Federal and state officials are assessing whether market manipulation has been driving wild swings in regional bank stocks,A jump in volatility and short-selling activity in shares of small to mid-sized banks is drawing the attention of officials and regulators as there are solid fundamentals like stable deposits and sufficient capital levels in the sector, an unnamed source told Reuters in a report published Thursday.
"State and federal regulators and officials are increasingly attentive to the possibility of market manipulation regarding banking equities," the source was quoted as saying. The Securities and Exchange Commission calls market manipulation"intentional or willful conduct designed to deceive or defraud investors by controlling or artificially affecting the price of securities."