50 Cent Using Twitter To Pump Up Stock... But Is It Legal?

from the seems-sketchy dept

Tue, Jan 11th 2011 8:29am — Mike Masnick

We're all familiar with stock market pump and dump scams that have been around forever, and often show up via spam, but what happens when someone famous gets in on the game. Apparently, rapper 50 Cent started pumping the stock symbol of a penny stock for a company that is distributing a new pair of headphones that he's associated with. The stock then surged, increasing the company's value by $50 million. Oddly, when I look at the Twitter account of 50 Cent, I no longer see the Twitter messages in question, which makes me wonder if he realized he might get in trouble for those tweets. Of course, there's nothing wrong with giving stock advice but if he didn't disclose his own association with the company, he could run into serious legal problems from both the SEC and the FTC, who have been looking to crack down on "sponsored" tweets that don't properly disclose a relationship.

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Filed Under: 50 cent, ftc, pump, sec, stocks

15 Comments

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average_joe (profile), 11 Jan 2011 @ 9:11am

But apparently he couldn't get the stock to hit 50 cents. :)

http://finance.yahoo.com/echarts?s=HNHI.OB+Interactive#chart3:symbol=hnhi.ob;range=5d;indicato r=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined
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- theangryintern (profile), 11 Jan 2011 @ 9:20am
  
  Re:
  http://instantrimshot.com/
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  - average_joe (profile), 11 Jan 2011 @ 9:54am
    
    Re: Re:
    That's awesome!
    
    This stock closed at 10 cents per share on Friday, and then it opened at 45 cents per share Monday morning.
    
    http://instantrimshot.com/index.php?sound=yeehaw
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John Doe, 11 Jan 2011 @ 9:54am

Why would anyone listen to 50 cent?
50 cent is over priced by about 48 cents.
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- Marcus Carab (profile), 11 Jan 2011 @ 10:18am
  
  Re: Why would anyone listen to 50 cent?
  Yeah, he's a pretty annoying musician. But it turns out he's a pretty good businessman (or knows how to surround himself with good businessmen) because he has turned his thug image into a highly successful enterprise.
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Frankz (profile), 11 Jan 2011 @ 10:05am

So, who got in at 10 cent and cashed out at 45?
50?
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ChimpBush McHitlerBurton, 11 Jan 2011 @ 11:17am

Pump and Clump
I'd be tempted to short this stock after the artificial rise, if I didn't know that my position would be completely illiquid.
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simon, 11 Jan 2011 @ 12:47pm

50 cents got his name for how much he would charge to bend over the wall, afaik he came out from the prison a rich man.

Whore!
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framitz (profile), 11 Jan 2011 @ 2:18pm

I'm no lawyer, but...
It sounds like a felony to me.
And he knows it, too late to take it back now.
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AutoTweet (profile), 16 Jan 2011 @ 11:58am

Pumping up a stock like that on twitter doesn't sound legal to me. It shows the power of celebrities as much as the power of twitter.
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suzena, 16 Jun 2011 @ 11:11pm

Stock Market Game
Students who participate in the The Stock Market Game program learn more than investing. As they progress, they learn core academic concepts and skills that can help them succeed in the classroom � and in life.

Starting with a virtual cash account of $100,000, students strive to create the best-performing portfolio using a live trading simulation. They work together in teams, practicing leadership, organization, negotiation, and cooperation as they compete for the top spot. The setup is engaging, and the learning is a natural part of the experience.
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Neil Johnson, 15 Sep 2011 @ 7:30am

Celebrity Greed
Unfortunately, the name of the game for celebrity is to get what you can now and don't worry about what else happens or to who.
It is also breeding a generation of people with the same attitude even though they are not celebrity, thus propogating the I want now generation.
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teenoie, 18 Jan 2012 @ 1:52am

Re: Why would anyone listen to 50 cent?
The Glentronics BWE The Basement Watchdog Emergency Sump Pump System is Pumps up to 33.3 GPM, or 16.7 GPM at a 10′ lift. Runs over 6 hours continuously on a single charge with the Basement Watchdog standby battery, model
No. 30HDC140S (not included). Monitoring system alerts you when battery is discharged or defective, terminals are corroded, pump has been activated, AC power is out, or charger is unplugged. Exclusive fluid sensor alerts you when the battery needs water. Float switch is compact, dependable, and will not get in the way of the main pump.
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Sincere, 21 Feb 2012 @ 7:20am

why would any not listen to 50Cent
Why would you not listen to 50 cent AKA ferari 50 he is one of the world's greatest businessmen and bas proven that time and tuna again with his financial decisions and their outcome
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Sincere, 21 Feb 2012 @ 7:20am

why would any not listen to 50Cent
Why would you not listen to 50 cent AKA ferari 50 he is one of the world's greatest businessmen and bas proven that time and tuna again with his financial decisions and their outcome
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