On May 14 a Bulgarian is said to have moved the share price of consumer company Avon Products by making a false filing to the Securities and Exchange Commission.
The false Avon filing, which was widely disseminated by the Edgar system and said that a (fictitious) private equity firm called PTG Capital would submit a bid to buy the very real and publicly-listed cosmetics company Avon.
The Bulgarian allegedly made $5,000 says the SEC.
The SEC lacks the resources to monitor every filing it processes before sharing it with the public. The volume of paperwork would just be too much.
The Avon M&A scandal is not the only example of hackers using false filings in an to attempt to dupe a bigger cross-section of market players. Criminals have also tried to fool reputable public relations companies with false reports in hopes of catching investors off-guard.
Jeffrey Newman represents whistleblowers