SEC cracks down on manipulation via social media

The Securities and Exchange Commission (SEC) has cracked down suspected market and price manipulation via the use of social media by several persons.

In a series of actions last week, the SEC issued caution and warning notices on four persons found to have engaged in alleged manipulation. One case was a publication of certain comments on the securities of Softlogic Life Insurance PLC (AAIC) listed on the Colombo Stock Exchange, in a WhatsApp social media group named – “Investing”, in and around January 2023 that tantamount to recommendations being made to influence other investors to make investment decisions regarding those securities without a proper basis.

SEC cracks...

Another was a publication of certain comments on certain securities listed on the Colombo Stock Exchange, in a WhatsApp social media groups named – “CSE Small Investors 2”, “Investor’s Mind”, “CSE Smart Investors”, “Smart Investors”, “Investing”, “Investment Forum”, during the period October - December 2022 which would tantamount to recommendations being made to influence other investors to make investment decisions regarding those securities without a proper basis.

SEC also cautioned a person for the publication of certain comments on certain securities listed on the Colombo Stock Exchange, in a WhatsApp social media groups named – “Modern Share Market CSE”, “Modern High Network Hub” during the period August to September 2022 which would tantamount to recommendations being made to influence other investors to make investment decisions regarding those securities without a proper basis.

In another action, the SEC warned another for the publication of certain comments on certain securities listed on the Colombo Stock Exchange, on the social media platform named – Twitter during the period September - October 2022 that would tantamount to recommendations being made to influence other investors to make investment decisions regarding those securities without a proper basis and thereby even contribute towards creating a false market in respect of those securities; and utilising the CDS Accounts of third parties without prior written authorisation.