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Opko Health Under Fire From The SEC; Mark Cuban Confirms He's Short The Stock

Opko Health Under Fire From The SEC; Mark Cuban Confirms He's Short The Stock

Financier Barry Honig, Opko Health Inc. (NASDAQ: OPK) and Riot Blockchain, Inc. (NASDAQ: RIOT) CEO John O'Rourke were among those named as defendants in a securities fraud lawsuit filed Friday by the Securities and Exchange Commission that alleges a "pump-and-dump" scheme. 

Trading of Opko shares was halted indefinitely on Friday afternoon.

Cuban An Opko Short 

Billionaire investor and "Shark Tank" personality Mark Cuban confirmed to Benzinga Friday afternoon that he's short Opko Health and biotech PolarityTE Inc (NASDAQ: COOL).

Cuban tweeted March 6: “Just for the record, I shorted it several years ago,” in reference to Opko.

Cuban was recently questioned about his shorts on CNBC and refused to answer, and said: “If you want to know where my short interests traditionally have been, just check out that site, because we publish it all. Because you know I’m not best friends with the FCC, so literally anything that I have shorted has been published." 

The site Cuban was referring to was Share Sleuth; in July, the website published a piece on Honig and his associates. 

The Lawsuit 

Honig and nine others were involved in highly profitably “pump-and-dump” schemes perpetrated by numerous executives and entities, the SEC said. They are accused of recruiting others to buy or sell stock and then promoting the stock to increase the allure before securing prime ownership of the issuer and essentially serving as a control group to create market interest.

Misleading information was produced to inflate stock prices, according to the SEC. 

“In several instances, to magnify the intended boost to volume and price that would follow a promotional article's release, Honig, Brauser, O'Rourke, Groussman, Melechdavid and ATG engaged in pre-release manipulative trading to generate a misleading picture of market interest in the company's stock, priming investor interest," the complaint said. 

Three schemes took place from 2013 to 2018 and generated millions of dollars, according to the SEC. 

PolarityTE Terminates Stetson

Biotech PolarityTE announced in a press release Friday that it had terminated John Stetson, a defendant in the SEC lawsuit. Stetson is PolarityTE's former chief investment officer and executive vice president, according to his LinkedIn

"None of the other defendants listed in the complaint filed by the SEC has any recent management, employment, or consulting relationship with the company, nor will there be any such relationship in the future," the company said in a statement.  

"As evidenced by the actions taken today, the company, management, and board of directors do not tolerate the behavior outlined in the complaint."

What's Next 

Opko shares were down 18 percent at $4.58 at the close Friday, while Riot Blockchain shares were down 24.3 percent at $4.30.

The SEC lawsuit was filed in U.S. District Court in New York's southern district. 

Related Links:

Opko Seen In Poor Health; JPMorgan Downgrades

PolarityTE's Stock Falls 30% After Citron Calls It A Fraud


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Posted-In: Barry Honig Citron Research CNBCNews Short Sellers Legal SEC Media Best of Benzinga

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