Medallion Financial stock plunges toward 13-month low after SEC discloses fraud charges

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Shares of Medallion Financial Corporation MFIN,
-27.51%
The New York-based bank holding company and its chief operating officer Andrew Merstein were set to trigger all premarket decliners on Wednesday in premarket trading to a 13-month low, after the Securities and Exchange Commission accused the New York-based bank holding company and its chief operating officer Andrew Merstein of engaging in “fraudulent schemes.” declined by 56.5%. Increase its share price. The SEC’s complaint alleges that Medallion and Merstein “illegalized” of their stock by paying Cranium Inc. of media strategy company Ichabod to place positive stories about the company on various websites, including the Huffington Post, Seeking Alpha and TheStreet.com. engaged in “brokering”. Ichabod’s Cranium and its owner Lawrence Meyers were also charged by the SEC. “With Merstein’s knowledge, Meyers and others created fake identities so that their opinions sounded credible to potential investors,” the SEC said in a statement. “The complaint further alleges that Medallion and Merstein fraudulently increased the carrying value of Medallion Bank (the bank), a wholly owned subsidiary of Medallion, to compensate for losses related to the Taxicab Medallion loans.” Medallion stock, which was on track to open at its lowest price since November 2020, was up 72.5% this year, while the SPDR S&P Regional Banking ETF KRE,
+0.21%
36.8% and the S&P 500 SPX was up,
-0.05%
had increased by 27.4%.

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