updated 3/8/2007 2:19:20 PM ET 2007-03-08T19:19:20

The Securities and Exchange Commission on Thursday suspended trading in 35 companies whose shares were touted in e-mail spam campaigns.

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The SEC said it took the action to protect investors from fraud, because the accuracy of information in e-mails about the companies was questionable. The SEC did not identify who had sent the e-mails or say whether any of the companies was responsible.

E-mails heralded with messages such as “Ready to Explode,” “Ride the Bull” and “Fast Money” clog people’s inboxes — an estimated 100 million of them a week — and spark dramatic spikes in trading and stock prices before the spamming stops and investors lose their money, the SEC said.

The suspensions are part of an SEC effort called “Operation Spamalot,” which began last fall. The suspensions will last for 10 business days, through March 21.

The companies’ shares are not traded on stock exchanges. They are listed on the so-called Pink Sheets, an electronic quotation service in which brokers posting quotations to buy or sell stocks are not required to investigate the background of the companies.

The use of spam e-mail to hype stocks is a variation on the classic “pump and dump” stock scheme, in which the perpetrators get people to buy stocks to inflate their prices and then sell their blocks of shares at a profit. Ordinary investors can suffer heavy losses when the prices tank amid the dumping of stock.

“When spam clogs our mailboxes, it’s annoying. When it rips off investors, it’s illegal and destructive,” SEC Chairman Christopher Cox said at a news conference. “Today’s trading suspensions, and actions that will follow, should send a clear message to spammers: the SEC will hold you accountable.”

SEC officials said their investigation of the individuals behind the spam schemes continues. Their identities are known to the agency, they said, but they were not made public.

“We are ... committed to tracking down those who prey on investors with false or misleading information,” said Linda Thomsen, the agency’s enforcement director.

In one case cited by the SEC, shares of Apparel Manufacturing Associates Inc. closed at 6 cents, on trading volume of 3,500 shares, last Friday, Dec. 15. After a weekend spam campaign, trading on the following Monday reached 484,568 shares and the stock climbed to over 19 cents a share. Two days later, on Dec. 20, it hit 45 cents a share. By Dec. 27, Apparel Manufacturing stock was down to 10 cents on volume of 65,350.

In addition to Apparel Manufacturing, the companies are: Advanced Powerline Technologies Inc., America Asia Petroleum Corp., Amerossi International Group Inc., Asgard Holdings Inc., Biogenerics Ltd., China Gold Corp., CTR Investments & Consulting Inc., DC Brands International Inc., Equal Trading Inc., Equitable Mining Corp., Espion International Inc., Goldmark Industries Inc., GroFeed Inc., Healtheuniverse Inc., Interlink Global Corp., Investigative Services Agencies Inc., iPackets International Inc., Koko Petroleum Inc., Leatt Corp., LOM Logistics Inc., Modern Energy Corp., National Healthcare Logistics Inc., Presidents Financial Corp., Red Truck Entertainment Inc., Relay Capital Corp., Rodedawg International Industries Inc., Rouchon Industries Inc., Software Effective Solutions Corp., Solucorp Industries Ltd., Sports-stuff.com Inc., UBA Technology Inc., Wataire Industries Inc., WayPoint Biomedical Holdings Inc. and Wineco Productions Inc.

© 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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