case. 6.8-6.10 notes

case. 6.8-6.10 notes - Unit 6 Section B Personal Ambition...

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Unit 6 Section B “Personal Ambition and Hubris” Case 6.8 Jonathen Lebed: The Middle School Tycoon Johnathen Lebed - 15 year old New Jersey middle school student - SEC charged him with securities fraud “Pump-and-Dump”: Lebed would buy shares of stock and then post positive info about the stock around the internet in various chat rooms. Then, he would sell that stock and start the process again with a new stock. Lebed was the first minor ever prosecuted by the SEC for securities fraud. Michael Lewis conducted an interview on the case. In an interview with Richard Walker, the head of enforcement for the SEC, Lewis asked why Lebed’s conduct was considered different than that of an analyst. Lewis claimed that Lebed was trying to manipulate the market . -“To manipulate the market”: when you promote a stock for the purpose of artificially raising its price Today: - Lebed runs a website where he touts stocks. He says he never thought he was doing anything wrong. Case 6.9 Whole Foods but Not Full Disclosure John Mackey - CEO of Whole Foods He posted positive messages about Whole Foods in online chat rooms. - Some has negative comments about Wild Oats (a similar company which Whole Foods was trying to acquire). - When his identity was discovered he stopped posting and apologized. -
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case. 6.8-6.10 notes - Unit 6 Section B Personal Ambition...

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