So 50 Cent's stock portfolio increases by millions of dollars because he Tweeted about one company? Isn't he rich enough? --MiChel, via in the inbox
You go ahead and say that to his face. I will wait for you--waaaaaaaay over here. Several blocks away.
Meantime, Fiddy--who did, at least briefly, increase the value of his stock by Tweeting about it--may be facing bigger problems than your disdain...
...and that's the possibility of a probe by the Feds.
Here's what Fiddy did:
He posted a Tweet to his 3.8 million followers, encouraging them to buy shares of an obscure company called H &H Imports. What Fiddy didn't say right away was that he owns a healthy chunk of the company. People followed his "tip" and the stock leaped from 10 cents to 40 cents in a single day. That's a hike of something close to 300 percent.
The stock has since deflated, and it trades every day, so it's tough to know whether, at this very moment, Fiddy is still as rich as he was, say, a week ago. It's also unclear whether Fiddy "dumped" any of that H &H stock when it was at its highest.
Regardless, according to longtime white-collar legal eagles, what Fiddy did may come very close to violating the law. The Securities Exchange Commission--the folks who regulate stock trading and whatnot--do not take kindly to any kind of "market manipulation."
And according to one lawyer who would know, that could be what Fiddy did by posting that Tweet.
"You've got to show that Fiddy intended to manipulate the market," one lawyer told me. "It's difficult to prove intent, and it becomes harder (but not impossible) if Fiddy never sells any of the shares."
More likely, the SEC might simply look into the case to see what Fiddy may have done. (Such agencies generally don't publicly confirm or deny such investigations until they're over and charges are filed. In fact, when I called the SEC, they declined to comment.)
"This [situation] has certainly attracted the SEC's attention," my lawyer expert guesses. "They've taken their lumps over the past few years because of the Bernie Madoff investigation and the financial crisis. The SEC staff would be eager to conduct a high profile investigation like this."
(Fiddy also is not alone, by the way. In fact, after a fashion, he's-- tee hee! --in bed with Carmen Electra.)
In the event that Fiddy did run afoul of regulations, the lawyer says, he'd most likely be forced to give up any profits he'd made (if he had, indeed, cashed out any stock). If the rapper was also found to have impeded the investigation, that could mean jail time.
But we're getting way ahead of ourselves with suppositions like that. In the meantime, everybody just buy whatever stock Fiddy says. I'm sure nothing bad could possibly happen.