Tag: noneconomical trading

The SEC defines “noneconomical trading” as trading for which there is no economic rationale. The SEC considers noneconomical trading a key factor in determining whether someone engaged in efforts to manipulate the market for a public company’s shares. This is typically seen in the market for small cap and micro-cap companies shares. The SEC considers noneconomical trading to be a sign of a violation of the anti-market manipulation provisions of the Exchange Act of 1934.

SEC Obtains Final Judgment in AutoChina Market Manipulation Case

In 2012 we 1st took a look at the SEC enforcement action against AutoChina International for market manipulation. Roughly two (2) years later, the SEC has obtained its first judgments against the company and its principal executive officer in this case.

Market Manipulation and “Noneconomical Trading”

Coral Capital Partners looks at a SEC Enforcement Action for market manipulation and non-economical trading. This is an extremely interesting look at the manipulation of the public market for a micro-cap company’s common stock, how it was accomplished, and the penalties imposed. We also look at the SEC ‘s definition of these types of market manipulation and where they run afoul of the Exchange Act of 1934. This blog and the associated SEC Litigation Release and Complaint filed in Federal Court provide a very interesting read.