SEC Charges Individual with Fraudulent Scheme Involving the Dark Web

The SEC charged an individual with selling fake insider stock tips on the dark web.

In a Complaint filed in the U.S. District Court for the Southern District of Indiana, Indianapolis Division, the SEC alleged that the individual falsely advertised the tips as the product of material non-public information obtained from an insider trading forum ("ITF") or from corporate insiders. The SEC alleged that the individual sold the fake stock tips to investors, who in turn placed trades in publicly traded stock based on the tips.

The SEC charged the individual with violations of SEA Section 10(b) ("Manipulative and deceptive devices") and SEA Rule 10b-5(b) ("Insider Trading"). The individual agreed to a bifurcated settlement subject to court approval which includes permanent injunctive relief and disgorgement and civil penalties to be determined by the court at a later date.

The U.S. Attorney's Office for the Middle District of Florida also filed charges against the individual in a parallel case.