IceWEB Investor Update: Former TV Commentator Tobin Smith Charged with Stock Fraud by SEC

The U.S. Securities and Exchange Commission (SEC) settled charges with Tobin Smith and his former company, NBT Group. The former market analyst and TV news commentator agreed to settle charges that he and his company fraudulently promoted a penny stock to investors. The SEC alleged that Smith and NBT were paid to prepare and disseminate emails, online blogs, articles and other communications touting the stock of IceWEB, a data storage company. Smith and NBT did not fully disclose their compensation to investors, who did not find out the increase in IceWEB’s share price. The SEC also claimed that promotional materials contained false and misleading statements intended to artificially increase the trading volume and share price of IceWEB’s stock.

According to the SEC, Smith entered into two separate agreements on NBT’s behalf to promote IceWEB and its stock in exchange for $330,000 in cash and IceWEB stock. The company could earn incentive fees of more than $250,000 if the marketing campaigns succeeded in increasing share price. Smith and NBT only disclosed some of their compensation and never informed investors that they would earn incentive fees if the stock price increased above a certain amount. They also falsely touted that IceWEB provides the cheapest storage box and the lowest cost/highest performance solution to public and private data storage centers such as Dropbox, iCloud, Evernote, Google Drive and Facebook. Smith did not know whether or not these companies were actually customers of IceWEB.