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SEC charges firm, authors over paid touting

2017-04-10 20:41 ET - Street Wire

See Street Wire (C-*SEC) U S Securities and Exchange Commission

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by Mike Caswell

The U.S. Securities and Exchange Commission has filed civil charges against a paid-promotion company in New York called CSIR Group LLC. The SEC claims that CSIR arranged to have bullish articles placed on websites such as Seeking Alpha while falsely stating that the authors received no payment. The nine stocks that the SEC identifies as being the subjects of the articles include one with an office in Toronto and another that had roots in Vancouver.

The allegations are contained in a civil complaint that the SEC filed on Monday, April 10, in the Southern District of New York. The case targets CSIR and its owner, Christine Petraglia, 49, of New York. According to the SEC, Ms. Petraglia arranged to have articles published on public companies that deceived investors into believing that impartial writers had prepared the material. Her actions violated rules that require those writing about a company to disclose any compensation, the SEC says.

The companies that paid for the articles, as listed by the SEC, include Anavex Life Sciences Corp. The company has its office in New York, but prior to the events at issue it had Vancouver connections. In 2011 it appointed Vancouver resident Robert Chisholm as a director and on June 26, 2012, appointed him as its interim president. He replaced Kelowna resident Harvey Lalach, who had served the company in various roles since Feb. 1, 2007. The men are not defendants in the case, and are not accused of any wrongdoing. Both resigned before the conduct that the SEC complains of. Also identified in the complaint is Greenestone Healthcare Corp., a Toronto company listed on the OTCQB that claims to provide mental health services. The company is not a defendant.

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