3 ms·

> Whether this is fraud or not basically hinges on whether you were being intentionally dishonest, right? No. Do you mean legally? or morally? Legally the of

> Whether this is fraud or not basically hinges on whether you were being intentionally dishonest, right? No. Do you mean legally? or morally? Legally the offenses include things beyond what might strictly be "fraud" (see "fraud or deceit" as one example, but there are more [1]). IANAL, but failing to mention that your posts are with the hope of raising the price because you have a vested interest in that... seems like a material omission, if nothing else. Morally (and I'd expect legally based on the text, but IANAL) what matters is what he expected to happen as a result of his posts on the message board. If he knew people would likely buy the stock in response to his posts, and he intended to take advantage of that influence to make money off those sales, that's the end of the story. Whether he sincerely believed the stock would actually rise regardless is beside the point. > But now how do you distinguish between malice and stupidity? I'll assume you mean good faith because stupidity isn't in the picture here. Someone who's genuinely predicting the stock market correctly isn't stupid. Do you sincerely believe this person didn't expect his messages to raise the stock price, or that he didn't intend to take advantage of such a rise to make money off the stock sales? I sure don't. [1] https://www.law.cornell.edu/uscode/text/15/77q https://www.law.cornell.edu/uscode/text/15/77q

AnthonyMouse 3y ago
> failing to mention that your posts are with the hope of raising the price because you have a vested interest in that... seems like a material omission, if nothing else. And if you run around telling people that you just bought some of the stock you think is going to the moon, is that supposed to make them less inclined to buy it, or do they now just think you're putting your money where your mouth is? > what matters is what he expected to happen as a result of his posts on the message board. Which is the problem. How do you prove what's inside of someone's head? Especially if they are malicious and know what not to say out loud. > Someone who's genuinely predicting the stock market correctly isn't stupid. If you think the stock is going up 1000% and it only goes up 300%, you were wrong, and your pick was wrong, and the people waiting for it to go up 1000% before selling are the people who lost money when it went back down. But as far as I know, being initially wrong and then changing your mind before you lose your money isn't illegal.
- dataflow 3y ago
  I don't have the energy to dissect all this, but you're completely conflating legality, enforcement, and provability. We have juries for a reason. Most would a priori find it hard to believe that someone who found a winning strategy would repeatedly post it on random message boards with altruistic intent.
  - AnthonyMouse 3y ago
    Juries need some basis on which to make a decision. The law is ridiculous if it only turns on whether you had a lawyer ahead of time to tell you what not to say while operating the identical scam. It's not clear why telling people you think a stock is going to go up after you've already bought it would require altruism, and more than that you would benefit by building a reputation as someone who makes accurate predictions if you turn out to be right, independent of whether anyone acts on your statement by buying the stock.
    - hnfong 3y ago
      > The law is ridiculous if it only turns on whether you had a lawyer ahead of time to tell you what not to say while operating the identical scam. You'd be very shocked... ... but that's essentially what criminal defence is about :-/ In a sense half the value of having a defence lawyer is having somebody to remind you not to say stupid things to the police/investigators/prosecution. Of course it's not really as simple as that, but you'd be surprised at the number of convictions where the prosecution relied on something stupid the defendant said. If (say) 50% of convictions "turns on whether you had a lawyer ahead of time to tell you what not to say", is the law ridiculous? Because that's what it generally is like (not just for securities fraud cases). PS: for cases where it's particularly easy to feign ignorance/innocence, sometimes the law specifically states that the mens rea requirement is waived (i.e. the intent/knowledge does not matter, or does not need to be proved beyond reasonable doubt). This in turn gives opportunity for defence lawyers to argue this infringes on the right of the defendant to be presumed innocent..
      - 3y ago
j33zusjuice 3y ago
I think you misunderstood. The guy bought the stock, posted on some forum that he got the stock and it was going to the moon, and then he saw a 300% increase in whatever period they said. At the time they posted, they believed there would be a 1000% increase in price. But now they’re seeing 300%, and thinking they should get out now instead of trying to chase the high point, 300% is still a good profit.

AnthonyMouse 3y ago

> failing to mention that your posts are with the hope of raising the price because you have a vested interest in that... seems like a material omission, if nothing else. And if you run around telling people that you just bought some of the stock you think is going to the moon, is that supposed to make them less inclined to buy it, or do they now just think you're putting your money where your mouth is? > what matters is what he expected to happen as a result of his posts on the message board. Which is the problem. How do you prove what's inside of someone's head? Especially if they are malicious and know what not to say out loud. > Someone who's genuinely predicting the stock market correctly isn't stupid. If you think the stock is going up 1000% and it only goes up 300%, you were wrong, and your pick was wrong, and the people waiting for it to go up 1000% before selling are the people who lost money when it went back down. But as far as I know, being initially wrong and then changing your mind before you lose your money isn't illegal.

dataflow 3y ago
I don't have the energy to dissect all this, but you're completely conflating legality, enforcement, and provability. We have juries for a reason. Most would a priori find it hard to believe that someone who found a winning strategy would repeatedly post it on random message boards with altruistic intent.
- AnthonyMouse 3y ago
  Juries need some basis on which to make a decision. The law is ridiculous if it only turns on whether you had a lawyer ahead of time to tell you what not to say while operating the identical scam. It's not clear why telling people you think a stock is going to go up after you've already bought it would require altruism, and more than that you would benefit by building a reputation as someone who makes accurate predictions if you turn out to be right, independent of whether anyone acts on your statement by buying the stock.
  - hnfong 3y ago
    > The law is ridiculous if it only turns on whether you had a lawyer ahead of time to tell you what not to say while operating the identical scam. You'd be very shocked... ... but that's essentially what criminal defence is about :-/ In a sense half the value of having a defence lawyer is having somebody to remind you not to say stupid things to the police/investigators/prosecution. Of course it's not really as simple as that, but you'd be surprised at the number of convictions where the prosecution relied on something stupid the defendant said. If (say) 50% of convictions "turns on whether you had a lawyer ahead of time to tell you what not to say", is the law ridiculous? Because that's what it generally is like (not just for securities fraud cases). PS: for cases where it's particularly easy to feign ignorance/innocence, sometimes the law specifically states that the mens rea requirement is waived (i.e. the intent/knowledge does not matter, or does not need to be proved beyond reasonable doubt). This in turn gives opportunity for defence lawyers to argue this infringes on the right of the defendant to be presumed innocent..
    - 3y ago

j33zusjuice 3y ago

I think you misunderstood. The guy bought the stock, posted on some forum that he got the stock and it was going to the moon, and then he saw a 300% increase in whatever period they said. At the time they posted, they believed there would be a 1000% increase in price. But now they’re seeing 300%, and thinking they should get out now instead of trying to chase the high point, 300% is still a good profit.