Remember all those insider buys Phillip Frost was making in OPKO Health? I liked OPKO Health and added it to the healthcare portfolio here. I ultimately made a little money on the trade and have kept it on the long term buy and hold portfolio. I’m now recommending a sell and I’m removing it from the portfolio after the SEC filed a complaint against Frost for stock manipulation. We are down -11% from my entry at the end of July 2018.
I can’t believe it. Phillip Frost was like a pillar of the community. I have a bad habit of trusting and respecting elders more than I probably should.
I’m crushed by this alleged betrayal of the public’s trust.
But it gets worse. The Seeking Alpha platform was used in the scheme to defraud investors.
The SEC complaint says that Frost participated in three stock manipulation schemes led by Barry Honig. The pump and dump scheme involved three tiny, low liquidity public companies, not named in the complaint. They paid people to write favorable and misleading articles on the Seeking Alpha website. Honig then allegedly arranged manipulative trades to get the stocks to a level where they could dump them on the public, according to the SEC complaint.
The beacons of editorial intelligence over at Seeking Alpha were busy denying articles from me for silly reasons IMO, but approved articles from these pump and dumpers. Brilliant editorial minds over at Seeking Alpha. My new tagline for Seeking Alpha is “You may be broke, but at least you’re well read!”
This is the kind of stuff that gives Wall Street a bad name and don’t think for a second that more pump and dumps like this aren’t happening over Seeking Alpha and other websites.
I’m starting to think a better posture in this current market environment is permanent suspicion like an old Clint Eastwood Spaghetti Western:
You can read the full story on Barron’s here.