Rumors of Fraud Rock OCZ’s Stock on the NASDAQ
4/20/2011 by: Anshel Sag
Today marked the day when an article published by a company known as Copperfield Research caused OCZ’s stock to drop by 30% in a matter of minutes. The article only gained traction once it was posted on the popular investment website Seeking Alpha. It makes 15 allegations pertaining to the company’s statements, financial transactions, and company practices including those of the CEO. They also stated in their disclaimer that they, “As of the publication date, the author of this report has a short position in the company covered herein and stands to realize gains in the event that the price of the stock declines. The author does not use options to establish positions prior to a report’s publication.” At the given moment, we are a bit hesitant to take all of their strong allegations at face value considering their own profitable position. These are some very strong allegations and it would be a real shame to see an up and coming company is found out as a fraud. Copperfield Research has stated that they have forwarded their findings to the SEC, so we shall see how the company is affected.
The NASDAQ states that shares of OCZ were up more than 8% in early trading before news of the story appeared on Seeking Alpha. The stock was down as much as 37% at $6.50 around 12:08 EST today, but has rebounded significantly back to $8.06 at the time of writing. Current volume is at 23 Million nearly at 50% of all outstanding shares. This represents trading of 25 times more than the average trading of 908,000 shares a day.
We have contacted OCZ and they currently do not have an official response, but we expect one from them soon. We will keep you updated on the situations and any developments as the day progresses.
OCZ, Copperfield Research, NASDAQ, Seeking Alpha, Fraud, CEO, SEC
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