December 12, 2011
SEC Charges Penny Stock Promoter with Touting Stock of Clients
The SEC charged Geoffrey J. Eiten and his company National Financial Communications Corp. (“NFC”) for making material misrepresentations and omissions in a penny stock publication they issued. The SEC alleges that Eiten and NFC publish a penny stock promotion piece called the “OTC Special Situations Reports” that promotes penny stocks on behalf of clients in order to increase the price per share and/or volume of trading in the market for the securities of penny stock companies. The complaint alleges that Eiten and NFC have made misrepresentations in these reports about the penny stock companies they are promoting. According to the complaint, Eiten and NFC were hired to issue the reports and used false information provided by their clients, without checking the accuracy of the information.
In its complaint, the Commission seeks permanent injunctions, disgorgement plus prejudgment interest, civil penalties, and penny stock bars pursuant to Section 21(d)(6) of the Exchange Act against the defendants.
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