SEC tells investors be wary of terrorism-linked claims; suspends trading in 2DoTrade
Tuesday, November 6th 2001, 12:00 am
By: News On 6
WASHINGTON (AP) _ The Securities and Exchange Commission warned investors Tuesday to be wary of claims of valuable products useful in fighting terrorism, as it suspended trading in stock of a company claiming it is testing a disinfectant for anthrax.
The SEC said it was temporarily halting trading in 2DoTrade Inc.'s stock because of questions about the accuracy of the company's claims, the status of its business operations and prospects, and the identity and backgrounds of people running the company.
The trading halt beginning Tuesday morning is a standard 10-day suspension, and will continue through 11:59 p.m. EST on Nov. 19. At that time the stock, unless it is subject to a further suspension, can resume trading.
The company's shares are traded on the National Association of Securities Dealers' OTC Bulletin Board, an electronic market system for small stocks that are thinly traded. Shares, which have a 52-week high of $1.55, closed at 47 cents Monday.
The company, registered in Nevada, says it has offices in London and in White Rock, British Columbia. Its most recent corporate filing with the SEC describes the company as being in the retail and restaurant business.
A telephone number for the company was disconnected. Charles Bingham, a spokesman for the company with an outside public relations firm, had no immediate comment.
The SEC said 2DoTrade has issued press releases claiming it is testing and preparing to market a disinfectant for anthrax.
In some places where anthrax spores have been found recently, such as in U.S. Capitol office buildings, workers have been spraying powerful chemical foams on the floors, walls and furniture.
Investors should be skeptical of claims by companies or promoters that they have a potentially moneymaking product or service that will aid the war against terrorism, and should seek independent verification of such claims, the SEC said.
``Investment scams that attempt to prey on fears of terrorism are abhorrent,'' SEC enforcement director Stephen Cutler said in a statement. ``We will be vigilant about rooting out and prosecuting those who seek to exploit recent events to defraud investors.''
Securities regulators also have warned investors to be wary of financial scams playing on people's fears and uncertainties arising from the Sept. 11 terrorist attacks.