Section 17(b) of the Securities Act of 1933 makes it unlawful for any person to tout stocks for consideration without fully disclosing the consideration. Regardless, many stock promoters fail to disclose such material information in order to dupe investors into buying their hot penny stock of the week.
Proper disclosure is a very important part of a stock promoters repertoire and the one used by otcstockexchange.com has evolved quite well over the years. In the past, otcstockexchange.com used to tout penny stocks without any compensation disclosure whatsoever. Although they had been compensated 100,000 free trading shares to promote FCCN back in 2006 they failed to properly disclose this material fact (see legal disclaimer #1).
After a while, they decided it would be a good business practice to at least disclose compensation “from a 3rd party”. While this “3rd party” trick still isn’t full disclosure… it was a step in the right direction (see legal disclaimer #2).
Recently, otcstockexchange.com began writing a novel of a legal disclaimer at the bottom of each email newsletter. In fact, their legal disclaimer is usually longer than their promotion. But at least now they’re following the law, which is pretty rare among penny stock promoters today (see legal disclaimer #3).
LEGAL DISCLAIMER #1
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12/12/06
info@otcstockexchange.com
Franchise Capital Corporation [FCCN] today announced that it has reached an agreement with Aero Exhaust, Inc., a leader in performance exhaust airflow technology, under which Franchise Capital Corporation would acquire all of Aero Exhaust’s issued and outstanding shares. Aero Exhaust mufflers are an exclusive National Association for Stock Car Auto Racing (NASCAR) Performance product and carry the prestigious NASCAR brand on product, packaging and related media. NASCAR legend Rusty Wallace is the official spokesperson for Aero Exhaust products.
*Never invest into a stock we discuss unless you can afford to lose your entire investment. For our full disclaimer go to: http://www.otcstockexchange.com/disclaimer.htm
LEGAL DISCLAIMER #2
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01/09/09
info@otcstockexchange.com
*Never invest into a stock we discuss unless you can afford to lose your entire investment. Keep in mind that these low price companies could make huge swings in either direction and should only be attempted by savvy individuals with risk capital looking for huge returns. Affiliates of the publisher for OTCStockExchange.com have received a fee of 500,000 shares of OpenCell Biomed, Inc. (OCBM) from a third party for this investment opinion feature. Affiliates of the publisher for OTCStockExchange.com intends on selling these shares. For our full disclaimer go to: http://www.otcstockexchange.com/disclaimer.htm
LEGAL DISCLAIMER #3
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04/27/09
info@otcstockexchange.com
Important Disclaimer:
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Buying and Selling of Shares:
OTCS intends to sell its shares in the event the shares rise in value. OTCS may sell its shares for less than target prices given in opinions. OTCS’s affiliates, officers, directors and employees may have also bought or may buy the shares discussed in this report and may profit in the event those shares rise in value. OTCS will not advise as to when it decides to sell and does not and will not offer any opinion as to when others should sell; each investor must make that decision based on his or her judgment of the market. If you have any questions you can email us at info@OTCStockexchange.com.
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Information presented on the OTCS website contains “forward looking statements” within the meaning of Section 27A of the Securities Exchange Act of 1933 and Section 21B of the Securities Exchange Act of 1934. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, goals, assumptions or future events or performance are not statements of historical fact may be “forward looking statements”. Forward looking statements are based on expectations, estimates, and projections at the time the statements are made that involve a number of risks an uncertainties which could cause actual results or events to differ materially from those presently anticipated. Forward looking statements in this action may be identified through use of words such as “projects”, “foresee”, “expects”, “will”, “anticipates”, “estimates”, “believes”, “understands”, or that by statements indicating certain actions “may”, “could”, or “might” occur. Understand there is no guarantee past performance will be indicative of future results.