Quote:
Originally Posted by chassis
I still don't see who is harmed by the status quo. The Federal government? State government? The consumer? An investor? Is a Federal, state or local statute being violated? The link in the OP does not give the basis for an objection from the SEC.
The only question I see here is whether or not the status quo affects share price, and therefore potentially harming an investor. But an institutional investor will understand how the business fundamentals work, including punching, and I argue that the institutional investor would not be affected by the status quo.
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IANAL but punching muddies the picture of real sales, revenues, and other performance metric of the publicly listed company. This is creative accounting and confusing the material facts about the business. This is obviously against the purpose of securities law for publicly traded comparies, and pretty clearly against the wording of the law as well (registering fake sales to inflate sales pictures that are presented to investors). The fact that everybody does it, or that it has been going on for a long time does not change the material offense.