many years ago i was in a stock that over the course of 4 months had a run from .11 to 5.06. though there was consistent volume, and obvious buying pressure on the stock, it was a slow grinder that washed most of its shares at each top it made. every week a few shares would go off on the bid, and then the ask would get pounded, and upward it crept. i kept track of the trading through the logs and charts and marvelled at the idea that a stock with an O/S of less than 50M could SELL so many shares when according to the TA the float and outstanding changed so little. i talked to the company, i was beta testing their product, and they told me it was just the way of the otc with lots of phantom trades. then i had a conversation with one of their financiers, and because i'm a believer in death by financing -- convertible debenture and discounted shares are the bane of all holders -- i called him out on the dilution, and asked him about the possibility of an SEC investigation.
he roared with laughter and said, "as long as it never has enough blow-out volume and cash flow to put it under the watchful eye of the SEC, this can go on for quite awhile. just enjoy the ride."
yup! all the way back to sub penny -- this was in the days before the fourth digit was de rigueur in walking a stock up or down. he even let me work out the details in figuring out just how many shares they were washing through the system, and he had no qualms about it being reported to the SEC, as was done by two of my friends; he was already lawyered up.
it was a little more than a year later that the stock was finally halted, but not by the SEC. it was the FBI, who indicted twenty-four people, including the CEO, IR guy, comptroller, etc, as part of a mob operation to launder money through four stocks. while there was quite a few who made outrageous coin from that play, much more than that was lost by the investor/speculators who believed in the story and went long.
this is quite the game, isn't it.