Most corporate executives receive company stock and stock options as a large portion of their compensation. These executives are personally motivated to increase the company’s stock price. Some of them cause the company to make false statements or omissions in public filings with the SEC and financial statements, creating false optimism about the company’s current and prospective financial condition. This conduct can have a significant impact on share prices, and, when the stock eventually falls when the truth is revealed, cause significant losses to investors.
The securities laws forbid anyone from knowingly making any materially false statements or, in some cases, omissions in connection with the purchase or sale of a security. If you have evidence of companies making materially false statements in their financial reports and filings, you may have a whistleblower claim under the SEC Whistleblower Program, and should speak to a qualified attorney.