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This Day In Market History: SEC Settles Charges Against 15-Year-Old Stock Manipulator

This Day In Market History: SEC Settles Charges Against 15-Year-Old Stock Manipulator

Each day, Benzinga takes a look back at a notable market-related moment that occurred on this date.

What Happened

On this day 19 years ago, 15-year-old Jonathan Lebled settled civil charges from the Securities and Exchange Commission by paying a $285,000 fine.

Where The Market Was

The Dow Jones Industrial Average closed at 10,687.92 and the S&P 500 traded at 1,451.34.

What Else Was Going On In The World

In 2000, the dot-com bubble burst, sending the Nasdaq plummeting and ruining thousands of internet-based companies. Faulty tires produced by Bridgestone/Firestone are blamed for nearly 100 fatalities related to Ford Motor Company (NYSE: F) Explorer crashes. The average cost of a new house was $134,150.

SEC Charges Minor

Lebed holds the dubious distinction of being the first minor ever charged by the SEC.

The SEC alleged that, starting at age 14 in 1999, Lebed ran a pump-and-dump scheme from the computer in his bedroom. Lebed was accused of buying penny stocks and then posting in internet chat rooms and online message boards encouraging other traders to buy his stocks. This type of behavior is classified as market manipulation, and Lebed earned as much as $74,000 in a single day running his operation.

While Lebed never admitted to wrongdoing, he settled with the SEC in September 2000 by forfeiting $285,000 in profits he earned on 11 specific trades plus interest. Lebed was allowed to keep roughly $500,000 in profits he earned on other trades.

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