
Temporary suspension of Zoom Technologies, Inc [pdf] - doener
https://www.sec.gov/litigation/suspensions/2020/34-88477.pdf
======
kgwgk
[https://www.bloomberg.com/opinion/articles/2020-03-26/nobody...](https://www.bloomberg.com/opinion/articles/2020-03-26/nobody-
wants-a-margin-call-right-now)

Zoom/Zoom

People keep buying the shares of Zoom Technologies Inc., a company that
doesn’t seem to do much, but which has the Nasdaq ticker “ZOOM,” when they
mean to buy shares of Zoom Video Communications Inc., a company (ticker “ZM”)
that does a brisk business in the newly booming corporate-and-preschool-
videoconferencing sector. I have written about this phenomenon at least twice,
but people keep emailing me about it every time ZOOM goes up. I assume they
kept emailing the SEC too, because here’s an order suspending trading in ZOOM:

"It appears to the Securities and Exchange Commission that the public interest
and the protection of investors require a suspension of trading in the
securities of Zoom Technologies, Inc. (“ZOOM”) (CIK# 0000822708) because of
concerns about the adequacy and accuracy of publicly available information
concerning ZOOM, including its financial condition and its operations, if any,
in light of the absence of any public disclosure by the company since 2015;
and concerns about investors confusing this issuer with a similarly-named
NASDAQ-listed issuer, providing communications services, which has seen a rise
in share price during the ongoing COVID-19 pandemic."

By the way I hope you didn’t get too clever about this. For instance, if you
noticed that everyone was buying the wrong Zoom and decided to profit from
their stupidity by selling ZOOM short, then (1) you have done poorly (ZOOM is
up almost 900% year to date) and (2) now you might not be able to close out
your short.

~~~
raverbashing
> if you noticed that everyone was buying the wrong Zoom and decided to profit
> from their stupidity by selling ZOOM short, then (1) you have done poorly

When short-selling, I believe people either know very well what they're doing
(and they're using it as a "building block" into a bigger transaction) or they
really don't have a clue and are just acting on a "hunch". I believe 90% of
people are in the latter group.

~~~
pas
Could you give an example of how such a bigger transaction would look like?

~~~
raverbashing
Some examples here [https://www.investopedia.com/trading/options-
strategies/](https://www.investopedia.com/trading/options-strategies/)

(the basic one without safety nets is the "naked call")

------
tastroder
Context:
[https://news.ycombinator.com/item?id=22695441](https://news.ycombinator.com/item?id=22695441)

[https://finance.yahoo.com/news/zoom-technologies-trading-
sus...](https://finance.yahoo.com/news/zoom-technologies-trading-suspended-
ticker-150501270.html)

(both are far clearer than the SEC announcement)

~~~
rkagerer
Thanks! So in short, they have not suspended the popular videoconferencing
company, but rather shares of a smaller corporation that has a similar name /
ticker.

------
omarchowdhury
...the headline should make it immediately clear this isn't Zoom.com.

~~~
weinzierl
> ...the headline should make it immediately clear this isn't Zoom.com.

You probably mean _zoom.us_ which is the official URL of the videoconferencing
company. And there we are, it's all _very_ confusing.

------
jcims
Not to be confused with Zoom Telephonics (ZMTP).

I just want to know who made my Zoom modem back in 1992.

------
quezzle
This should be clarified in the headline.....

“People mistaking ZOOM for ZM leads to suspension of ZOOM” or something like
that.

~~~
alfla
it's kind of funny to keep it too :-)

------
scarmig
Efficient markets!

------
kd5bjo
I’m certainly not an expert in these things, but note that the first reason
listed isn’t confusion with Zoom Video, it’s the lack of public disclosures.

The rule 15c2-11 they refer to requires brokers to have those disclosures on
file before processing transactions. This reads to me like a warning to
brokers that any Zoom, Inc. trades they processed were very likely in
violation of regulations.

Again, this is from a quick reading from an amateur. If this actually affects
you, consult real professionals.

------
viraptor
This happened before around Twitter's IPO
[https://www.theverge.com/2013/10/5/4805010/twitter-ipo-
filin...](https://www.theverge.com/2013/10/5/4805010/twitter-ipo-filing-
prompts-mistaken-buying-rush-of-worthless-twtrq)

People started buying TWTRQ instead (not published yet) TWTR.

------
echelon
Why should the SEC protect those not doing due diligence at the expense of
those who want liquidity of their assets?

~~~
kd5bjo
Zoom Inc. hasn’t filed any public information for 5 years; I assume that means
things like quarterly financial reports. That seems like enough grounds for
delisting to me, quite separately from possible confusion with Zoom Video.

~~~
echelon
Ah! I was under the impression this was a legitimate company that deserved to
be traded. It sounds like it absolutely should be delisted.

------
droithomme
Zoom Video (ZM) is the legit company. Zoom Technologies (ZOOM) is a different
company.

------
discordance
tldr: Zoom Technologies, a Delaware corp with its primary office in Beijing,
has had its trading suspended. It is not related to Zoom Video Communications
Inc (NASDAQ: ZM) and people have been confusing them.

------
mproud
Oh, and any related data might be sold to Facebook:

[https://www.vice.com/en_us/article/k7e599/zoom-ios-app-
sends...](https://www.vice.com/en_us/article/k7e599/zoom-ios-app-sends-data-
to-facebook-even-if-you-dont-have-a-facebook-account)

~~~
mproud
Alright, you want a source, here you go.

~~~
paranoidrobot
You're talking about the wrong company. Like all the people buying the wrong
stock symbol.

