NASD Rule Change Targets Smallest Stocks

The struggle many of the market’s smallest stocks face in attracting investors may get tougher still: The operator of the OTC Bulletin Board, the electronic stock market for the tiniest U.S. stocks, now will attach a “scarlet letter” of sorts to companies that don’t file timely financial reports with regulators.

The National Assn. of Securities Dealers said the four-letter ticker symbols for Bulletin Board firms will be appended with a fifth letter--”E”--when a company is delinquent in filing reports. That will apply to all foreign stocks on the board and to U.S. stocks that began trading on that market after Jan. 4 of this year. By June 2000 it will apply to all board stocks.

The change is part of NASD’s program to eventually weed from the Bulletin Board all companies that don’t make current financial information available to regulators and thus to the public.