demand for the stock and increasing the value, they sold their holdings at the higher prices and earned significant profits. Once they stopped their promotional efforts, the demand for the stocks subsided and the prices dropped, leaving investors who had purchased the promoters’ shares with significant losses. The defendants allegedly conducted five separate schemes that resulted in more than $10M in ill-gotten gains. SEC
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