UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 16682/ September 6, 2000
SECURITIES AND EXCHANGE COMMISSION v. GURSEL MANDACI, Civil Action No. 00-CIV-6635 (S.D.N.Y.)
The Securities and Exchange Commission ("Commission") announced that on September 5, 2000, it filed a complaint against Gursel Mandaci ("Mandaci") 25, of Brooklyn, New York, for using postings on the Internet to inflate the price of securities he had purchased in order to create short-term trading profits. Mandaci purchased thinly-traded penny stocks using a margin account he holds at an online broker. Then, using three different identities on the Internet, Mandaci made large numbers of postings that touted the issuers. Mandaci's use of different identities was designed to create the false impression that there was widespread interest in the stocks he owned. In addition, the postings contained false information about the issuers and baseless price predictions. Mandaci made more than $23,000 in six stocks he manipulated, including one stock that increased in price from $0.01 to $0.38. Mandaci's touting increased the market capitalization of the stocks he touted by a total of $92,772,845.81. This action is part of the fourth nationwide Internet fraud sweep conducted by the Commission since October 1998.
The Commission's complaint charges that Mandaci's scheme violated Section 17(a) of the Securities Act, Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. The Commission is seeking a permanent injunction against future violations, disgorgement with prejudgment interest, and civil penalties.
For tips on how to avoid Internet "pump-and-dump" stock manipulation schemes, visit http://www.sec.gov/investor/online/pump.htm . For more information about Internet fraud, visit http://www.sec.gov/divisions/enforce/internetenforce.htm . To report suspicious activity involving possible Internet fraud, visit http://www.sec.gov/complaint.shtml. For a description of other SEC enforcement actions involved in this Internet Market Manipulation Sweep, visit http://www.sec.gov/news/extra/intmm.htm.