Shares of Medallion Financial Corp. were halted Wednesday after U.S. regulators accused the New York-based lender to taxi drivers of seeking to illegally boost its stock price amid intense competition from Uber Technologies Inc. and Lyft Inc.
The Securities and Exchange Commission alleged that after a string of banner years, Medallion floundered as the popularity of ride-sharing apps caused the value of taxi medallions, which were used as collateral for loans, to plummet. As the company’s stock plunged since 2013, it tried to drown out short-sellers by flooding media websites with bogus news articles, the SEC said in a complaint filed in federal court.
Medallion shares were halted Wednesday after the stock slumped more than 50% to $3.94. They then resumed trading, paring losses to about 33% as of 10:35 am in New York. The company traded almost as high as $18 a share eight years ago.
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