I was planning on posting my consumer reviews of the e-cig today, but instead I was forced to sell most of my shares when the CEO of SFIO was charged with fraud.
This obviously changes everything, because the product means nothing if the company can’t be trusted. The only hope for shareholders would be if the CEO and his cohorts are replaced with a new management team, however the likely scenario is that the SEC will be shutting down the stock.
The penny stock market is obviously a risky one, but I doubt that any of the long term shareholders were prepared for this news. Overall, I am pretty sickened by this news and don’t want to write anything else right now- except that shareholders should sell what they can while they can.
Update (2:11 AM)- I just read the document that details the charges against the CEO and his cohort, and I am shocked that the SEC waited 2 years to charge the CEO with 20K in fraudulent activities (while meanwhile million dollar pumps {LEXG/JAMN/POTG/etc.} fly free as a bird).
Basically, the FBI had an undercover agent posting as a broker, and they offered to purchase restricted shares for a 30% kickback. Even though the FBI shipped 20K directly to SFIO while they were setting them up, it still took them 2 years to actually press the charges. I fully agree with the charges against the defendants, and I think Tom and his cohort should be locked away for years. However, I think their sentences should have started about a year and a half ago after the investigation concluded with 20K being shipped to them. Most of the current shareholders would not have even heard of SFIO if the SEC concluded their investigations in a timely manner.
In review, the defendants have been proven guilty and they deserve to pay the price. However, the SEC does not deserve a pat on the back for waiting 2 years to actually file a legal claim against the defendants. How can they sit back for 2 years and let the company grow in value (and grow in market exposure) without even hinting at any legal issues???
This whole scenario has me thinking long and hard about how manipulated this market really is (billion dollar hedge fund stock schemes that run without a hitch/Market Makers basically deciding the price of a stock on their own/etc.), and from now on I plan on daytrading with the preconceived notion that I need to liquidate positions quickly (since the market is just like college football in regards to overall corruption, and SFIO is simply the market version of Ohio State in regards to being an example in order to make the average investor feel like the markets are safe and well monitored).
I hope that the CEO understands how many people he has hurt with his actions, and I hope that the SEC finds a way to streamline their process of charging defendants that are obviously guilty. Both parties deserve some blame here, but at the end of the day I hope everyone learned something from this unfortunate development.
