POUR DIFFUSION IMMÉDIATE
April 9, 2020
UPDATED: MAY 29, 2020
MSC Warns of Aggressive Stock Promotion Exploiting COVID Recession Fears
Winnipeg – The Manitoba Securities Commission (MSC) is issuing an investor alert warning the public to exercise extreme caution about aggressive promotion of Crestview Exploration Inc., a British Columbia gold mining company.
A mailing sent this week from a “stock analyst and geologist” to residents of Manitoba, Saskatchewan, B.C., and Alberta makes exaggerated claims about Crestview, predicting that its stock price “will soar as the recession hits.” The letter comes in an envelope, without a return address, that says in bold red letters, “CORONAVIRUS AFFECTING MARKETS: READ NOW.”
MSC has received several complaints about the letter in just a few days, which makes unsubstantiated and unrealistic claims concerning returns.
Crestview, listed on the Canadian Securities Exchange and the Frankfurt Stock Exchange, issued a statement April 8 stating that it was not responsible for the promotion, and said the letter contained “unfounded forward-looking statements.” The company urged investors and potential investors to verify any statements, and the source of such statements, contained in buy recommendations.
UPDATE MAY 29, 2020: A very similar letter headlined, “A RECESSION IS AROUND THE CORNER,” was sent to Canadian households last week. The letter refers to the “irreparable financial damage” caused by the lockdown, and then goes on to make the same recommendation of Crestview.
MSC strongly advises investors to exercise caution when considering aggressive promotions as a basis for investment decisions, as these promotions may make false claims of large profits and baseless stock price projections. Most aggressive stock promotions in recent years have been done through unsolicited email or social media, but promotions delivered through the mail carry the same risks.
“We’ve unfortunately seen a steep increase in marketing that exploits people’s anxiety about the pandemic and their investments,” says Jason Roy, Senior Investigator with the MSC. “Investors need to be extremely vigilant when making decisions in this environment.”
Anyone who is considering buying or selling an investment to do research or talk to their registered investment advisor to ensure it is an appropriate decision. For helpful, unbiased information on becoming a better informed investor, visit financesaviseesmanitoba.ca
La Commission des valeurs mobilières du Manitoba est une division de l’Office des services financiers du Manitoba, organisme de service spécial du gouvernement du Manitoba chargé de protéger les investisseurs et de favoriser l’équité et l’efficacité dans les marchés financiers de la province.
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