Forcerank Pays Fine, Axes Fees, Prizes After SEC Deems Contests ‘Swaps’
The SEC deemed Forcerank's model constituted an unregulated security-based swaps market.
Forcerank launched in March (IMD, March 3) as a mobile app to provide predictive stock recommendations based on how investors and professional traders rank lists of stocks against one another. The vendor incentivized individual participants with cash prizes for the best performers, and used the results to create a dataset of predictive data for institutions and hedge funds about how the market views potential stock movements.
However, the SEC deemed the agreements with players to be “security
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