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Investor Protection
In order to reduce the likelihood of fraud, OTC Markets Group recommends that investors become knowledgeable about the OTCQX®, OTCQB®, OTCIDTM and Pink LimitedTM markets, your rights as an investor, and the companies in which you are investing.
To help investors identify opportunity and quantify risk, OTC Markets Group publishes a series of designations and informational flags on company quote pages found on otcmarkets.com
All securities must comply with the requirements of SEC Rule 15c2-11 and provide current information in order to be traded on the OTCQX, OTCQB or OTCID Markets. Companies that do not comply are traded on Pink Limited or the Expert Market.
See the OTCID Basic Market for additional information about how companies can provide the required disclosure to maintain a public market.
Learn more about the Pink Limited Market and Expert Market.
SEC Notice: Understand the Significant Risks of Short-Term Trading Based on Social Media - January 2021
The SEC’s Office of Investor Education and Advocacy warns investors of the significant risks of short-term investing based on social media, especially in volatile markets, and provides tips for long-term investing.
Retail investors may seek to profit from volatile markets by buying individual stock, including stock in heavily-promoted companies with smaller market capitalizations. Some of these stocks may be discussed in social media, news aggregators, investment research websites, online investment newsletters, ratings websites, message boards, chat rooms, and discussion forums. It can be tempting to jump on the bandwagon and follow whatever the crowd seems to be doing. Sometimes, however, following the crowd may lead to significant investment losses.
Notice of Luxembourg Company Fraudulently Impersonating OTC Markets Group - December 2020
It has been brought to our attention that a company in Luxembourg operating under the name “OTC Markets” or “OTC Brokerhouse” and the URL (www.otc-markets.eu) is using our name, logo, branding and CEO signature to generate false invoices and defraud investors in the European Union in connection with an IPO scheme. This is a fraudulent communication. If you have received communications from this company, please contact us at surveillance@otcmarkets.com and your securities regulator.
Related: Commission de Surveillance du Secteur Financier Warning | BaFin Warning
Investor Alert: Cryptocurrency and Blockchain-Related Stock Promotion - Released February 2018
In light of recent trading activity in companies announcing blockchain or cryptocurrency initiatives, we are providing this alert as a reminder to investors to consider the bulletins and information published by the SEC and FINRA regarding companies promoting blockchain businesses and Initial Coin Offerings (ICOs). Links to those materials may be found below:
Investor Alert: Bitcoin-Related Securities - Released November 2017
In light of the recent increase in trading activity and the uptick in stock promotion of Bitcoin, virtual currency, cryptocurrency and blockchain related securities, OTC Markets reminds investors to use caution and consider the bulletins and information published by the SEC and FINRA regarding Bitcoin-related securities. Links to those materials can be found below:
OTC Markets Group Policy on Stock Promotion - Released October 2017
OTC Markets Group monitors for potential promotional activity relating to securities trading on our markets. We review for anonymous paid promotions, possible connections to bad actors, and evaluate the promotions potential impact on trading.
A company whose security is being promoted may not be directly involved or even aware of a promotion campaign for their securities, however all public companies have an obligation to provide accurate disclosure to investors and quickly address any misleading information that could affect the trading market for their securities.
OTC Markets Group Policy on Stock Promotion
Stock Promotion: Best Practices for Issuers
Investor Alert: Marijuana-Related Securities - Released November 2016
In light of recent trading activity and promotion of marijuana-related stocks, we are providing this alert as a reminder to investors to consider the bulletins and information published by the SEC and FINRA regarding securities issued by companies with operations in the marijuana industry. Links to those materials may be found below:
The Financial Industry Regulatory Authority and the U.S. Securities and Exchange Commission regulate OTC Link® ATS, the trading platform operated by OTC Markets Group's wholly owned subsidiary, OTC Link LLC. OTC Link LLC is a broker-dealer and a member of FINRA and SIPC.
OTC Markets Group Inc. does not regulate the OTCQX, OTCQB, OTCID and Pink Limited markets. The company is neither a stock exchange nor self-regulatory organization (SRO) and is not itself regulated by the FINRA or the SEC. All subscribers to OTC Link ATS are FINRA member broker-dealers and are registered as broker-dealers with the SEC. Broker-dealer activities are also regulated by various state securities regulators. In addition, companies with SEC-registered securities are regulated by the SEC.
