A lot of hoopla and strong language over Cresos alleged social media marketing techniques, what do we all think of it? Seems like a lot of bears have suddenly come out of the woods for this (many accounts I haven't seen post on here) and all the other threads have been derailed. Those of you who think it is bad (if true), can you say why it is so bad instead of "management is incompetent", those of you who think it's nothing to worry about can you say why you think so? Personally doesn't seem like a huge deal to me, the articles seem to point the finger more at Assad than Creso (if the allegations are true) for not disclosing his relationship correctly and lightly questions the ethics of promoting stocks on social media.
Key points:
-"$100 million company [Creso] found itself in dispute with a key adviser [Assad Tannous] about whether it had issued 1 million shares for "marketing and promotional services to potential investors"."
-"When contacted by AFR Weekend, Mr Tannous denied he was paid to promote any companies in his Twitter feed, saying the Creso share issue was for advisory work. He said the description of his role must have been a "mistake"."
-"only a handful of people knew that exuberant social media influencer and trader Tannous was paid more than $1 million in scrip by Creso in exchange for "marketing and promotional services"."
-"Tannous, who hung up after his original comments and then rang back minutes later, says the share deal was struck before the group was listed and was payment for advisory work, including giving business advice before and after site visits to Switzerland and other countries, feedback on packaging and sharemarket insights."
-"A spokesman for the Australian Securities and Investments Commission says the regulator is aware of social media promotion, and monitors it."
-"In particular, the regulator is thought to focus on any risk of misrepresentation as a financial licence holder, or front-running where a promoter creates demand for a market and then sells into it.
There is no suggestion that Tannous is doing that."
-"There is nothing illegal about receiving payment to promote a stock or in exchange for other services. In fact, it's common practice by cash-poor start-ups."
