BaFin, Germany’s top financial services regulator has warned that buy recommendations on Southern Lithium Corp shares were suspicious and investors must be careful.
BaFin said the buy campaign on the shares of Southern Lithium Corp massively circulated online via newsletters targeting various sets of people.
In a statement issued shortly, BaFin said:
According to information available to the Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht – BaFin), buy recommendations are currently being issued for shares in Southern Lithium Corp. (ISIN: CA8433031082) on a large scale via e-mail newsletters.
BaFin has evidence indicating that these buy recommendations contain false or misleading information and/or that existing conflicts of interest are wrongfully concealed. It has initiated an investigation into suspected market manipulation in the share.
BaFin, therefore, recommends all investors to closely examine whether the information provided is reliable and to obtain information about the company in question from other sources prior to buying the shares.
For unsophisticated investors, this sort of campaign might be a pump and dump approach when early owners of the stock might quickly sell them once a significant number of people have bought from them.
