SEC Charges Former Alfi CEO Paul A. Pereira For Social Media Statements

The SEC has taken legal action against Paul A. Pereira, the former CEO and co-founder of Alfi, Inc., for allegedly disseminating false and misleading information via social media platforms to artificially inflate the company’s stock price.

Alleged Misrepresentation of Financial Performance

Under the pseudonym “Uptix12,” Pereira purportedly made statements shortly following Alfi’s May 2021 initial public offering (IPO), falsely claiming substantial revenue figures for the company. Contrary to his assertions, Alfi’s actual revenue at the time amounted to a mere $17,450. Additionally, Pereira allegedly fabricated claims of a forthcoming contract between Alfi and the founder of a prominent restaurant chain to deploy Alfi’s technology in the chain’s establishments. Investigations revealed no discussions between Pereira and the restaurant chain founder regarding such an agreement.

Fabricated Statements on Advertising Inventory

On August 17, 2021, amid a decline in the company’s stock price, Pereira allegedly issued further deceptive statements regarding Alfi’s advertising inventory, falsely asserting projections of over $100 million in available advertising space by the end of 2021. However, records indicate that the actual advertising inventory was less than $5 million at the time, with no reasonable basis to support Pereira’s optimistic forecast. Alfi ultimately filed for bankruptcy in October 2022.

Legal Action and Consequences

Eric I. Bustillo, Director of the SEC’s Miami Regional Office, emphasized the seriousness of Pereira’s alleged actions, stating that they aimed to artificially inflate the company’s stock price through misinformation. The SEC’s complaint, filed in the U.S. District Court for the Southern District of Florida, charges Pereira with violating antifraud provisions of federal securities laws. The SEC seeks various penalties, including a permanent injunction, an officer-and-director bar, and civil penalties against Pereira.

Editor’s Note: Readers are reminded that the SEC often over-charges, and ultimately backs away once a target mounts a defense. These are the SEC’s allegations, not evidence of wrongdoing. The respondent has not yet had the opportunity to present evidence or to counter the allegations contained in the SEC Press Release.

SEC Press Release

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Mark Astarita is a nationally recognized securities attorney, who represents investors, financial professionals and firms in securities litigation, arbitration and regulatory matters, including SEC and FINRA investigations and enforcement proceedings.

He is a partner in the national securities law firm Sallah Astarita & Cox, LLC, and the founder of The Securities Law Home Page - SECLaw.com, which was one of the first legal topic sites on the Internet. It went online in 1995 and is updated daily with news, commentary and securities law related links.

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