Your story, "Anatomy of a Stock Deal Turned Sour" (July 21) about people in a Texas town following the lead of newcomer Thomas W. Reid by buying into a stock while the market was allegedly manipulated to affect the price--all to their ultimate disaster when the price bubble burst--raises an issue that has bothered me about regulatory enforcement activities.
Your story was prompted by a settlement with the Securities and Exchange Commission in which the defendant consented to a boilerplate court order. Reid does not admit or deny the charges but is prohibited in quite general terms from future securities fraud.
The SEC staff, for its part, announces another "victory" in protecting investors. They have again proven that their jobs are important.
This same Reid has twice enriched the SEC's statistical enforcement record. To the staff, he is almost worth cherishing as a provider of future employment. But the facts might be of some discomfort to investors who thought the SEC was protecting them (assuming that the SEC's allegations are true).