CYNK Technology Corp (OTCMKTS:CYNK), A Mysterious $6 Billion Market Cap Social Site with No Members, Halted by SEC

What goes up must come down. CYNK Technology Corp (OTCMKTS:CYNK) reportedly earned its notorious mark on the internet among the likes of other over the counter hype stocks which follow the same patterns as a classical “pump and dump”.

From June 17^th to July 9^th, the company’s stock price had risen 25,000%+ from $0.10 to $4.00 and now closing at $14.7. If you had invested $10,000 into the company at the beginning, you would have an account balance value of $1,470,000, whether that amount could actually be liquidated and sold or not – that’s another issue. This company’s spectacular rise has resulted in the SEC halting the stock.

The company runs IntroBiz.com – a premier social networking site like LinkedIn or Facebook proclaiming to becoming the next biggest social networking tool. Users register, fill out their profile, and have the ability to contact celebrities, tv stars, and those in the business limelight. They believe their technology is unique, compelling and will gain widespread adoption.

The issue with this business: no revenue, and instead a net loss close to $1.5 million in the previous year. Yet the company is valued at almost $6 billion, almost a 6,000x yearly multiplier assuming earnings were $1.5 million instead of a loss. Why the little known social networking site didn’t raise any alarms earlier is a mystery to investors.

Speculation over the Stock’s Rapid Rise

Regulators believe the stock’s rapid rise was due to the work of boiler-room styled penny stock promoters looking to pump the stock so that insiders can cash out. Since the company is registered in Belize, it makes it hard to trace the main registrant and benefiter of the company’s stock increase.

Typically, the way the process works is as follows:

A penny stock company on the over the counter markets will bankrupt or shut down due to their business losing too much money, and they no longer have investors to support their business activities, or key management people departing from the company. In this case, CEO Marlon Luis Sanchez who holds all key positions in the business has left the company.
A rogue investor, usually from overseas or foreign will target the thinly traded penny stock company which usually has few shareholders and little liquidity. They will purchase the shell company from the CEO; and use the shell as a vehicle and medium to sell securities to the public.
This rogue investor will contact online penny stock promoters and pay them in order for them to alert their investor subscribers list about the “new” company. To make investors believe the investment story, the rogue investors will usually set up a legitimate concept or idea such as oil drilling/land acquisition contracts, medical marijuana related proof, a “new” alternative renewable energy source, or here, an internet based hype that would justify the absurdly high valuation.
Investors pick up on the news, start buying shares, which drives the stock price up since investors can only purchase from the rogue investors who hold all shares. If no investor sells, the stock price will continue to go up, as the rogue investors are willing to let go of shares at higher prices.
Now that rogue investors have made their money, they don’t care about the stock price. They may buy here and there to support the stock price. Usually since they are abroad trading with offshore accounts, they have little to worry about SEC investigations and after they’ve made their money, they have ample time to disappear.

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