The small-cap equity market, which operates across listed and OTC venues, plays a vital role in the U.S. capital markets and economy. Companies gain access to capital and investors are able to take a stake in venture stage firms. Even though small-cap equities trade both over-the-counter and on the national exchanges, there is a perception that an exchange listing provides an air of legitimacy on a company. However, the truth is that investors and market professionals benefit from added due diligence when assessing and trading all small-cap stocks.
Late last year, OTC Markets Group published a new Stock Promotion policy, along with Best Practices for public companies. These policies outline OTC Markets efforts to establish best standard practices, improve market transparency and better address the problem of fraudulent stock promotion. Continue reading “New Promotion Risk Flag Among the Latest Data Points to Increase Transparency and Investor Protection”
During conversations with compliance and risk departments over the past year, the topic of shell companies always comes up. For diligent compliance officers the reason for this focus is obvious, shell companies and more specifically trading with their affiliates are noted specifically in key notices and regulations, including: Continue reading “Shell Game”
The OTC equity market can seem overwhelming – with so many securities and data points to track, many compliance professionals are at loss for where to start. The good news is you are not alone.