For deceiving investors by purporting to provide unbiased research reports on chain publicly traded small and microcap companies two Indian-origin brothers have been charged by the US federal regulator. The two Indian origins are known as Ajay Tandon, (41), and Amit Tandon (47) of Stock Research firm SeeThruEquity Co-founded by them were charged by the Securities and Exchange Commission with defrauding investors by issuing reports purportedly based on “unbiased” and not paid for the research.
The co-founder and CEO of SeeThruEquity Mr. Ajay have experience in the securities industry. In addition, the Director of Research at Seethru Mr. Amit is also charged under the same matter. According to the complaint, the Brother of SeeThru allegedly collected up to several thousand dollars in conference presentation fees per company, and the issues regularly had input into the substance of the supposedly unbiased research reports, even including the price targets at times.
It further alleges that the brothers also engaged in scalping, which is a form of securities fraud that occurs when a perpetrator makes a stock recommendation to investors and contemporaneously trades against that very recommendation in the open market without adequate disclosure.
The Director of the SEC’s Atlanta Regional Office Richard Best said “ There is a clear line between paid advertising and unbiased research coverage, and we allege that SeeThru and its co-founders crossed it to deceive investors and make money. According to our complaint, Ajay Tandon even scalped multiple issuers, further revealing the biased nature of SeeThru’s research reports”
As per the federal court, the complaint filed charges that Mr. Ajay and SeeThru with violating the antifraud provisions of the federal securities laws, and charges Mr. Ajay and Mr. Amit aiding and abetting certain violations by SeeThru.