DD Support Board and Research Team

[TenKay]

“The SEC can ALLEGE a false, fraudulent statement is a basis for action, butt absent a court finding in an Article III courtroom, any action to squelch that speech or preempt trading of a security on the unproven suspicion of false, fraudulent speech, is IMO a serious over-extension of administrative agency authority and is analogous to prior restraint of the press. “

But that is not what is happening. They are suspending a stock for a maximum of 10 days out of concerns that something is seriously amiss. The stock returns to trading after 10 days...albeit on the grey market. But nowadays with the Expert Market that is not really much of an issue in terms of liquidity.

The point is, the SEC has very limited unilateral authority here. There IS due process if civil or criminal charges are brought and the SEC/DOJ has to prove them according to the relevant standard.

What the actual issue seems to be is that the market’s reaction to a suspension can be severe. But that is not on the SEC, it is simply the fact that the market knows the SEC gets it right in a great majority of cases and so reacts accordingly.

Since the US is the only country in the world, that I am aware of, that lets the stock of dead dark companies continue to trade in their public markets, I would argue they need more unilateral authority than they have currently.