Because they are not subject to extra requirements of the SOx Act they are only required to comply with the basic minimum SEC reporting standards which are subject to interpretation, especially regarding the issuance of 8-Ks.
Whew. Thank goodness for that. We don't want any overly strict regs to get in our way.
I have spoken by telephone twice with people at the SEC - today and once a couple of years ago. Both times they were very happy to answer specific questions about the regs but can't discuss a specific company unless an investigation has been made public.
I'm sure they were thrilled to be talking to you.
The impression I have gotten both times is that investors in penny stocks are somewhat on their own. There are so many scams that they can't possibly investigate even a fraction.
Gee, no kidding.
Whereas there are analysts and institutional investors keeping an eye on big board stocks to hold them somewhat accountable for guidance and other public statements and punish them in the market when they fail, no one but the individual shareholders themselves are doing so for penny stocks. Therefore, even though there is a VERY high scam rate, it's harder for them to rise to the level that triggers an investigation.
Yeah, I can always count on the stock analysts to look out for me.
One thing that does help the SEC get involved is a shareholder lawsuit in which plaintiff's attorneys uncover malfeasance in the course of discovery. If such malfeasance appears to include substantial violations of SEC laws, then the SEC is more likely to get involved (a lot of their work is already done). The SEC can take it so far as to prosecute violators and win disgorgement of ill-gotten gains, fines and even jail time.
Wow, that sounds great! Prosecute those violators!
However, it is rare that it ever gets to this level with penny stocks, but it does happen (eg: the eConnect scam).
D'oh!
In the case of e.Digital, even though they have tried to be careful to try to cover themselves by extensive use of misleading creative language with forward-looking language (FLL) disclaimers, I believe that there have been several times when it can be factually proven that that they intentionally lied to shareholders in public statements that were not protected by FLL.
I'll bet those FLLs just did a dandy job of CTA.
Sadly, I think they will get away with all of their years of false and misleading statements because shareholders are not yet united in agreement as to what has happened in the past (false and misleading statements) and what should be done in the future. There has been insufficient shareholder pressure on the BOD for accountability and upholding their fiduciary duties.
That is sad. What does fiduciary mean again?
A lot of people still hold out hope that they will either be able to recover their losses and/or make great gains in the future if problems are swept under the rug. The followers of the shill-driven agoracom board have been the most resistant to looking at the facts and demanding accountability. This is no surprise since the shill guru's on that board have the opposite motive.
Woo Hoo! I like when problems are swept under the rug because then no one sees them.
IMO, the shareholders who have finally smelled the coffee need to band together and not allow themselves to continue to be steam-rollered with dilutive financing after dilutive financing supported by fluff PRs and message board shills.
After drinking so much Kool-Aid, I'm really not up for smelling coffee.
If they are never going to have a viable business, they should just admit it.
What, and spoil the surprise?
News 
Market Data 
Discover 
