A fake takeover bid for Avon was filed with the SEC, causing a stir in the market and a sharp rise in Avon's shares. At the same time, it highlights the possibility that the filing system used by Wall Street is not that secure after all.

Thirty minutes before noon last Thursday, a regulatory filing appeared on the website of Securities and Exchange Commission detailing an offer from one PTG Capital Partners to buy Avon for USD 18.75 per share.

The filing caused such a stir that within several minutes, news wire services have reported on it. But when the dust settled down after noon, it turned out that the information stated in the regulatory filing is not accurate, leading some to conclude that it might be a hoax. The supposed British company and its legal representative in the US cannot be reached as well.

Avon has been rumored to be sold for some years now so this surprising filing is not entirely out of the blue. But when Avon finally stated its side, it was to deny that a buyout offer has been made for them.

Eventually, it proved to be a fake buyout bid. Throughout the day though, USD 91 million worth of stocks from Avon has been bought/sold and its stock price increased by almost USD 1.

Now, SEC officials have yet to confirm who made the fraudulent filing and if there was a clear intent at market manipulation. At any rate, concerns about the integrity of the Edgar database -- a system used by companies and financial managers who are involved in public trading to make filings -- are rising.

Apparently, companies make routine filings to the Edgar database -- totaling around 4000 filings every day -- all of which is made public at once. This is why it took some time to verify the offer. Moreover, in a bid to encourage companies to have consistent disclosure, third party filing is allowed in the Edgar system. This means that any insider, stockholder or fraudster could file to Hass and Associates Accounting's cache, for instance, even without credentials to officially file on its behalf.

It is unclear exactly how the agency verifies the filed information. According to SEC, "Under the federal securities laws, filers are responsible for the truthfulness of their filings, and they are subject to enforcement actions when they are false or misleading."

What's more, this does not seem to be the first time that Edgar database has been misused: In 2012, a false bid to buy Rocky Mountain Chocolate Factory was made by a supposed British firm called PST Capital Partners through the Edgar system.

Hass and Associates Accounting noted that an important takeaway from this incident could be the breaking of the belief that being in Edgar is equivalent to a stamp of approval from the SEC.