OTC Markets Group organizes and disseminates price and company information, making the markets more transparent, efficient and investor-friendly. Securities are categorized into four markets — OTCQX, OTCQB, OTCID and Pink Limited — based on the quantity and quality of information a company provides. OTC Markets Group also provides companies with services to engage and inform their investors.
It is important that all investors make informed investment decisions based on thorough research, which includes evaluating a company's disclosure and material news, as well as the price and market for the company's security.
Many OTC securities can be relatively illiquid, or 'thinly traded,' which can increase price volatility. Illiquid securities are often difficult for investors to buy or sell without affecting the quoted price. In some cases, the liquidation of a position in an off-exchange traded security may not be possible within a reasonable period of time.
Many equities are Penny Stocks. Penny stocks can be very risky, and investors should be aware of what type of security they are trading before making any investment decision. Due to the high level of risk involved in investing in penny stocks, a broker-dealer cannot sell them to a client unless it has approved that client's account for penny stock transactions, and the broker-dealer has received an agreement to the transaction in writing from the client. See: Penny Stock Definition, Schedule 15g. Penny Stocks are not permitted to join the OTCQX market.
Investors should gain a thorough understanding of their rights and investigate the background of the issuing company, individual broker, and brokerage firm before making trading decisions. Introductory investor rights and education resources, include:
Market 101 - OTC Markets Group's overview of the market structure, participants and processes
SEC Investor Information - SEC office of investor education and advocacy
FINRA Investor Information - FINRA investor education site
Microcap Fraud - Information about microcap fraud from the SEC
FINRA BrokerCheck® - Check the background of your investment professional
How to avoid problems with your broker - FINRA's tips on working with your investment professional
Invest wisely - FINRA's tools to better understand the markets and basic principles of saving and investing
NASAA Investor Education - Primer on the most common types of schemes, scams, and fraud which investors and entrepreneurs need to know about
Obtaining Financial Information on OTCQX, OTCQB, OTCID and Pink Limited Companies
Investors should always carefully review the financial information of all companies before making investments. Many off-exchange traded equities are issued by small companies with limited histories or that are in economic distress.
SEC Reporting Companies — SEC filings are available on www.otcmarkets.com under a company's 'Financials' tab on its quote page, as well as on the SEC's website. Some companies do not have filing or reporting requirements with the SEC. For a detailed explanation of registration and reporting requirements and the exemptions available through those requirements, please see the SEC's Small Business Question and Answer Page.
Non-SEC Reporting Companies — Although they may not be required to make financial information available to the public, many companies do so voluntarily. Financial Reports can be searched in order to obtain the reports of any company that has voluntarily provided their financials and other disclosure to investors via the OTC Disclosure & News Service. Investors should be aware that the accuracy or completeness of such information has not been verified by OTC Markets Group or reviewed by any U.S. regulatory body. Investors should regard such information as merely a starting point for their own research in evaluating the investment potential of these securities.
Securities and Exchange Commission
If you believe that you have been defrauded by a publicly traded company, please visit: The SEC Center for Complaints and Enforcement Tips.
FINRA
If you believe that you have been defrauded by a broker, securities firm, investment advisor, or other securities market participant, please contact: FINRA Investor Protection.
Your State Securities Regulator
North American Securities Administrators Association (NASAA) will help you find Your State Securities Regulator. Investors can report suspected Internet fraud to the NASAA by email: cyberfraud@nasaa.org. When sending a complaint, investors should forward the suspect message, give the website address, if appropriate, and include the name of the state in which they live.
OTC Markets Group
Please Submit a Tip to OTC Markets Group if you have market integrity concerns regarding an OTC security. Your tip information is subject to our Privacy Policy and reviewed at our sole discretion. We can best review your tip if you provide complete and accurate information. Please note that OTC Markets Group will not share details of its review with you.
OTC Market Group is not a regulator, exchange, or law enforcement agency. As such, we do not have enforcement authority and our ability to review tips is limited. We encourage you to also contact the appropriate authority with your concerns.
