Tobin Smith, a former market analyst and TV financial news commentator for Fox News, has agreed to settle charges that he and his company fraudulently promoted a penny stock to investors, the Securities and Exchange Commission announced Tuesday.
Tobin and his company, NBT Group Inc., were paid to tout IceWEB Inc., a data storage company, which they did through emails, blogs and articles without revealing to investors that they had a financial interest in the firm. Smith and NBT claimed IceWEB was a ‘perfect tech stock’ in order to manipulate the market and enrich themselves with illicit stock promoter fees, says Michele Wein Layne, director of the SEC’s Los Angeles Regional Office.
Smith and NBT agreed to promote IceWEB for a payment of $330,000 plus IceWEB stock. NBT could have earned incentive fees of more than $250,000 if the marketing campaigns succeeded in increasing the share price.
Smith was a Fox News contributor from 2000 until June 2013, including appearing on the “Bulls and Bears” television show on Fox News Channel. On the NBT website, Smith described himself as a contributor and market analyst for Fox News and Fox Business Network. Fox fired him in June 2013 for the conflict of interest.
In the SEC settlement, Smith and NBT agreed to be barred from involvement in any future penny stock offerings and to pay more than $182,000 in disgorgement and interest. Smith, who is from North Bethesda, Md., also must pay a $75,000 penalty. He and NBT did not admit or deny the charges.