In 2013, Fox News contributor, Tobin Smith, was fired after receiving compensation for promoting the stock of Petrosonic Energy on air. The move was a violation of the news network’s policies. At the time, Smith’s company NBT Equities Research was also receiving compensation for promoting other companies through his site and conservative newsletters.
In March of 2016, Tobin Smith settled penny stock fraud charges with the Securities and Exchange Commission. At the time, the SEC alleged that Smith and his company, NBT Group Inc., had fraudulently promoted a penny stock to investors. SEC claimed that Smith and his company were paid to construct and distribute emails, blogs, articles and other communications to advertise the stock of IceWEB Inc.
Smith and the company were accused of failing to disclose their compensation to investors. The SEC also alleged that the promotional material had contained misleading and false statements in an attempt to artificially increase the trading volume and price of IceWEB’s stock. As part of the settlement, Smith and NBT agreed to be barred from future involvement in any future penny stock offerings.
They were also ordered to paid disgorgement of $165,900 and $16,893. Smith was forced to pay a $75,000 penalty. Today, August 11, 2017, a federal court issued an order holding Tobin Smith in contempt for failing to pay monetary sanctions and partaking in another penny stock offering, despite being barred.
In the SEC’s contempt filing, it is alleged that Smith and NBT Group have violated the court’s previous judgment by promoting another penny stock offering based on misleading information. Again, Smith is accused of taking compensation for promoting the stock. The court order was issued on August the 8th. It requires Smith and NBT Group to account for and repay the money received in relation to the penny stock offering.
Smith is also required to pay all delinquent disgorgement and interest. Should Smith and NBT Group fail to comply with the order within 10 days, they’ll be hit with a $1,000 fine each day and a warrant will be issued for Smith’s arrest. Yolanda Ochoa and Finola H. Manvelian were in charge of the SEC’s investigation into the matter.